Elan investor wants rid of "arrogant" directors

Irish biotechnology company Elan faces opposition to its strategic restructuring, as shareholder Jack Schuler is calling for the firm's  co-directors to be replaced in order to prevent the sale of the  company's assets as part of a strategic restructuring (Marketletter  January 19).

Mr Schuler, a former president of US drug major Abbott Laboratories, is  leading a group of seven investors, holding a total of 37% of Elan's  shares, who think the options under consideration by the firm are  inappropriate. Mr Schuler says that current chief executive Kelly  Martin, a former banker, and chairman Kyran McLaughlin lack the  experience necessary to lead a pharmaceutical firm through troubled  times. He has written a letter to Elan's board, outlining what he sees  as their mistakes and calling for Bill Rohn, former head of Biogen Idec  and current Elan director, to take over as chairman.

In response, Elan's directors have sent a letter to Mr Schuler, which:  highlights the eight new appointments the firm has made in the last  three years; notes that it will recruit two new board members with  significant pharmaceutical and commercial experience before the end of  the second quarter; and insists that the board's current actions will  enhance the value of Elan. Additionally, Mr McLaughlin told the UK  Financial Times that Elan will continue to pursue a sale of 19% to 25%  of the company within the next 10 weeks and has "half a dozen"  interested buyers.