December 12, 2016
By Alex Keown, BioSpace.com Breaking News Staff
NEW HAVEN, Conn. – A shakeup of leadership at Alexion Pharmaceuticals has sent share prices tumbling more than 13 percent in premarket trading. The shakeup comes at a time the company is investigating allegations of improper sales practices for its blood-disorder drug Soliris.
This morning, the company announced Chief Executive Officer David Hallal and Chief Financial Officer Vikas Sinha have resigned their positions effective immediately. Hallal, who also gave up his spot on the board of directors, left the company for “personal reasons” and Sinha to “pursue other opportunities,” Alexion said in a statement this morning.
So far the committee investigating the allegations have not discovered anything that would require the company to adjust any earnings announcements, the company said this morning when it disclosed the leadership shakeup. However, the loss of the two executives, who could have been forced out by the board of directors, may hint at some problems from the investigation. When announcing the departure of the two executives, the company did not issue any statements thanking the two men for their service to the company.
The company announced the investigation in early November, several days after Alexion withdrew from a scheduled presentation at a healthcare conference. That sparked takeover rumors, but there were also questions about the late filing of its 10-Q form with the U.S. Securities and Exchange Commission. Several days later, the company disclosed that it was investigating allegations raised by a former employee regarding the sales of Soliris. The allegations stem to sales practices surrounding the drug “hat were inconsistent with company policies and procedures,” Alexion said.
With an annual price tag of about $440,000, Soliris is known as the world’s most expensive drug. It is used to treat paroxysmal nocturnal hemoglobinuria, a rare blood disorder that affects about one or two people out of every million.
The 10-Q was expected to be filed in October, but the investigation caused a delay. This morning Alexion said its Audit and Finance Committee has not yet identified any financial concerns relating to the investigation. Alexion said it expects to file the Form 10-Q by the end of December or in early January, although no specific timeframe was given.
Following the job changes, Alexion tapped David Brennan, the former CEO of AstraZeneca PLC , as the company’s interim chief executive. Brennan has served on the Alexion board of directors since 2014. Company directors will initiate a search for a permanent replacement for Hallal.
David Anderson, the former CFO for Honeywell, has been tapped to replace Sinha.
Leonard Bell, chairman of Alexion’s board of directors, said the leadership transition comes “during a period of great strength and momentum” for the company. He said Alexion has a robust rare disease pipeline and added the company is positioned for sustainable growth.
“With strong new leaders in place, we will continue to be relentlessly focused on serving patients and families with devastating and rare diseases. With a dedicated and talented team of 3,000 employees, coupled with our breakthrough medical innovation, Alexion will continue to develop and deliver life-transforming therapies for patients and families who count on us,” Bell said in a statement.
