By Josh Beckerman
Salix Pharmaceuticals Ltd. said President and Chief Executive
Carolyn Logan plans to retire by the end of January, months after
an accounting issue may have derailed the drug maker's
takeover.
The departure comes after the maker of the antibiotic Xifaxan
had to change its accounting last year in an indication that sales
of its drugs weren't as strong as Wall Street had expected. The
changes prompted a board review and were accompanied by the
resignation of Chief Financial Officer Adam Derbyshire.
The accounting issue also played a role in scuttling a potential
takeover of the North Carolina-based company last year by Botox
maker Allergan Inc., The Wall Street Journal has reported.
Chairman Tom D'Alonzo will become acting chief executive,
effective Jan. 30, and Senior Vice President and General Counsel
William Bertrand Jr. will be acting chief operating officer. The
company will hire a search firm to look for a CEO.
Ms. Logan, who has been the company's CEO since 2002, will
remain a consultant.
In November, Salix said inventory levels for its drugs were
months higher than that company had earlier signaled. The higher
inventory levels indicated Salix sold more to wholesalers than the
wholesalers have been selling to pharmacies.
That meant demand for Salix drugs may not have been as large as
its revenue in earlier quarters suggested, and the company might
not be able to match the same level of sales in future quarters
while wholesalers sell off their supplies.
In December, Salix unveiled plans to clear out its wholesaler
inventory and withdrew its guidance, saying the plan will hurt its
revenue in its current quarter and next year.
Salix's top-selling product is Xifaxan, an antibiotic that
treats traveler's diarrhea and a liver disorder that impairs brain
function.
In late trading, Salix shares rose 1.65% to $114.70.
Write to Josh Beckerman at josh.beckerman@wsj.com
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