Story of significant interest to more than one biotech -
Bayer, seeking pharma partner, changes health CEO
By Steven Silber
FRANKFURT, Oct 28 (Reuters) - Germany's Bayer AG (Xetra: 575200.DE - news) said on Monday its healthcare chief was leaving the company, heightening speculation of disarray at the inventor of aspirin during its vital search for a pharmaceuticals partner.
The drugs and chemicals conglomerate said Rolf Classon, head of its diagnostics unit, would replace Frank Morich as chief executive of the healthcare segment, effective immediately.
Morich, 49, had left by mutual agreement, the company said, declining further comment.
Bayer wants a junior healthcare partner to help shore up its pharma-product pipeline stung by last year's costly recall of cholesterol drug Baycol.
But many analysts say few quality firms are willing to be a junior partner with a company that had big problems with two key products last year, Baycol and haemophilia treatment Kogenate.
Morich is the second senior Bayer healthcare executive to leave the group this year following drugs head David Ebsworth.
The company has said both men left by mutual agreement, although some market observers say Ebsworth took the blame for problems including the withdrawal of Baycol, which has been linked with some 100 deaths due to side effects.
Ebsworth is now CEO of Oxford GlycoSciences Plc (LSE:OGS.L).
Opinions vary on why Morich has gone.
"There's a big internal fight going on between those who want to sell the drugs business and those who want to keep control," said one British-based consultant familiar with the company.
"I think Morich was one of those advocating surrendering majority control. The crisis is getting deeper because the longer they delay in doing a deal the less attractive they become to any prospective partners."
A London-based analyst said: "With Ebsworth going earlier this year from the pharma business and now Morich -- it's like the Oscar Wilde quote: 'To lose one parent may be regarded as a misfortune, to lose both looks like carelessness.'"
"I guess it's got something to do with their inability to find a healthcare partner."
By 1730 GMT, Bayer shares were up 1.2 percent at 18.64 euros compared with a 1.6 percent rise on the DJ Stoxx European chemicals index .
NEWS BY YEAR-END?
Bayer Chief Executive Werner Wenning has repeatedly said he was working hard to find a partner for the pharmaceuticals business and aimed to have something noteworthy to report by year-end.
He has said his company was in talks on the pharma alliance and was looking for "a complete solution", not just buying a new product. Bayer might have to reconsider its objectives if it cannot find a minority partner for the drugs unit, a key component in healthcare, he says.
Company sources, meanwhile, told Reuters that the timing of Morich's departure was a surprise, if not his actual exit.
Classon, born in Sweden, joined Bayer in 1991 as executive vice president of its diagnostics business group, responsible for marketing, sales and services.
The 57-year-old became head of the business group at the start of 1995. The unit is headquartered in the United States.
"Among his accomplishments at Bayer, Classon was responsible for the successful integration of the diagnostics activities of (U.S. biotechnolgy firm) Chiron (NASDAQ: CHIR) into Bayer's diagnostics division," the company said.
Before joining Bayer he held various managerial posts at Swedish healthcare company Pharmacia AB.
Wolfgang Hartwig, an official at the diagnostics unit, becomes head of diagnostics. He has been with Bayer since 1982. (additional reporting by Ben Hirschler in London and Baerbel Brockmann in Duesseldorf) |
