Bristol-Myers Names New CEO as Andreotti Becomes ChairmanDrew Armstrong and Doni Bloomfield
Bristol-Myers Squibb Co. said that Giovanni Caforio will replace Lamberto Andreotti as chief executive officer, changing leadership at the company that has become one of the drug industry’s leaders in a new field of cancer treatments.
Caforio, 50, will take over as CEO on May 5, about 15 years after he joined Bristol-Myers, the company said in a statement. Andreotti, 64, has led the company since 2010. James Cornelius, the company’s current chairman, will retire and be replaced by Andreotti.
Under Andreotti, Bristol-Myers has been one of the U.S. drug industry’s brightest stars. The shares have almost tripled during his tenure, while the Standard & Poor’s 500 Pharmaceuticals Index almost doubled.
During that time, the New York-based drugmaker implemented what it called a “string of pearls” strategy, making small-and mid-size deals that helped build a portfolio of cancer drugs. That included the $2.4 billion acquisition of Medarex Inc., which gave Bristol-Myers Opdivo, a cancer drug that uses the body’s own immune system to fight tumors. It was approved for melanoma last year.
Caforio, who speaks five languages and is a doctor, worked at Abbott Laboratories for 12 years before joining Bristol-Myers as the head of its division in Italy, where he was born and educated. He went on to run the company’s oncology unit.
“In the style of Bristol, this is a very smooth transition and passing of the torch,” said John Boris, an analyst at Suntrust. Caforio “is ideally positioned to pick up the immuno-oncology strategy, which should see a great amount of clinical information this year,” drawing on experience as a physician who has run Bristol’s global oncology business.
Andreotti, the son of a former Italian prime minister, focused the company on cancer and away from other areas of disease. He exited the company’s diabetes efforts, selling its products to AstraZeneca Plc for as much as $4.3 billion.
Other deals weren’t as favorable. After spending $2.5 billion to buy Inhibitex Inc. and its hepatitis C drug, the company took a $1.8 billion writedown after a patient taking the drug in a trial died and others were hospitalized. The company later said it wouldn’t try and get a combination hepatitis C treatment approved in the U.S.
“Lamberto has made a personal choice to retire Aug. 3, just after his 65th birthday, and devote more time to his personal life,” Ken Dominski, a spokesman for Bristol-Myers, said in an e-mail.
Caforio is a reassuring choice, said Vamil Divan, an analyst at Credit Suisse Group AG.
“I wasn’t anticipating an announcement like this now -- there hasn’t been a lot of talk of succession plans,” Divan, who has a buy rating on the stock, said in a phone interview. “The timing was a little bit surprising, but I don’t think the choice was very surprising.”