The decision by former Merck & Co. chairman and CEO, P. RoyVagelos, to join Regeneron Pharmaceuticals Inc. as chairman sentthe Tarrytown, N.Y., company's stock soaring for the second day ina row Tuesday.
Regeneron's CEO and president, Leonard Schleifer, told BioWorldVagelos, who retired from Merck last November, "will be involvedin every aspect of the company."
The news boosted Wall Street's confidence in Regeneron, which lastJune laid off 25 percent of its workforce after the failure of its leadcompound, ciliary neutrophic factor (CNTF), for treatment ofamytrophic lateral sclerosis (ALS). Regeneron's stock was trading at$13.13 in March before the company released the disappointingPhase III trial results of CNTF.
With the announcement Monday that Vagelos, who became MerckCEO in 1985 and chairman in 1986, was headed to Regeneron, thecompany's stock (NASDAQ:REGN) shot up 34 percent to close at$4.69. On Tuesday, the climb continued another 36 percent to $6.37.
Schleifer said Vagelos agreed to serve as Regeneron's chairmanbecause it reunites him with former colleagues and because of thecompany's scientific research.
Regeneron has three Nobel prize winners on its 10-member board.Two of them, Michael Brown and Joseph Goldstein, worked withVagelos in developing Mevacor, Merck's cholesterol drug. Inaddition, Schleifer said Vagelos knows two other Regeneron boardmembers - Alfred Gilman, a 1994 Nobel prize winner, and EricShooter.
Regeneron's science focuses on neurodegenerative diseases,peripheral neuropathies and nerve injuries. The company has twoproducts in clinical trials, brain-derived neurotrophic factor for ALSand NT-3 for peripheral neuropathies.
Schleifer said Vagelos had numerous offers. During his tenure asMerck's leader, the Whitehouse Station, N.J., pharmaceutical giantdoubled sales from $4.1 billion in 1985 to $10.5 billion in 1993."Hehas no plans to do this with any other biopharmaceutical company,"Schleifer said.
"He's going to divide his time between Regeneron and theUniversity of Pennsylvania" in Philadelphia, where he is chairman ofthe board of trustees.
Vagelos is already is on the job, Schleifer said, adding that his newchairman "knows no peer in his track record for fostering innovationand converting breakthrough scientific discoveries into commerciallysuccessful products. n
-- Charles Craig
(c) 1997 American Health Consultants. All rights reserved.