Imclone chief resigns

Scott Tong Oct 10, 2006

TEXT OF STORY

MARK AUSTIN THOMAS: Remember the bio tech company Imclone? It was at the center of the Martha Stewart trading scandal. Now it’s back in the news. This time it’s about an ugly board fight involving activist investor and board member Carl Icahn. Marketplace’s Scott Tong has the skinny.


SCOTT TONG: Imclone chairman David Kies quit this morning following a high-profile spat with Icahn.

The billionaire investor owns 14 percent of Imclone and he’s complained about what he calls the company’s “sorry record” under Kies.

Icahn also reportedly nixed a deal for Imclone to be bought by another drug company.

JOHN COFFEE: His style is always to rattle the cage.

Columbia Law professor John Coffee says it’s rare for a stockholder to block a deal, especially in the boardroom, but Icahn’s a strong personality.

COFFEE: He may have a different acquisition in mind and the directors who left can’t endorse his vision. And see very little role in remaining in sort of a dissident position as a minority factions on the board of directors.

Whatever Icahn’s vision, the company’s future may be bumpy.

Imclone makes a big-time cancer drug, Erbitux and a competing product is about to hit the market.

I’m Scott Tong for Marketplace.

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