ELAN CHIEF executive Kelly Martin will step down from his post in May 2012, 10 years after being brought in to turn the company around following an accounting scandal.
Mr Martin will continue to serve for one year thereafter as an executive adviser to the board, before leaving the company altogether.
“As a turnaround expert, there was always expected to be a limit to his participation within Elan,” said Sam Farthing, analyst at Merrion Stockbrokers.
In a statement yesterday, Elan said the board and Mr Martin had “agreed to transition his employment contract from an open-ended agreement to a fixed-term agreement” to “provide clarity and continuity on the executive leadership of the company”.
The company said the two-year timeframe would enable Mr Martin and the company’s board to conduct “a comprehensive succession process”. Mr Farthing said it suggested an “amicable separation”.
Mr Martin joined Elan with a reputation from his previous role at investment banker Merrill Lynch as a turnaround expert. At the time, he had no real experience in pharmaceuticals.
Having taken over a company in disarray, Mr Martin oversaw its turnaround and this year expects to return Elan to profit at the operating level for the first time in many years. However, despite bringing multiple sclerosis blockbuster Tysabri to market and overseeing the development of a promising Alzheimer’s disease pipeline, Mr Martin has struggled to invigorate the company’s share price.
He has faced some criticism over executive spending and over what some shareholders saw as a failure to properly market Tysabri, produced jointly with US group Biogen Idec. The terms of his new contract were not disclosed. Last year, Mr Martin earned $1.66 million (€1.36 million), including an $800,000 bonus, more than double the $830,500 paid in 2008. – (Additional reporting Reuters)
