Eli Lilly Tuesday said Sidney Taurel, the drugmaker's longtime chief executive, will retire on March 31 and will be succeeded by Chief Operating Officer John Lechleiter.
The appointment of Lechleiter, 54, comes ahead of looming patent expirations on three of Lilly's top drugs. The CEO-designate acknowledged earlier this month that the company will face "its biggest challenge" ever as the medicines confront competition from cheaper generics.
Taurel's retirement and the selection of Lechleiter to succeed him had been widely expected since Lechleiter was promoted to COO in October 2005 and assumed ever greater responsibility and a higher profile with the Indianapolis-based company.
Lechleiter came to Lilly in 1979 as an organic chemist and over the next 15 years took a number of senior executive roles in research and development, including stints in England and Europe. In 2004, the year before he became Taurel's top deputy, he was named head of Lilly's pharmaceutical operations.
Taurel, 58, joined Lilly as a marketing associate in 1971 and took the helm of the company in July 1998. He has been chairman since early 1999. He will continue as board chairman until the end of 2008, Lilly said in a press release.
Under Taurel, Lilly has been recognized for its research prowess, developing medicines that have become blockbuster products, including schizophrenia treatment Zyprexa, anti-depressant Cymbalta and chemotherapy agent Gemzar.
But Lechleiter acknowledged in a Reuters interview early this month that it will be difficult for Lilly to make up the revenue shortfall when those three drugs face patent expirations between 2010 and 2012.
"There's no question we will face the biggest challenge of our history at the beginning of the next decade, but we're confident we can meet that challenge based on new products being launched before and during that period," he said.
Toward that end, Lechleiter said Lilly aims to launch, on average, two new drugs per year beginning in 2011, increasing to three per year by 2014. It aims to move at least 10 additional drugs into late-stage studies by 2011.
The company also has financial strength to license or buy more drugs, said Lechleiter.
At a Lilly meeting with investors and analysts in New York on Dec. 6, Taurel remained largely out of the spotlight, allowing Lechleiter to take the lead in describing company strategy.