Management shakeups at local biotechnology companies Optimer Pharmaceuticals Inc. and CryoPort Inc. are rattling the leadership but are not expected to have detrimental effects on long-term operations.
Optimer, a developer of hospital specialty products, replaced Michael Chang as chairman of its board of directors with Hank McKinnell, who was previously appointed lead independent director at a recent board meeting. Although, Chang remains as a director, the board has requested his resignation.
The company also announced recently that terminated Chief Financial Officer John D. Prunty is being temporarily replaced by Kurt Hartman, who serves as general counsel, chief compliance officer and senior vice president. The company is currently searching for a permanent CFO.
The board also terminated Youe-Kong Shue as vice president.
McKinnell said the issues surrounding the board’s decision relate solely to the company’s relationship with Optimer Biotechnology Inc., an independent, Taiwan-based affiliate that Optimer Pharmaceuticals has a 43 percent stake in, according to the company. Citing “certain lapses in corporate governance practices,” a company statement said Chang failed to “identify and effectively manage compliance, record keeping and conflict of interest issues in connection with OBI’s grant to Dr. Chang, potentially for the benefit of a third party, of 1.5 million shares of OBI.” Prunty and Shue’s dismissals were related to the belief of Optimer’s independent directors that both individuals failed to follow proper procedures when they became aware of the issues related to the issuance of the OBI shares to Chang, according to a statement.
“Clearly, we are disappointed that we had to take these actions,” said McKinnell, who previously served as chairman of the board and CEO of pharmaceutical company Pfizer Inc. from 2001 to 2006 and has served as a director for Optimer since January 2011. “However, the board believes they reflect the importance to the company of good corporate governance practices and that they are in the best interest of the company and its stakeholders.”
Optimer Pharmaceuticals said it has disclosed the matter to the relevant U.S. authorities and is cooperating with those authorities in reviewing the matter.
Pedro Lichtinger, who remains as CEO, said the company continues to perform well in the marketplace and expects to report May 3 that gross revenues for the first quarter 2012 increased to approximately $16.45 million, reflecting a 36 percent increase over gross revenues of $12.22 million for the fourth quarter 2011. Total revenues in 2011 were $145 million, compared to $1.5 million in 2010.