Continue Reading Below
BOSTON (Reuters) - The chief executive of Biogen Idec Inc said he wants members of the biotechnology company's board who were originally nominated by activist investor Carl Icahn to remain, even though Icahn has significantly reduced his stake in the company.
"As far as I'm concerned they are really good board members and I'm really happy to have them," George Scangos, who took over as Biogen's CEO in July last year, said in an interview on Wednesday on the sidelines of the Stifel Nicolaus conference in Boston. "I'm hoping they will continue."
Three of Biogen's current 12 board members were originally backed by Icahn: Alexander Denner, Richard Mulligan and Eric Rowinsky. Icahn's success in getting representation on the board came after he pushed Biogen in 2007 to put itself up for sale, but it failed to find a buyer.
While Icahn's strategy is often to force the sale of a company he has taken a stake in, in Biogen's case that has not been necessary to generate a significant return.
Biogen's shares have roughly doubled since the middle of last year, helped by a restructuring implemented by Scangos and promising results of a clinical trial of its experimental multiple sclerosis drug BG-12.
Continue Reading Below
Icahn had sold most if not all of his shares in Biogen as of the end of June, after holding a 5.6 percent stake as recently as May, according to regulatory filings.
Investors are awaiting the results of a second trial of BG-12, that some analysts believe could become the leading oral MS treatment.
The results of the second trial, known as CONFIRM, are expected before the end of this year.
"There's no reason to think the second trial will be different," Scangos said, adding that it is never possible to predict with certainty.
Scangos said he believes BG-12 and the company's existing drug Tysabri could both be "multibillion-dollar" drugs.
Tysabri's sales have been curtailed by safety concerns, but Scangos said he expects them to continue to pick up now that a test is available to screen patients for the presence of JC virus, which can cause a rare brain infection known as progressive multifocal leukoencephalopathy, or PML.
"I don't think it will be a straight line up for Tysabri, but I think it will be a line going up over the long term."
Biogen has a promising portfolio of products in the later stages of development, including drugs to treat Amyotrophic lateral sclerosis, or ALS, and hemophilia, but Scangos said the company is on the lookout for earlier-stage products that will fuel growth over the long term.
He did not give a timeframe for making any acquisitions, saying only that he will evaluate each product on its merit.
"We're not in a situation where we desperately need to buy things, so we don't need to overpay," he said.
On the other hand, he wants to attract partners and is up against competition from big pharmaceutical companies that are also keen to acquire promising new products in early stages of development.
Scangos said the company has some "good thoughts" about how deals can be structured that would provide a "win-win" for Biogen and for a potential partner. And he said the company is making strides in changing the culture at Biogen in a way that could help give it a more entrepreneurial feel.
"Biogen has a lot of really good people, and one of the things I think I've done well is just taking off the restraints that kept them from functioning as well as they could. Most companies tend to be over-managed. The best thing I can do is clear obstacles out of the way and let them go." (Additional reporting by Lewis Krauskopf, editing by Dave Zimmerman )