After four years working to turn around Bausch Health's Salix Pharmaceuticals, President Mark McKenna is leaving.
McKenna will this week become the CEO of a new precision medicine drug developer, Prometheus Biosciences, the revamped byproduct of Prometheus Labs’ merger with Precision IBD. And he'll leave a hole at Bausch, where he was viewed as a potential successor to CEO Joe Papa.
The jump is about opportunity, not dissatisfaction with Bausch or Salix, McKenna said. He'll leave Salix on relatively solid footing after a rocky first few years for the subsidiary at Valeant, which last year rebranded to take on the Bausch name.
Papa and Valeant’s board of directors brought McKenna into Salix in 2016 to helm the Salix integration and a drive for new revenue. But it was a messy time for Salix, with the company under investigation by the Department of Justice in a whistleblower lawsuit over improper sales rep behavior and marketing. Although the charges predated Valeant’s purchase, Salix agreed in mid-2016 to pay $54 million to federal and state governments to resolve allegations under the Anti-Kickback Statute and False Claims Act.
Since then, under McKenna's leadership, Salix has dialed back its big-budget TV campaign for irritable bowel syndrome with diarrhea (IBS-D) drug Xifaxan—built around the pink intestine “Gut Guy” mascot, which included a Super Bowl ad flop in early 2016—and reinvested in the sales force. McKenna led a strategic push to bulk up the primary care sales force by some 300 reps, mostly for Xifaxan to drive earlier recognition and awareness of IBS. Salix also integrated 100 Synergy sales reps in the first quarter pursuant to its stalking horse asset acquisition of the then in-bankruptcy company and its IBS-C drug Trulance.
As a result, Salix's second-quarter sales for 2019 reached $509 million, an increase of 15% year over year. Bausch credited the growth to Xifaxan, which grew 21% year over year.
McKenna also led the drive to grow Salix’s drug portfolio; the company now has 10 products in its pipeline, and it's made strategic transactions that include a licensing deal with Mitsubishi Tanabe, a co-marketing deal with Dova and the buy of Synergy.
The move "has nothing to do with Bausch. I think there’s incredible runway at Salix, it’s a great company. But the opportunity to go be a CEO and launch this company in the precision medicine space—I just couldn’t say no to it,” McKenna said.
He acknowledged that Xifaxan faces new competition—Cosmo last year received FDA approval for antibiotic Aemcolo, a rival in the travelers’ diarrhea market—but he said the drug is still in growth mode, and considering a settlement last year with Teva that keeps the Israeli drugmaker's Xifaxan rival off the market until 2028, it should stay that way for some time.
McKenna’s new company will focus on inflammatory bowel disease treatments. Prometheus Labs, which was acquired from Nestlé Health Science in July, will continue to serve as the diagnostic platform with Precision IBD as the drug discovery arm, McKenna said.
Prometheus Biosciences’ lead compound is a TL1A therapeutic target to treat Crohn’s disease; Pfizer is also studying the anti-TL1A antibody for ulcerative colitis. And Prometheus has seven other potential drugs in the pipeline, McKenna said.