Genzyme Boosts Power of Lead Independent Director
From Associated Press (January 29, 2010)
CAMBRIDGE, Mass.--Biotechnology company Genzyme strengthened the authority of its lead independent director and named new members to the board of director’s audit committee.
The announcement was made Friday as activist investor Carl Icahn boosts his investment in the company. Icahn has initiated several proxy contests in the last few years with biotech companies. Currently, he is trying to nominate three people to Biogen Idec’s board of directors.
Genzyme has been grappling with a series of manufacturing problems that hurt its profit and share price. In June, the company shut down its manufacturing plant in Boston to clean up viral contamination that had been slowing down production of two drugs. The shutdown cost the company millions in revenue. Production restarted in September.
Then in November, the Food and Drug Administration said it found tiny particles of trash in drugs made by Genzyme, including steel, rubber and fiber.
This month the company hired a new head of quality control to oversee products made at 17 sites worldwide.
Under the new structure announced Friday, Genzyme’s lead independent director will have an expanded role in determining the direction of the discussions that take place at the board level, including the approval of full board meeting agendas and materials.
Robert Carpenter, president of the privately held investment company Boston Medical Investors Inc., is the lead director. The role will have a three-year term.
The company also named director Robert Bertolini, the former executive vice president and chief financial officer at Schering-Plough Corp., to chair Genzyme’s audit committee.
The board also recently approved changes to the company’s governance guidelines, to reflect that at least two-thirds of the board consist of independent members. Previously, guidelines only required half of the board to be independent.
The board has nine members, eight of which are independent, the company said.
Shares of Genzyme Corp. fell 6 cents to $54.06.
Posted: January 2010