Alexion’s new CEO has quickly brought in some new people, including more former Baxalta colleagues, to fill the puzzle piece holes left after his executive clean sweep last week. But not everyone is impressed with the process or the new people.
CEO Ludwig Hantson today announced he would be joined in the C-suite by Anne-Marie Law and John Orloff, both former Baxalta execs, and Indrani Franchini, formerly of Pfizer. Law takes over HR and Franchini is the new chief compliance officer, while Orloff will be tasked with figuring out Alexion’s pipeline needs to move beyond its reliance on pricey rare disease drug Soliris..
“I am delighted to welcome John, Anne-Marie, and Indrani to Alexion. Each of these highly talented executives brings deep industry experience and a proven track record in their respective areas of expertise,” Hantson said in a statement.
With those and last week’s appointment of Baxalta and Baxter vet Brian Goff as chief commercial officer, the board of the Connecticut biotech has overseen the remaking of pretty much the entire upper ranks of the company starting with the appointment of Hantson in March.
Hantson, the former CEO Baxalta, came in after the departures of then-CEO David Hallal and CFO Vikas Sinha. They made their exit last year amid an internal probe of Alexion sales practices that ultimately found the company’s higher-ups had inappropriately pressured staff to pad sales of Soliris.
Barclays analysts in a note to clients today said they see the moves as positive for Alexion and an indication Hantson is acting swiftly.
Alexion sceptic and Leerink Partners analyst Geoffrey Porges also had some reassuring things to tell clients today before unloading a litany of complaints against Hantson, his process and his picks.
He noted that Orloff, Law, Goff and Franchini mostly come from positions of significant responsibility and their appointments should “offer some salve to investors concerned by the recently announced departures.”
That said, Porges wrote that, “This parade of changes and the specific appointments are unfortunately consistent with our disappointment with the performance and profile of the company’s newly appointed CEO.”
While a remaking of the executive ranks was in order, he faulted Hantson for the wholesale firings and hirings, which he said gave the impression “of a business and an organization that are broken and in need of complete reinvention,” which was not investors’ impression despite its past problems.
“Investors can be forgiven for concluding that Alexion is irreparably broken, from the scope of these changes, the manner of their implementation, and the commentary being offered by the incoming CEO,” Porges wrote.
He also wonders whether the ex-Baxalta members, with long experience at a large, legacy product, low margin company, have what it takes to lead an innovative rare disease drug focused operation which is finding its footing among a number of challenges.
“Investors might be relieved to have experienced executives appointed at Alexion, but would be disappointed if the company’s financial profile looked like Baxalta’s several years from now,” Porges noted.
Despite all of those reservations, he pointed out Leerink has an Outperform rating on Alexion's share.