By Kendra Marr
Washington Post Staff Writer
Friday, June 27, 2008
MedImmune chief executive David M. Mott, who led the Gaithersburg biotech through years of rapid expansion and its sale to the British drug giant AstraZeneca, will leave the company at the end of July.
Mott, a former investment banker with no formal scientific training, did not indicate why he was leaving. His departure marks the end of the leadership that forged one of the local biotech community's most successful companies.
"He's going to take the summer to spend time with his family and friends and figure out what he'll do next, as he looks forward to the rest of his career," MedImmune spokeswoman Jamie Lacey said.
In the announcement yesterday, AstraZeneca named Tony Zook, chief executive of AstraZeneca's North American business and executive vice president of global marketing, MedImmune's interim head. Zook is based in Wilmington, Del. The company will be working with MedImmune's staff to replace Mott, Lacey said.
A year ago, AstraZeneca purchased MedImmune for $15.6 billion, one of the biggest drug company acquisitions in recent years. Mott stood to make more than $145 million from the deal. MedImmune detailed Mott's potential payday -- $133.5 million in stock-option payouts and $12.2 million in other payments -- in a Securities and Exchange Commission filing before the sale closed.
Mott agreed to stay at MedImmune for a year after the acquisition and got a bonus for doing so. His departure is the next logical transition in merging the two firms, said John T. McCamant, editor of the Medical Technology Stock Letter.
"David Mott is a CEO, not a cutting-edge scientist," McCamant said. "He wasn't an asset AstraZeneca acquired when they bought MedImmune."
In the months before the sale, Mott and MedImmune came under pressure from activist investor Carl C. Icahn, who said he was dismayed by the firm's "very lackluster management." Icahn had taken a stake in MedImmune and warned that he would shake up the board unless the company put itself up for sale.
At the time, MedImmune's lead drug, Synagis, was approaching its 10th year in the market. There was concern that Synagis, which is aimed at preventing respiratory infection in infants, might not repeat its high sales growth, threatening how the firm's stock might be traded.
So Mott went to his board of directors and recommended that they sell.
Six weeks later, following a competitive bidding war, AstraZeneca acquired the company.
David Brennan, AstraZeneca's chief executive, called the deal "a significant acceleration" for the firm's endeavor into biotech. Mott called the transition from independence to a unit of a big company "heart-wrenching and challenging."
"This isn't what we built MedImmune to do," Mott said in August. "The vision for all the entrepreneurs sitting in this room is probably not to sell your baby to a big pharmaceutical company."
But he conceded, "The rewarding part to me, which is kind of amazing, is how good it's actually turned out."
Mott remained chief executive of MedImmune and joined AstraZeneca's executive team as a senior member. AstraZeneca offered all of MedImmune's employees a bonus to stay and named MedImmune a wholly owned subsidiary.
Mott's exit tracks the typical business life cycle of a biotech entrepreneur, said John Holaday, chief executive of QRxPharma, a biotech firm based in Australia but run locally.
"It's indicative of growth of an industry," said Holaday, who previously co-founded Rockville's EntreMed in 1992. "Leaders within a company step aside, go out and do it again and do it again. That's why the industries in San Francisco and Boston are so mature."
As a company, MedImmune has helped usher an era of growth for the local biotech cluster.
Founded two decades ago by Wayne T. Hockmeyer, a former Walter Reed Army Institute of Research scientist, MedImmune has been homegrown in Maryland. Its best-selling drug, Synagis, was among the few local biotech drugs to succeed in the marketplace.
"It's done what other companies haven't been able to do before -- or since," Holaday said.
After Mott took the reins from Hockmeyer in 2000, he steered Synagis to nearly $900 million in sales, opened the company's new $88 million headquarters and expanded the workforce.
Mott was able to boast that the company had launched a number of drugs out of laboratories and into the marketplace.
His colleagues said Mott is a boss who rolls up his sleeves and digs in.
"He was an enormously effective leader," said H. Thomas Watkins, president and chief executive of Human Genome Sciences.
But there were also bad times for the company.
The launch of FluMist, a nasal flu vaccine, was taxing and disastrous. MedImmune was unable to win approval for vaccinating young children and the elderly. The drug suffered from poor marketing and difficulty storing the first-generation version, which had to be frozen.
When AstraZeneca acquired MedImmune, Montgomery County lost a drug company headquarters but gained an international pharmaceutical presence.
Whatever Mott decides to do next, he has a clearly established legacy, said David Edgerly, Secretary of the Maryland Department of Business and Economic Development.
"He elevated the stature of Maryland in the world life sciences community," he said.
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