Abbott Must Hand Over CEO Emails: Biotech's Latest Trials and Tribulations

|
Includes: ABT, BSX, NVS
by: The Burrill Report

A federal judge ordered Abbott Laboratories (NYSE:ABT) to turn over some emails of its CEO and two other executives to prosecutors as part of a federal probe into whether the company violated the law by marketing its biopolar drug Depakote for uses not approved by the U.S. Food and Drug Administration, Pharmalot reported. The order covers emails sent over a 12-year period. The U.S. Attorney for the Western District of Virginia is investigating Abbott for potential federal violations relating to off-label marketing of Depakote as a treatment for agitation and aggression in the elderly, and health-care fraud arising out of that allegedly improper use.

Swiss drugmaker Acino said recalls in a number of European countries of its generic version of the heart drug Plavix would take a toll on its financial performance, Reuters reported. Acino said it could not yet quantify the actual cost, but that it would have a “significant negative impact” on its 2010 results. The decision by a number of European health authorities comes after the European Medicines Agency recommended a recall because the factory in India that produces the active ingredient in the drug failed to comply with good manufacturing practice standards.
The City of Roseville Employees’ Retirement system has filed suit against Boston Scientific (NYSE:BSX), alleging the medical device company misled investors over its business prospects for its cardiac rhythm management business, Reuters reported. The suit, which seeks class action status for investors who bought Boston Scientific shares from April 20, 2009 through March 12, 2010, charges the company made false statements and failed to disclose material facts regarding risks to its business, causing the stock to trade at artificially inflated prices. It said the company misled investors when it claimed its cardiac rhythm device business had stabilized after the 2006 acquisition of Guidant and was set to grow with the introduction of new products.
Sigma Pharmaceuticals said its CEO and Managing Director Elmo de Alwis resigned. The move follows a record loss for the Australian drug company last month that wiped away half of the market value of the company, Bloomberg reported. De Alwis told Bloomberg that “It’s something that I have to take responsibility for.” De Alwis, who has worked for Sigma for 33 years, said he wasn’t asked by the board to resign and will remain in the role until a replacement is found. He has served as CEO for ten years.
Novartis (NYSE:NVS) is reorganizing its U.S. pharmaceutical operations, a move that includes the elimination of 383, according to an internal email posting on the In Vivo blog. The email also stated that Ludwig Hanston, CEO and head of North American Pharmaceuticals for Novartis, is stepping down for an “external opportunity.” He had been in the post for about two years. Novartis will create four new business units focused around primary care, multiple sclerosis, psychiatry/neuroscience, and respiratory/transplant/infectious disease.