Biogen lands a CEO who can navigate turbulence

After searching for a new chief executive officer since May, Biogen Inc. has selected industry veteran Christopher Viehbacher, who previously led Sanofi and later worked in venture capital. It’s a solid choice. Viehbacher helped steer Sanofi through turbulent times and has the experience to do the same for Biogen.
Viehbacher will succeed Michel Vounatsos, who has led the company for the last five years and said he would step down after the implosion of the Alzheimer’s drug Aduhelm. When the treatment received a surprise approval from the Food and Drug Administration despite scant evidence of its benefits, Biogen unwisely slapped a high price tag on the drug. That attracted the attention of the Centers for Medicare and Medicaid Services and Congress; Aduhelm was ultimately sunk when CMS decided not to cover the drug until it saw data that proved its effectiveness.
But the company’s fortunes changed swiftly in September when late-stage data on another Alzheimer’s drug, lecanemab, turned out to be positive. The sudden potential of a multibillion-dollar blockbuster therapy surely changed the dynamics of its leadership search.
Viehbacher will need to work with Biogen’s development partner, Eisai, to clear a series of hurdles to bring lecanemab to the market, ensure insurers will cover it and then make sure patients line up for it. He will also need to help the biotech firm look outward, moving swiftly and decisively on attractive assets and technologies.
Viehbacher is up to the task.
Investors, who lifted the company’s shares more than 2.5% on Thursday, have been pushing Biogen to do substantive dealmaking, a wish that has a better chance of being realized now with Viehbacher at the helm. When he took over at Sanofi, the company was facing a series of patent losses that were unlikely to be solved by its drug pipeline, which was lackluster at the time.
In 2011, Viehbacher engineered Sanofi’s $20 billion purchase of Genzyme, adding a portfolio of rare-disease drugs and establishing the French firm’s presence in the US. He also wisely expanded Sanofi’s relationship with Regeneron, which yielded perhaps the most critical drug in the company’s portfolio, Dupixent. The medicine, which treats asthma, eczema, and more, is expected to reach peak sales of more than $13 billion.
Then in 2014, six years into his tenure as CEO, he was ousted by Sanofi’s board. At the time, the board chair publicly blamed Viehbacher’s management style, in particular criticizing his communication, which sometimes involved telling the media about big moves before sharing those plans with the board. But investors and analysts disagreed, with many arguing the staid company needed a manager with the swagger to make bold changes.
Now Viehbacher will face another difficult board — one that over the years has been notoriously divided between members pushing for transformative deals and those urging conservatism. The situation has left Biogen constantly on its back foot, moving too slowly on acquisition targets or partnerships.
The challenge ahead is well known. BMO Capital Markets analyst Evan Seigerman said Thursday morning in a note that Viehbacher is “well-equipped to move the company towards a new paradigm of growth, but we want independence as a new chapter emerges.”
Viehbacher’s track record suggests he’ll be able to wrest some freedom from the board. Let’s hope that leads to some intriguing additions to the Biogen pipeline.

—Bloomberg