Teva Aims To Reshape Its Board -- WSJ
Teva Pharmaceutical Industries Ltd. will seek to overhaul its board by nominating four new directors, the latest step toward remaking the struggling drug company.
Teva, the world's biggest seller of low-price generic drugs, will ask shareholders to approve the nominees at the company's annual meeting July 13, said Sol Barer, the board's chairman. The nominees would replace longtime board members who have decided to step aside or aren't seeking new terms.
Three of the nominees would bring international drug-industry and financial experience to the Israel-based company, while the fourth is an Israeli venture-capitalist. Among their first orders of business would be picking a new chief executive.
"We are evolving the board to meet new challenges both within Teva and the business" of generic drugs, Dr. Barer said in an interview.
The nominees include Murray Goldberg, former chief financial officer at Regeneron Pharmaceuticals Inc.; Roberto Mignone, managing partner of hedge fund Bridger Management LLC that specializes in health care; and Perry Nissen, a former GlaxoSmithKline PLC research-and-development official who now leads the Sanford Burnham Prebys Medical Discovery Institute in La Jolla, Calif.
The fourth nominee is Chemi Peres, managing partner of Israel's Pitango Venture Capital, which has invested in health care and information technology.
They would replace Ari Belldegrun, who left the board in January; Roger Abravanel, who is resigning as of the annual meeting to support the board's makeover; and Ory Slonim, who is not standing for re-election. Joseph Nitzani will leave when his term ends in September.
None of the nominees had a comment, a company spokeswoman said. In statements, Mr. Slonim said, "I thought it would be better to allow the board to refresh" with new members; Mr. Abravanel said that he will be involved in the company in the future, and he is "proud to have been a board member"; Mr. Nitzani said, "I consider rotation as a significant value." Mr. Belldegrun had no comment.
Teva is confronting challenges of its own as well as those besetting the entire generic-drug industry.
Like other generic-drug makers, Teva faces a tough pricing environment and intensifying competition for copycat medicines that is squeezing their tight margins. The company must also deal with $32 billion in debt and a sprawling supply chain accumulated through acquisitions.
And multiple-sclerosis therapy Copaxone, one of Teva's few brand-name drugs but a key source of sales and profit, is starting to lose patent protection in the U.S.
The company has been trying for several years to effect an overhaul. In 2012, it hired Jeremy Levin from Bristol-Myers Squibb Co. to take the helm but he was forced out the next year during a dispute with the board over the direction to take the company.
His replacement, Erez Vigodman, an Israeli who was familiar with the company from his time serving on its board but lacked a drug-industry background, stepped away from the company in February for undisclosed reasons. Longtime CFO Eyal Desheh is scheduled to leave June 30.
Analysts and investors have been pressuring Teva to add more global industry experience to the board, so it can support executives to take the steps needed to restructure the company.
Dr. Barer described the new board nominations as an effort to position Teva to make "a lot of tough decisions." With the new members added, the board would be "ready for change" and back up the next chief executive to "aggressively move Teva forward."
The board is interviewing candidates for chief executive, and the choice would likely be someone from outside Israel willing to live in the country and with global drug-industry experience. He declined to give a timetable for a decision, but said the search is the company's main priority.
The board is also looking for a chief financial officer, but Dr. Barer said the next chief executive would pick the person.
Write to Jonathan D. Rockoff at Jonathan.Rockoff@wsj.com, Denise Roland at Denise.Roland@wsj.com and Rory Jones at rory.jones@wsj.com
(END) Dow Jones Newswires
June 09, 2017 02:47 ET (06:47 GMT)