Reuters and several other news outlets are reporting that Exelixis CEO George Scangos is being tapped as the next leader of Biogen Idec. It’s a curious choice, to say the least. Scangos heads up a small molecule, oncology-focused biotech that has yet to commercialize a product, and Biogen Idec has several biologic drugs on the market and multi-billion dollar sales.
So why Scangos? My only thought is that Biogen has been wanting for years to up its presence in the small molecule space, and Scangos certainly has experience on that front. Only it was a different ball of wax at Exelixis: all those small molecules in the pipeline, successful or not, were home grown. Biogen, on the other hand, has pretty much bought all the small molecules in its pipeline (see its 2006 acquisitions of Conforma Therapeutics, which brought a series of Hsp90 inhibitors for cancer, and Fumapharm, which brought the dimethyl fumarate BG-12, now in Phase III trials in multiple sclerosis). The other small molecule in its pipeline, the Parkinson’s drug vipadenant, was discovered at Vernalis. Do they think Scangos can lead them in the right direction?
It’s also worth noting that rogue investor Carl Icahn had just two months ago been pushing for a plan to split Biogen Idec into two companies: one focused on oncology, and the other on neurology. Most folks thought the idea was nuts; it would mean putting the majority of the big assets in one basket and creating an oncology company with one product on the market and an otherwise sparse pipeline. Bringing in someone who helped to build an oncology company from scratch might help matters.
Well, readers, I leave it to you. Is there any sense in this choice? Or has April Fools’ Day come early? What does it mean for the future of Biogen? Despite a resurgence of sales in its multiple sclerosis drug Tysabri, many believe its pipeline could use some work. Not to mention Exelixis—the company has hit a rough patch, losing two consecutive partners for its lead drug candidate, and laying off 40% of its staff earlier this year. Can either ship be righted with fresh leadership?
Update: Well, it’s official. Biogen announced the appointment of Scangos, and Exelixis said its former head of R&D Michael Morrissey, a PhD chemist, will become CEO as of July 15. Some small take aways from the brief conference call Scangos held with analysts this afternoon:
Biogen made a point of underscoring Scangos’ experience with biologics at Bayer, where he worked for a decade before his 14 years at Exelixis. The call clearly seemed crafted to quell any concerns that Scangos lacks experience commercializing products, particularly biotech products. And in his own comments, Scangos seemed to focus more on his time at Bayer, which included working on its hemophilia franchise and securing the company’s deal with Onyx Pharmaceuticals, than on his accomplishments at Exelixis.
Scangos emphasized several times the need to “take a hard look” at how R&D is done at Biogen. He said a pipeline review would begin immediately, in tandem with the search for a new head of R&D. I’m wondering what will go, since as it is the pipeline is not looking too beefy.
Leave a Reply