Forest Labs (FRX) Rebukes Icahn Comments
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Forest Laboratories, Inc. (NYSE: FRX) issued the following statement in response to a letter it received from Carl C. Icahn:
“We regret that Mr. Icahn has resorted once again to his tired playbook designed for maximum distortion, distraction and litigation rather than engaging constructively with the Company. Mr. Icahn continues to ignore the substantial progress Forest has made over the past year, including the launches of Teflaro, Daliresp and Viibryd in 2011 and the filing of NDAs for aclidinium and linaclotide, which we expect will be approved in the coming months. Instead, Mr. Icahn is simply recycling arguments that were rejected last year by the vast majority of Forest shareholders, and has nominated a director slate led by Eric Ende, who received the lowest number of votes of any of the fourteen nominees to Forest’s board last year. While we remain prepared to engage in a reasonable dialogue with Mr. Icahn, we think most people see through his attempt to reinvent himself as a ‘governance guru.’
“With respect to his comments about succession, the idea that Forest has been less than forthcoming could not be further from the truth. In November 2010, Forest announced a series of senior executive promotions, which were implemented to ensure a successful CEO transition at the appropriate time. As previously disclosed, the Company is engaged in ongoing succession planning, led by its independent directors, who have retained a leading executive search and recruitment firm to, among other things, provide internal candidate evaluation and external candidate benchmarking services. Howard Solomon is one of the most successful CEOs in the industry and it would be both inappropriate and unusual to announce his successor at this time.
“Mr. Icahn is also wrong when he states that Forest has not fulfilled its commitment to consult with a leading corporate governance expert. The Company has consulted with Dean Robert Clark of Harvard Law School, who has advised the Company on a range of topics, including the succession process. The Company has not only consulted with Dean Clark, but it has taken several steps to enhance its corporate governance, which are publicly available on the Corporate Governance section of the Forest website.”
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“We regret that Mr. Icahn has resorted once again to his tired playbook designed for maximum distortion, distraction and litigation rather than engaging constructively with the Company. Mr. Icahn continues to ignore the substantial progress Forest has made over the past year, including the launches of Teflaro, Daliresp and Viibryd in 2011 and the filing of NDAs for aclidinium and linaclotide, which we expect will be approved in the coming months. Instead, Mr. Icahn is simply recycling arguments that were rejected last year by the vast majority of Forest shareholders, and has nominated a director slate led by Eric Ende, who received the lowest number of votes of any of the fourteen nominees to Forest’s board last year. While we remain prepared to engage in a reasonable dialogue with Mr. Icahn, we think most people see through his attempt to reinvent himself as a ‘governance guru.’
“With respect to his comments about succession, the idea that Forest has been less than forthcoming could not be further from the truth. In November 2010, Forest announced a series of senior executive promotions, which were implemented to ensure a successful CEO transition at the appropriate time. As previously disclosed, the Company is engaged in ongoing succession planning, led by its independent directors, who have retained a leading executive search and recruitment firm to, among other things, provide internal candidate evaluation and external candidate benchmarking services. Howard Solomon is one of the most successful CEOs in the industry and it would be both inappropriate and unusual to announce his successor at this time.
“Mr. Icahn is also wrong when he states that Forest has not fulfilled its commitment to consult with a leading corporate governance expert. The Company has consulted with Dean Robert Clark of Harvard Law School, who has advised the Company on a range of topics, including the succession process. The Company has not only consulted with Dean Clark, but it has taken several steps to enhance its corporate governance, which are publicly available on the Corporate Governance section of the Forest website.”
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