According to TheStreet's source, activist investor Carl Icahn is launching a battle for control of Genzyme.
The beleaguered biotech's problems are well-documented. Viral contamination was discovered at a bioreactor in its Allston Landing facility outside Boston in 2009, leading to a plant shutdown and extended cleanup. That led to shortages of Genzyme's rare disease drugs Cerezyme and Fabrazyme. But just as the facility was coming back online, new production problems--caused by aging equipment--derailed those efforts.
Shire and Protalix are making progress on developing drugs that would compete with Genzyme's Gaucher disease drug Cerezyme. Both companies will probably charge less than the $200,000 Genzyme charges for its treatment, giving them an opportunity to snag a substantial piece of the market that currently earns Genzyme $1.2 billion a year. These problems caused Genzyme stock to drop 26 percent last year, leading to calls for long-time CEO Henri Termeer to resign.
Smelling blood in the water, Icahn has notified Genzyme that he will ask shareholders to appoint himself and three other directors of his choice to the company's board, according to TheStreet's Adam Feuerstein. "Our actions demonstrate that we are open and responsive to shareholder input, and we welcome a constructive dialogue with Mr. Icahn," Termeer says in response to Icahn's move.
- read Genzyme's announcement
- here's TheStreet article