(Reuters) - Alexion Pharmaceuticals Inc (ALXN.O) on Monday named former Baxalta CEO Ludwig Hantson to its top job, as the rare-disease drug maker seeks to regain investor confidence following the exit of top management.
Hantson’s appointment comes after a challenging few months for the U.S. biotech.
Alexion’s flagship drug Soliris, which treats two rare blood disorders, has fueled much of the company’s growth, but looming competition and the drug’s slowing sales growth in recent quarters have made investors jittery.
Slow pipeline development, the termination of some clinical programs and the departure of Alexion’s top executives in the aftermath of a sales practices investigation have also eroded investor confidence.
Hantson’s appointment would remove uncertainty around Alexion’s strategy, Nomura Instinet analyst Christopher Marai said.
Hantson, who most recently helmed rare-disease drugs specialist Baxalta, takes the reins from David Brennan.
Brennan was named interim chief in December as then-CEO David Hallal and Chief Financial Officer Vikas Sinha stepped down a month after Alexion said it was probing allegations related to Soliris’ sales practices.
The company said in January the probe had found no instances of improper revenue recognition related to Soliris, but said it had identified a material weakness in internal controls over financial reporting for previous quarters.
Hallal had justified Alexion’s $8.4 billion purchase of Synageva Biopharma in 2015 by touting the blockbuster potential of enzyme replacement therapies Kanuma and SBC-103.
But Kanuma generated a paltry $29 million in sales in 2016 and Alexion said last month it was not planning more studies on SBC-103, opting instead to wait for early-stage data to decide the drug’s fate.
Hantson’s appointment marks “an effort to build out a clearer vision for Alexion based on internal pipeline buildout” to diversify beyond Soliris or to complement the drug, rather than a focus on selling the company,” Marai said.
Before his role leading Baxalta, Hantson was president of Baxter BioScience, where he led the build-out of a pipeline of early-stage experimental drugs.
Baxalta, which was bought by Shire Plc SHP.L in a $32 billion deal last year, was spun out of Baxter International Inc (BAX.N) in 2015.
Outgoing chief Brennan will remain on Alexion’s board and is expected to be appointed chairman at its upcoming shareholder meeting, the company said.
Reporting by Natalie Grover in Bengaluru; Editing by Anil D'Silva and Sai Sachin Ravikumar