AstraZeneca ($AZN) turned heads today with an unexpectedly intriguing CEO choice: Roche's ($RHHBY) Pascal Soriot, who's been the Swiss drugmaker's COO and pharma chief since 2010. Within hours, Soriot had a full wardrobe of expectations to try on.
Analysts predicted he'd apply Roche's biotech savvy to AstraZeneca's struggling pipeline. After all, he hasn't just called the shots for the company's overall pharma business. Roche dispatched him to Genentech after the 2009 merger, and Genentech is Big Biotech with two capital B's.
"He will be looking to make significant changes, including reviewing the pipeline and doing more deals," Cenkos Securities' Navid Malik said, adding that Soriot may well step up dealmaking and licensing to amp up in biotech. Meanwhile, Goldman Sachs pointed out that, "Mr. Soriot as head of Roche Pharma had always been a strong believer in innovation."
Other analysts figured Soriot for a restructuring-minded chief with roll-up-the-sleeves experience in improving operations. "He is hands on and can spot a problem," Vontobel's Andrew Weiss said (as quoted by CNBC). Barclays' Mark Purcell saw Soriot's Genentech experience as evidence of his "important expertise in change management and execution."
That brings us to the common denominator: Change, change, change. When restless AstraZeneca investors started pressing for change at the top earlier this year, they pointed to all the company's well known problems. Thin pipeline, R&D disappointments, big patent losses, pricing pressures ... the list goes on. The consensus was that AstraZeneca needed major surgery, and pronto.
Whether Soriot will be that change-maker is anyone's guess at this point. As Purcell notes, all the qualifications in the world don't add up to an automatic turnaround. "AstraZeneca appears to have the right leadership in place ... but needs a coherent strategy, well executed, and to maximize the value of its capabilities," he said (as quoted by the Guardian).
The folks at AstraZeneca obviously believe he can do all that. "We are certain Pascal's leadership qualities, combined with his strategic thinking and relevant experience, make him the right person to drive the company to success," Chairman Leif Johansson said.
DZ Bank's Elmar Kraus apparently agrees. "He stands for successful pharma at one of the biggest players," Kraus told Bloomberg. "He has everything that AstraZeneca needs." And AstraZeneca needs quite a lot.
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