Bayer healthcare chief quits
pharmafile | October 21, 2003 | News story | |Â Â Â
The head of Bayer's healthcare unit, Frank Morich, has resigned as troubles at the German company continue.
Bayer is cutting back expenditure to tackle falling profits as the Lipobay withdrawal and business restructuring headaches continue, but still has debts of almost $12 billion, following the purchase of Aventis Crop Science.
A downturn in the polymers and chemical markets is also having a serious affect on the conglomerate's profitability.
The departure of Mr Morich is seen as evidence of Chief Executive Werner Wenning's determination to overhaul the company into a 'new Bayer'. A source close to the company told the Financial Times: "Mr Wenning is looking to put together a perfect team it is only natural that some managers will fall victim to that."
The reorganisation, which Mr Wenning had earlier said was "more profound than any other in the history of the company", will see the formation of independent subsidiaries healthcare, crop science, polymers and chemicals within a single Bayer holding company.
Mr Wenning said the new structure would build a more transparent, flexible and entrepreneurially strong group of companies.
"This is not a short-term decision",said the company, on the cuts. "it was made when we realised the economic situation as a whole was not developing as everyone expected. We are cutting back as far as possible."
One analyst warned that this was a dangerous move, saying it could "destroy" the company value over time.
Dr Morich will be replaced by the company head of Diagnostics, Rolf Classon, who will also become Chairman of the healthcare division's executive committee.
Meanwhile, Bayer has agreed to sell part of its agrochemicals unit to BASF as part of a condition imposed by the European Commission and US Federal Trade Commission during the Aventis Crop Science acquisition. The deal, which covers selected insecticides and fungicides, is worth around $1.1 billion.
Bayer has had some good news in the shape of successfully defending antibiotic Cipro from generic competition. The drug's patent has been upheld until the end of 2003 by a US Court in Washington DC following attempts by generics manufacturers to have the patent overruled.
