The highlight of Biogen’s first-half results statement was not the financial performance of the company but the news that chief executive George Scangos is to step down.
Biogen will start searching for a replacement for Scangos immediately, with a new CEO expected to be in place within the next few months.
Scangos has been CEO at Biogen for six years, and his departure comes after a disruptive period for the company’s top management following the departure of R&D head Doug Williams and commercial chief Tony Kingsley in recent months.
The company has also faced slowing growth for top-selling multiple sclerosis drug Tecfidera (dimethyl glutamate), which caused Biogen to miss annual sales and earnings targets and led to a reduction in workforce of around 11% last year and wiped a third off the value of its shares.
Biogen chairman Stelios Papadopolous said that despite joining Biogen at a challenging time, Scangos “re-organised operations and … oversaw the enrichment of our product pipeline and the launch of several products”.
“In short, George did an outstanding job and I believe he is leaving the company well positioned for success,” he added.
Speaking to investors yesterday, Scangos said it was an “excellent time for a transition” as Biogen has a new management team that is “extremely capable”, adding Mike Ehlers as head of R&D and Michel Vounatsos as commercial director earlier this year.
Meanwhile the commercial and R&D activities are going well, Scangos added, although he noted the pipeline needs to grow and “we’re on our way to adding to [it] through internal and external opportunities”.
Scangos’ departure comes as Biogen reported an improved set of financial results, with second-quarter sales of Tecfidera stabilising with a 12% increase to $987m compared to the same period of 2015, although older injectable MS treatment Avonex (interferon-beta-1a) fell 2% to $606m.
Long-acting Avonex follow-up Plegridy continued to gain ground – with sales up 65% to $123m – and there were also strong gains for Biogen’s haemophilia drugs Eloctate and Alprolix, which brought in $125m and $80m respectively.
Vounatsos highlighted the prospects for just-approved Zinbryta (daclizumab), a once-monthly MS therapy which is due for launch in the US and Germany next month, as well as the firm’s biosimilar pipeline. Biogen’s biosimilar version of Pfizer/Amgen’s big-selling tumour necrosis factor (TNF) inhibitor Enbrel – Benepali – got off to a good start with $15m in sales in the second quarter.
“Our results year to date have been better than expected,” said Scangos, noting that the three-pillared approach of cutting costs, boosting revenues and bringing through new pipeline products was bearing fruit.
However, “we can’t save our way to growth,” he stressed, adding that maximizing revenues and rapidly advancing the pipeline will be “front and centre” in the coming period.