Ousted Sanofi CEO's PureTech Nabs $171 Million in London IPO
June 19, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor
Ousted Sanofi chief Christopher Viehbacher's new company, PureTech Health, has gotten a rousing reception during its public debut Friday, raking $171 million during its first day on the London Stock Exchange.
The Boston-based company, which is owned by a British organization, said that it will immediately roll those proceeds into advancing the business.
“The $171 million proceeds of the fund-raising will help PureTech bring our most advanced product candidates towards commercialization and launch," said Daphne Zohar, chief executive, in a statement.
In March PureTech said it had decided to take a run at the public markets, saying it had hoped to raise $160 million to list on the London Stock Exchange as soon as June. It met and exceeded that benchmark in a rare instance of British firm listing in lower-valuation territory of the LSE before attempting an American crossover.
In February, PureTech said Viehbacher had joined its board of directors and serves in an advisory capacity to the firm’s 12 pipeline companies. PureTech has already raked in $250 million in past private fundraisings.
PureTech made no mention of Viehbacher’s infamous exit from the French Fortune 500 drugmaker in October, when he was unceremoniously fired after continued tensions with the company’s executive management.
"It's has been a pleasure to know Chris for many years and I am very excited that we will be working together more closely now," said Robert Langer, PureTech co-founder and senior Partner. "The PureTech Board is delighted to have him join us and to have access to his insights as our pipeline advances toward commercialization."
PureTech has a varied portfolio of companies focused on identifying, inventing and commercializing new products and technologies in the healthcare sector. Its roster includes Vedanta Biosciences , Gelesis, Entrega, Folica, Karuna, Tal Medical and Akili Interactive Labs. Now is the perfect time to capitalize on the roaring bull market for biotech, said company execs Monday.
"With the acceleration of scientific discovery and the convergence of new and disruptive technologies being applied to life sciences, we believe the healthcare industry is on the cusp of a major transformation," said CEO Daphne Zohar.
PureTech’s board has a number of marquee-name advisors, including a former CEO of Pearson, Marjorie Scardino and former Pfizer Inc. research czar John LaMattina, but Viehbacher remains its most compelling participant thus far. Sanofi’s board of directors fired Viehbacher on Oct. 29 because of “strategic differences,” including Viehbacher’s plan to sell the company’s portfolio of mature drugs worth about $7.9 billion.
Although Viehbacher was popular with shareholders because he managed to double the firm’s stock price during his tenure, management had long been at odds with him, particularly because he was the first non-French Sanofi chief executive. When he moved his family to Boston last year, spending only about a third of his time in France, the board acted to remove him.
Still, after a months-long uphill battle to name a successor, Sanofi is once again receiving intense criticism from lawmakers this week, after the details of its compensation package for new Chief Executive Officer Olivier Brandicourt were branded excessive and “incomprehensible.”
Under the terms of his new contract, Brandicourt could walk off with as much as $4.5 million in a “golden handshake” payment in addition to making $4.76 million a year. That base figure is comprised by a fixed annual salary of $1.36 million a year, which is supplemented by a performance-related bonus of between 150 to 250 percent, as well as stock options and performance shares.
Sanofi has said the one-off $4.5 million payment is intended to be a “reimbursement” for benefits lost when Brandicourt left his job at Bayer AG to become Sanofi CEO.
That was much too sweet a deal for French government spokesman Stephane Le Foll, who told RTL radio the pay package was "incomprehensible"--especially for the country’s largest listed company.
"These people, when they have hardly taken the reins of a company--which is to say they haven't yet taken any risk--are already assured to get a disproportionate package," Le Foll said.
Former presidential candidate Segolene Royal, the current energy and environment minister, echoed Le Foll’s comments and admonished large companies, saying "some self-discipline is needed."
"Drugs are reimbursed by taxpayers, so it's all of the French people who pay into the health system and reimburse drugs who are going to pay the golden handshake," Royal said on BFM TV. "Some decency is in store, especially from a pharmaceutical company that lives off the social security system.”
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