- Weeks after installing a new CEO, BioMarin Pharmaceutical is overhauling oversight of the company at the board level.
- Facing pressure from activist investor Elliott Investment Management, BioMarin’s board named three new independent directors and set up a Strategic and Operating Review Committee to evaluate the company’s operations and priorities. Two of the new independent directors will serve on the review committee, BioMarin said Wednesday.
- The company said it’s also set up cooperation and information-sharing agreements with Elliott. The changes will “put BioMarin in the best position to realize its full potential,” Elliott Senior Portfolio Manager Marc Steinberg said in the company’s press release.
BioMarin is a successful biotech company, having won approvals for eight medicines that regularly turn it a profit. But the company’s most high-profile new product — the first gene therapy to treat hemophilia A — has stumbled in its launch, forcing BioMarin to slash sales estimates and raising the ire of investors.
Elliott built up a stake to become one of the company’s largest investors and is now forcing changes. “This seems like it could eventually represent a welcome step towards more disciplined spending, along with things like profitability/margin targets,” Stifel analyst Paul Matteis wrote in a note to clients. BioMarin may also be a target for a takeover, he said.
The deal with BioMarin is similar to one Elliott struck earlier this year with contract drug manufacturer Catalent, which also agreed to add new independent directors and set up a review committee. The activist fund has also successfully pushed major companies toward buyouts, including Alexion, which agreed in 2020 to be taken over by AstraZeneca in a $39 billion deal.
BioMarin’s new independent board members, Barbara Bodem, Athena Countouriotis and Mark Enyedy, all have experience in the healthcare industry and as board directors. Bodem and Enyedy will serve on the new BioMarin review committee, along with existing director Maykin Ho, CEO Alexander Hardy and board Chairman Richard Meier.
Hardy joined the board when he took over for longtime BioMarin CEO Jean-Jacques Bienaimé on Dec. 1. At that time, Bienaimé also relinquished the chairman title to Meier, though he kept a spot on the board until next year’s annual meeting. BioMarin said Wednesday that the board will temporarily expand to 15 to add the new directors, but shrink back to 11 no later than the 2024 annual meeting.
In announcing the deal, Elliott also expressed support for Hardy, calling him “the right leader for this chapter of BioMarin’s value creation story.”
This post has been syndicated from a third-party source. View the original article here.