“Pfizer CEO Bourla to meet with activist investor Starboard Value on turnaround pitch: FT”
With Pfizer’s revenue and share price slumping after the drugmaker skyrocketed to new heights during the pandemic, the company’s executives will reportedly hear out activist investor Starboard Value’s recommendations for a strategy shift.
Starboard holds a stake in Pfizer worth around $1 billion, The Wall Street Journal recently reported. Now, the fund’s CEO Jeff Smith and partner Patrick Sullivan, who heads up its healthcare investments, will reportedly meet with Pfizer’s chief Albert Bourla and lead independent director Shantanu Narayen to discuss their turnaround plans for the company, The Financial Times reports, citing people familiar with the matter.
The meeting was backed by Pfizer’s former CEO Ian Read and previous finance chief Frank D’Amelio, who reportedly spoke with at least four board directors, including Narayen, about hearing out Starboard’s pitch, according to The Financial Times.
According to the FT, some Pfizer shareholders would support a “shake-up” that could include replacing Bourla at the helm.
While Starboard’s exact pitch is unclear, people briefed on the investor’s thinking told FT that the activist believes Pfizer has been mismanaged in the wake of the pandemic, particularly with its $70 billion M&A spree that included a $43 billion buyout of antibody-drug conjugate (ADC) specialist Seagen.
Pfizer declined to comment on the matter when reached by Fierce Pharma.
Some of Pfizer’s recent acquisitions have suffered from setbacks. The company a few days ago decided to voluntarily pull its sickle cell disease drug Oxbryta from global markets after new clinical data raised concerns about its efficacy-safety profile. The drug was a key component in Pfizer’s $5.4 billion acquisition of Global Blood Therapeutics in 2022.
Earlier this week, Pfizer terminated the development of a second respiratory syncytial virus (RSV) antiviral it had obtained from the $525 million buyout of ReViral in 2022.
After riding high on its COVID vaccine sales, Pfizer’s stock currently trades at just over $30 per share, nearly 50% below its pandemic peak of $59.48 in December 2021 and slightly below pre-pandemic levels. The company has yet to make up for falling sales of its once-popular COVID products, a trend that caused a full-year revenue dip of 41% in 2023 after the company’s record-breaking year in 2022.
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