Lundbeck CEO Kåre Schultz will move to the top job at Teva, ending the Israeli company’s month-long search for new leadership and driving up its ailing share price.
Schultz takes up the CEO position at Teva at a challenging time, with sales slumping and thousands of jobs culled as a result of pressure on its generic drugs business, mainly due to pricing pressure, and the lingering effect of losing patent protection for multiple sclerosis blockbuster Copaxone (glatiramer acetate). He is being handsomely paid to work some turnaround magic, with a $40m package of cash and stock just for joining the company, according to some reports.
The appointment comes after seven months without a permanent CEO after Erez Vigodman stood down in February by ‘mutual agreement’ with Teva’s board, setting Teva the task of finding its fourth CEO in six years. AstraZeneca CEO Pascal Soriot and Celgene’s chief operating officer Jacqualyn Fouse have both been linked with the job in the interim.
Teva said in a statement that 56-year-old Schultz brings 30 years of experience in the pharma sector and has achieved a significant turnaround of Lundbeck’s business, including a “top to bottom” evaluation of the business and the implementation of cost-cutting measures while “targeting new product launches”.
Schultz will replace interim CEO Yitzhak Peterburg, taking up the role after Teva has already announced a big restructuring programme that will include several thousand job losses and close 15 manufacturing sites. It’s a familiar process for Schultz, who lost no time before implementing a similar cost-cutting drive when he took the helm of Lundbeck in 2015, having missed out on the top job at former employer Novo Nordisk.
“What drew me to Teva, and what makes Teva different from its peers, is its unique commitment to growing an extensive global reach while continuing to provide new and high-quality treatments for patients and an innovative culture for its employees,” said Schultz. “I am proud to be joining a company that helps millions of patients around the world on a daily basis with its broad range of generic and specialty drugs and solutions.”
Shares in Lundbeck went into steep decline on news of the defection, with Schultz’s departure coming at the same time as the resignation of chief commercial officer Staffan Schüberg, although the company insisted that is a coincidence.
“The process of finding a replacement for Kåre Schultz and Staffan Schüberg will commence immediately and both will remain in their respective positions until further notice,” said Lundbeck in a statement.
“It is very unfortunate that both Kåre and Staffan will be leaving around the same time,” said Lundbeck chairman Lars Rasmussen. “However, they are leaving Lundbeck at a time, where Lundbeck is strong and healthy, and with solid momentum on a clear strategic direction.”