Optimer Consider Strategic Alternatives as CEO Steps Down
Optimer Pharmaceuticals Inc. (OPTR), a maker of an antibiotic to treat deadly hospital infections, said it will consider “strategic alternatives” for the company, sending its shares up the most in almost four years.
Chief Executive Officer Pedro Lichtinger, 57, will leave, the result of a stock deal that also spurred the resignation of former chairman Michael Chang last year, Optimer said today. Lichtinger will be replaced on an interim basis by former Pfizer Inc. (PFE) CEO Henry A. McKinnell Jr., who took over as board chairman in April, the San Diego-based drugmaker said in a statement.
Optimer, with a market value of $578.5 million as of today’s close, may become a target for Pfizer, the world’s biggest drug company, or Johnson & Johnson (JNJ), the biggest global maker of health-care products, said Brian Skorney, a New York- based analyst for Robert W. Baird & Co. Its value may be hampered by investigations into the stock deal, Skorney said in a telephone interview.
“People are going to read into this that the company is now for sale, which it clearly is,” Skorney said. “The question is, what sort of value can we get from an acquirer at this point given there has to be some kind of legal liability attached to it.”
Astellas Pharma Inc. (4503), a Tokyo-based company that markets Optimer’s antibiotic in Europe, is another logical suitor, Skorney said. He doesn’t expect Cubist Pharmaceuticals Inc. (CBST), Optimer’s marketing partner in the U.S., to be interested because it is developing a competing product.
Marko Kozul, a Leerink Swann & Co. analyst in San Francisco, disagreed on Cubist. It’s a likely bidder because its rival antibiotic may not be ready until 2017, he wrote in a note to clients.
Optimer rose 13 percent to $12.13 at the close in New York, its biggest one-day increase since May 2009. The shares have lost 7.3 percent during the last 12 months.
Julie DiCarlo, a spokeswoman for Lexington, Massachusetts- based Cubist, declined to comment on the prospects for an acquisition. Joan Campion, a spokeswoman for New York-based Pfizer, said the company doesn’t comment on speculation.
“As a matter of policy, we don’t comment on market rumors and speculation,” said Al Wasilewski, a spokesman for New Brunswick, New Jersey-based J&J. Jenny Kite, a spokeswoman for Astellas, declined to comment.
Optimer “cautioned that there can be no assurance that the strategic review will result in any action” and said it would have no further comment during the review. David Walsey, Optimer’s vice president for investor relations and corporate communications, didn’t return a phone call seeking more details.
The board is “conducting a comprehensive review of strategic alternatives to maximize shareholder value,” McKinnell said in the statement.
The company won U.S. approval in 2011 to market Dificid. The antibiotic treats a bacterium linked to intestinal infections in hospitals.
McKinnell was appointed board chairman after Optimer stripped the position from Chang in connection with a grant of 1.5 million shares he received from a Taiwanese affiliate, the company said in a statement in April. Then-Chief Financial Officer John Prunty and Youe-Kong Shue, a vice president, were also let go for failing to follow proper procedures after learning of the grant, the company said.
Optimer today said Lichtinger, president and CEO since May 2010, would leave because of “prior compliance, record-keeping and conflict-of-interest issues” stemming from the conduct that led to last year’s moves. U.S. authorities are investigating, Optimer said, without providing more details.
JPMorgan Chase & Co. (JPM) and Centerview Partners LLC have been hired to advise on the review of the company, Optimer said. Sullivan & Cromwell LLP will act as legal adviser.
Optimer’s revenue is projected by analysts to more than double to $310 million by the end of 2017 from 2011, data compiled by Bloomberg show.
Fourth-quarter earnings were 2 cents a share, Optimer said today. Analysts had expected a 55 cent loss, according to the average of four estimates compiled by Bloomberg. The company is scheduled to report full results tomorrow.
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