There's nothing like a proxy fight to make you feel alive. Ina letter to the Securities and Exchange Commission, Carl proposes three board members for Biogen Idec and vows that "we are not seeking to immediately sell the company. Because of the failed sales process, we do not believe that now is the time to initiate another process."
He is referring, of course, to the fact that Biogen was unable to find a buyer last year, despite alleged interest from a few big drugmakers. Icahn prompted the episode by snapping up a chunk of the biotech and continues to complain that Biogen execs "doomed" a sale from the start. How so? He carps that they made it difficult for would-be buyers to explore Biogen's key relationships with Elan and Genentech.
"You have to ask yourself why the Board would adopt a process that made it difficult if not impossible for potential bidders to comply with if they really wanted to sell the company. Why put this roadblock in the way of the sale when it almost certainly ensures failure?" he writes to Biogen investors.
So Carl is proposing a trio who, he vows, who have investors interests in mind. Two of them are Alexander Denner, a managing director of Icahn Partners, who holds a doctorate in biomedical engineering, and Richard Mulligan, a professor at Harvard Medical School, both of whom, Carl says, "led the recent turnaround of ImClone Systems."
The third nominee is Anne Young, chief of neurology service at Massachusetts General Hospital, whose background would seemingly dovetail with Biogen's mission, since the biotech is the world’s largest maker of drugs for multiple sclerosis. "It seems strange to us that Biogen does not have someone with her expertise in neurology on its board," he writes.
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One wonders how much Icahn, Loeb et al. really understand about biotech and pharma and the conduct of said business. His suggestion of a lack of neurology knowledge at Biogen on board level (as opposed to SAB and staff scientists) really says it all. He may be a great corporate activist but he fails to recognize and understand the time value of intangible assets, undervalued assets. Since several years Lehman has pointed out in the PharmaPipeline analysis that early stage assets (ie <Phase III) are not recognized in company valuations. Do they therefore real have no value ? To do have a value if groomed properly. Icahn et al though go for the quick bang and grooming is not part of that thinking.