Pfizer Chairman and Chief Executive Officer Ian Read gestures during a panel meeting at the World Economic Forum (WEF) in Davos, Switzerland, on Tuesday, January 17, 2017.
Simon Dawson | Bloomberg | Getty Images
Activist Starboard Value charged Pfizer Threaten lawsuits against former CEOs and CFOs to force them to Parting ways with investors’ nascent turnaround movement at the pharmaceutical giant.
In a letter to Pfizer’s board of directors on Thursday, Starboard managing member Jeff Smith said the company or its advisers had also “threatened” to withdraw past claims from former CEO Ian Reid and former CFO Frank D’Amelio. compensation, and cancel their unvested stock.
Smith asked the board to establish a special committee to investigate the matter, describing it as “grossly inappropriate, blatantly unethical, and a serious breach of fiduciary duty.”
A person familiar with interactions between the company and the two former executives said the risk of legal liability was a driving factor in Reid and D’Amelio’s public support for Pfizer CEO Albert Bourla late Wednesday night.
Pfizer’s stock price fell overnight as news broke of the departure of two senior executives, opening down about 2.5% in early trading on Thursday.
Starboard’s Smith said that when the activist approached the two executives, both expressed “concerns” about the direction of Pfizer under Bourla and offered to help Starboard turn around.
Starboard did not respond to a request for comment. A Pfizer spokesman declined to comment.
Starboard’s Smith and Bourla are scheduled to meet in person next week, Smith said, confirming previous reports. The agenda of the discussion was not known, but people familiar with the matter Starboard Thoughts Pfizer has previously said its focus on a strict cost structure and mergers and acquisitions suffered under Bourla.
