Billionaire investor Carl Icahn said he won the support of Institutional Shareholder Services Inc., a proxy adviser, for two of his candidates for the board of Forest Laboratories Inc.
ISS recommended Forest shareholders vote for Daniel Ninivaggi, Icahn Enterprises LP’s chief executive officer, and Pierre Legault, CEO of Stone Management LLC, Icahn, the New York-based drugmaker’s second-largest shareholder, said today in a statement.
Icahn said last month that Forest CEO Howard Solomon had refused to put two of his nominees on the board to end a second proxy fight in as many years. Icahn, who failed last year to get any of his four candidates elected, has criticized Forest’s management for what he says was a lack in preparation for the loss in March of patent protection on its top-selling drug, the antidepressant Lexapro.
“The fact that this very well respected proxy advisory firm concluded, and recommended, that the best path forward for Forest Labs includes a board with shareholder-nominated directors is very good news for all shareholders,” Icahn said in the statement.
Icahn recommended four candidates to the Forest board. The drugmaker is scheduled to hold its annual shareholders’ meeting on Aug. 15.
Forest fell 1.7 percent to $32.97 at the close in New York. The shares have declined 10 percent in the last 12 months.
ISS’s recommendation undervalues the company’s future sales, which may reach $6 billion by fiscal 2018, Forest said in a statement. The drugmaker said Icahn’s previous proposal to cut $500 million in costs would be “unrealistic, risky, and ill-considered.”
“We believe ISS’s recommendation for Icahn’s two other nominees is based on a flawed analysis that adopts Icahn’s fundamental misunderstandings of the company’s business model and strategic focus in support of a reckless, cost-cutting strategy with the potential to destroy value,” Forest said.