Here's what the WSJ Interactive Edition had to say today about the changes at AGN:
Allergan's CEO Plans to Retire;
New CEO Is Novartis Executive
By RHONDA L. RUNDLE
Staff Reporter of THE WALL STREET JOURNAL
Allergan Inc. said its chairman, president and chief
executive officer, William C. Shepherd, plans to retire after
31 years with the company and will be succeeded by an
executive recruited from Switzerland's Novartis AG.
David Pyott, who heads Novartis's nutrition division, will
take over as president and CEO of Allergan, effective
Jan. 1. An Allergan director, Herbert W. Boyer, a
biochemist and founder of Genentech Inc., will assume the
chairman's post at the Irvine, Calif., specialty-drug
company.
Mr. Shepherd said he decided to retire because "I want a
different balance of life" that will "allow me to spend more
time with my family and my three grandchildren." The
executive, who is 59 years old, said he and the board
started quietly looking for his successor at the start of the
year. Mr. Pyott is 43; Dr. Boyer is 61.
In an interview, Mr. Shepherd said there was "a general
feeling" on the board that while there were some people
inside Allergan who might have handled the job, "the best
candidate was David Pyott." The nutrition division he
heads is best known for its baby-foods unit, Gerber
Products Co. As a member of Novartis's small executive
committee, Mr. Pyott has also had "considerable
exposure" to the pharmaceutical and eye-care businesses
that are so important to Allergan, Mr. Shepherd said.
He said the decision to step down was entirely his own.
But his departure will be abrupt. While Mr. Shepherd will
continue to do some consulting for Allergan, he is giving
up all of his posts at once, including his board seat. And
Allergan's financial performance and stock price have been
disappointing over the past couple of years.
"There are a lot of distinctly unhappy institutional
shareholders, who may have found some receptive ears on
the board," said Steven B. Gerber, an analyst at
Oppenheimer & Co. In a letter to shareholders this
summer, Mr. Shepherd acknowledged that "we are not
satisfied with our financial performance for the first half of
the year."
However, Mr. Gerber said the timing of Mr. Shepherd's
departure was surprising, because some of the difficult
decisions he has made over the past couple of years may
be about to bear fruit. "He definitely deserves a lot of
credit for moving the company in the direction of spending
more heavily on technology and planting the seed for a
second business in dermatology."
Mr. Pyott, while relatively unknown to Wall Street
professionals, speaks four languages and brings a strong
international background to Allergan. Most recently
based in Basel, Switzerland, he has worked in several
countries, including Austria, Spain, Malaysia and
Singapore. After joining one of Novartis's predecessor
companies, Sandoz, in 1980, Mr. Pyott worked in
Minnesota for five years, Mr. Shepherd said.
Mr. Pyott's global experience could help Allergan, which
has about 58% of its sales overseas. Last year, Allergan
had net income of $77.1 million on sales of $1.15 billion.
The Novartis businesses Mr. Pyott has been running have
almost $3 billion in sales, an Allergan spokesman said. |
