Biogen Idec Draws "Line In The Sand" With Carl Icahn
I'm blogging a little later than usual because I got sidetracked by the breaking news on the government stopping part of a big diabetes drug study over safety concerns--more people died in a group that was being intensively treated to get their blood sugar levels below current recommendations.
The patients are being treated with a whole host of diabetes drugs made by about a dozen companies. But when we broke the news shortly after 10:30 ET, when the embargo lifted, for some reason it seemed to move shares of Amylin Pharmaceuticals , which makes Byetta, more than the others.
Anyway, I wanted to blog with some color from the Biogen Idec earnings conference call this morning. The company beat the Street, sales of Tysabri for multiple sclerosis were higher than expected and the biotech reaffirmed its 2008 financial guidance.
And it sounded like the lawyers didn't completely muzzle management regarding the proxy battle activist investor Carl Icahn is waging. He wants to get three of his people on the BIIB Board in the wake of the company taking itself off the market.
During his prepared remarks, Biogen Idec CEO Jim Mullen said:
"Despite the Monday-morning quarterbacking going on, the basic fact remains that no company put a bid on the table. And for those major pharmas (who could afford such a big acquisition) the perceived risk of Tysabri was simply too great."
He's referring to the fact that Tysabri was pulled from the market after a few cases of a rare and potentially fatal brain disorder appeared. It has since been brought back to market under tight restrictions and, so far, there've been no more reports of the problem.
But then in the q. and a. period, Mullen issued a stronger rebuke of Icahn:
"These types of distractions aren't helpful. We, as a Board and management, remain open to all of the opportunities to maximize shareholder value, but I don't think the right way to run the business for anyone's sake is to have a permanent 'For Sale' sign on the front lawn. If circumstances and conditions change, we will address those at that time."
For the time being, investors seem to be satisfied. BIIB shares are up. And so are shares of its Tysabri partner, Elan . Gotta keep the "Elanians" at bay.
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