The ongoing restructuring underway at AstraZeneca ($AZN) claimed one more employee today: The chief architect.
CEO David Brennan has abruptly resigned--pushed out in a coup, according to the BBC--with plans to hand over the reins to CFO Simon Lowth as the pharma giant begins the hunt for a new chief. Leif Johansson will move in to the non-executive chairman's spot June 1, moving up the date on the planned switch out at the top to provide some stability for a company undergoing wrenching changes.
Brennan's departure marks the end of a 6-year stint plagued with R&D setbacks capped by layoffs and a showdown with a restive crowd of investors and analysts increasingly frustrated by the company's failure to execute an effective round of acquisitions and licensing deals. His resignation will take him out of the firing line for the annual meeting after the company reported a 44% plunge in first quarter profits, a predictable result of new generic competition for Seroquel.
Brennan's R&D strategy in anticipation of the patent cliff has been widely viewed as a complete bust, leaving the company with the weakest late-stage pipeline in Big Pharma. His $15 billion deal to acquire MedImmune has netted no new big products. And a string of clinical setbacks was capped recently by the failure of a Phase III depression program. In response, Brennan has been axing staffers, most recently offering plans to chop 2,200 research workers in a new round of layoffs.
The focus now is on AstraZeneca's next steps on the deal-making side. The company has been scrambling to come up with a round of acquisitions, like its recently announced plan to buy Ardea for $1.26 billion. And Brennan said today that that strategy will continue as the company adds more such deals in the single-digit billion dollar range.
AstraZeneca has emerged as one of the most likely companies to play White Knight to Amylin ($AMLN), which has been fending off a reported buyout offer from Bristol-Myers Squibb ($BMY). The company's willingness to go in any disease direction to strike new deals will make it a possible bidder for a range of biotechs. And in this heated M&A environment, with a string of companies like Bayer already scouting significant buyouts, keeping AstraZeneca in the M&A game will likely help add to the premiums sellers can expect.
- here's the press release
- get the BBC story