Genzyme Adds Board Member As Troubles Mount
1 CommentBy Ed Silverman // December 10th, 2009 // 6:35 am
After months of serious problems, Genzyme added an independent director to its board under pressure from Relational Investors, an activist hedge fund, The Wall Street Journal reports. The biotech added Bob Bertolini, who was chief financial officer at Schering-Plough before it was acquired by Merck (see statement).
Genzyme has endured nothing but trouble this year as quality control problems forced the biotech to suspend shipments of key products for such ailments as Gaucher’s and Fabry diseases, and the subsequent shortages prompted the FDA to allow rivals to jumpstart plans to produce their own meds to fill the void (see coverage here and here).
The difficulties have shaken confidence in Genzyme management, leading to speculation the board would be pressured to make changes. Adding Bertolini is “positive, but there is a lot more change that needs to take place,” Ralph Whitworth, who heads Relational, tells the Journal. “There needs to be significant further improvements in the board composition.”
Photo courtesy of the Associated Press
Condor
Great pick-up, Ed!
One thing is certain: if Whitworth’s Relational Investors wanted a new board member who’ll advocate for an early “cash-out exit, at essentially any cost” to all the other stakeholders, and possibly even the smaller common shareholders. . . in SGP Ex-CFO Bob Bertolini, they’ve likely found their man (solely in my opinion — given that he likely will personally pocket something like $120 million, all-in, for his part in busting-up old Schering-Plough).
In an unusual twist, see the link above for much more — about Bertolini’s continuing “confidentiality and non-use obligations” in favor of New Merck — each arguably not allowing him to participate in many Genzyme board discussions or decisions — and, in perpetuity, it would seem.
Namaste — should be interesting to watch it all unfold.