NitroMed Inc. replaced its chief executive officer and top financial manager after generic competition undercut the drugmaker's only product and the stock lost more than two-thirds of its value since July.
Chairman Jerry Karabelas, a shareholder, will replace Chief Executive Officer Michael Loberg temporarily, and former Millennium Pharmaceuticals Inc. executive Kenneth Bate will succeed Lawrence Bloch as chief financial officer, NitroMed said today. Each of the resignations was a ``mutual decision,'' said Jane Kramer, a company spokeswoman.
Loberg and Bloch helped steer the approval last year of the BiDil heart-failure treatment for black people, the first drug cleared in the U.S. for a specific race. Sales of BiDil, composed of two medicines already sold separately as cheaper generic drugs, have disappointed investors, said Liana Moussatos, an analyst with Pacific Growth Equities in San Francisco.
``People will call their doctor back and get a prescription for the separate medicines,'' Moussatos said in a telephone interview today.
Because insurance providers often charge patients more for brand-name drugs when less expensive copies are available, the portion that patients pay for the generic versions of the two medicines may be $20 a month compared with as much as $50 for BiDil, Moussatos said.
Before today, shares of Lexington, Massachusetts-based NitroMed had fallen 59 percent since BiDil's approval on July 23. The stock rose 73 cents, or 9.3 percent, to $8.56 as of 4 p.m. New York time in Nasdaq Stock Market composite trading, after climbing to $8.80.
Kramer declined to comment further on the reasons for the resignations of Loberg, 58, and Bloch, 40. Both departures were effective today. NitroMed first offered shares to the public in November 2003.
Karabelas, 53, formerly served as chief executive officer of worldwide pharmaceuticals at Basel, Switzerland-based Novartis AG. (NOVN)
He is a partner in the investment firm Care Capital, NitroMed's sixth-biggest shareholder. He also owns shares individually, ranking as the seventh-biggest investor.
Bate, 55, also becomes chief operating officer at NitroMed. He formerly served in several positions at Millennium including chief financial officer, and held the same post at Biogen Inc., now Biogen Idec Inc.
(To join the company's conference call to discuss the executive changes tomorrow at 10 a.m. New York time, callers in the U.S. should dial (1) (866) 770-7129 and others should call (1) (617) 213-8067 using passcode 90241061.)
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