Pharmas Market with Mike Huckman

The Battle of BioMarin


One of the many things I think is great about is the direct contact it gives me with a handful of biopharma reporters who are using it. Don't get me wrong. We're not giving away scoops. No way!  But I do get to see what a few of them are paying attention to. Sometimes we get into interesting exchanges and occasionally I spot a story idea. 

In fact, I got the tip for this blog post from a tweet's Adam Feuerstein sent out yesterday. He spotted this rather extraordinary SEC filing from BioMarin Pharmaceuticals . It's a resignation letter from one of its board members, Joseph Klein. Now, usually that kind of stuff is pretty boring and boilerplate.  For example, "I have submitted my resignation, effective immediately, for personal reasons." Or, "I hereby resign, effective immediately, so I can spend more time with my family and pursue other interests."  Blah, blah, blah.  But, no.  This resignation letter appears to be sending shares of BMRN to a new high in very heavy trading volume. Klein airs several pieces of dirty laundry in the letter, but the biggest item is this: "Disagreement with the CEO on How and When the CEO should present to our entire Board a serious, reasonable offer by a third party to acquire the company."

The company responds that it "disputes Mr. Klein's assertion that Mr. Bienaime, (the CEO,) received a bona fide offer from a third party and failed to share this offer with the Board for consideration.  Notice that the company used the words "bona fide offer." Klein used the words "serious, reasonable offer." And speaking of bona fides, Klein sits on the boards of OSIPharma, Savient and Isis. The company also intimates that Klein is trying to save face by resigning because the rest of the board had decided not to re-nominate him. Liana Moussatos, who covers BMRN for Wedbush Securities, says there's been speculation about the company being a takeout target for years, but that she was completely surprised by the tit-for-tat in the SEC filing.  She says feedback from investors suggests they think "maybe there was a low-bid offer that wasn't taken seriously." Moussatos has been neutral on the stock because of its price.  Wedbush makes a market in BMRN and wants to do business with the company. As Adam Feuerstein tweeted, "I love a good fight." So do I. So do I.

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