Print“Brennan has been in the hot-seat in recent weeks from shareholders who have been clamoring for his resignation.”
David Brennan, CEO of AstraZeneca, will step down as head of the company on June 1 after a six-year stint that saw the company struggle with drug development setbacks and competition from generic drug competitors.Brennan has been in the hot-seat in recent weeks from shareholders who have been clamoring for his resignation in the wake of AstraZeneca’s poor performance. First quarter results for the beleaguered company didn’t help Brennan’s case.
During the first quarter of 2012, the company’s revenue fell 11 percent, profits sank 44 percent, and earnings per share plunged 38 percent in part due to restructuring charges. Excluding the cost of restructuring, AstraZeneca’s core earnings per share still fell 19 percent. The poor results forced the company to lower its earnings guidance for the year.
During Brennan’s tenure, AstraZeneca has suffered several setbacks in its drug development programs, including in March, the failure of an experimental drug for depression that the company had been co-developing with Targacept. Furthermore, the type 2 diabetes treatment it has been developing with Bristol-Myers Squibb, dapagliflozin, has failed to win approval from the U.S. Food and Drug Administration, though the drug did just receive a recommendation for approval in the European Union.
In recent months shareholders and analysts have continued to push the company to make more significant acquisitions to help replenish its drug pipeline but Brennan has stood firm in his belief that no such major deal was necessary.
Instead, the company has made many smaller deals including the just announced $1.3 billion acquisition for Ardea Biosciences and its late-stage gout drug. AstraZeneca also recently agreed to co-develop five of Amgen’s drugs aimed at inflammatory diseases.
While Brennan told reporters that it was his choice to resign, reports from the BBC and The Financial Times suggest that a boardroom “coup” pushed Brennan out the door.
April 27, 2012
http://www.burrillreport.com/article-astrazeneca_ceo_to_step_down.html
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