Former Pfizer CEO Ian Read and ex-CFO Frank D’Amelio announced on Wednesday evening that they would withdraw from Starboard Value’s campaign at the struggling pharmaceutical giant. This decision came shortly after news of the activist’s stake became public. In a joint statement conveyed through an investment bank, Read and D’Amelio expressed their full support for Pfizer CEO Albert Bourla. They had been in communication with several directors just before the news of Starboard’s stake emerged on Sunday evening.
The two former executives conveyed confidence in Pfizer’s current board and management, believing that they would create shareholder value over time. Despite the company’s shares remaining relatively unchanged for the year and dropping by about 50% from their 2021 peak, Read and D’Amelio expressed optimism in the company’s future prospects.
The statement was issued through Guggenheim Securities, a firm that has a history of advising Pfizer on business transactions. A spokesperson for the bank refrained from providing further comments beyond the official release. The sudden change in direction occurred as Pfizer’s board grapples with the activist’s initiatives, just before Starboard’s Jeff Smith was scheduled to meet with CEO Bourla.
The decision of the former executives to initially join and subsequently withdraw from the activist campaign is considered highly unusual. The potential impact of their departure on Starboard’s campaign remains uncertain, as a representative for the activist fund did not respond immediately to requests for comment. Starboard, known as one of the largest and most persistent activist funds, had reportedly accumulated a stake of approximately $1 billion in the pharmaceutical company.
Jeff Smith, the managing member at Starboard, has previously led campaigns at companies like Autodesk and Salesforce. While the fund typically focuses on the technology sector, it has also invested in companies such as Starbucks and News Corp this year. Requests for comments from Pfizer representatives were not answered promptly.
