Carl Icahn says he's going to fix Genzyme--if other shareholders give him a chance. In his first public statement after notifying the company that he intends to fight for four seats on its board, Icahn criticized management and claimed that other stockholders are unhappy with the status quo.
"Given that Genzyme's management has performed so poorly in the past, our first task will be to attempt to help fix what is broken," says Icahn, (as quoted by MarketWatch). "We have heard from a number of shareholders that they have very little faith in the current board and believe that there should be a major shake-up in its composition."
Genzyme has been under the gun lately following the sidelining of a major manufacturing plant because of viral contamination. This caused critical shortages of two of its top products, Cerezyme and Fabrazyme. Indeed, today the company announced that the latter drug, which is used to treat Fabry disease, would continue to run short. Production of the drug will languish at 30 percent of demand until after June 30, the Boston Business Journal reports.
Icahn has a history of moving in on companies he's criticized to pump up profits and then cash in. Whether Genzyme's other stockholders will go along with his plan remains to be seen. Analysts aren't crazy about the idea; one told Dow Jones that Genzyme should get a chance to fix its problems on its own. "[Icahn] probably has decent business advice for most CEOs," says John Sullivan, Leerink Swann's director of research, "but that doesn't mean he deserves four seats on the Genzyme board."