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Further exodus from Endo

Posted on 12 months ago by Gerry Kennedy

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Endo’s ($ENDP) CEO exodus is continuing. Its CFO is following its CEO out the door--to work for another drugmaker, no less.

Thursday, the Dublin company announced that financial chief, Suketu Upadhyay, would be hitting the road to “assume a senior-level finance position at a global biopharmaceutical company.” Blaise Coleman, Endo's SVP of Global Finance Operations, will step up in his stead while Endo searches for a permanent replacement.

It’s been a rocky financial year for Endo, which--much like Valeant ($VRX), a company whose footsteps it’s seemingly been following in for years--slashed its Q2 guidance earlier this year, and the 40% share-price decline that ensued locked up the stock’s second-worse daily performance ever. It also cut 740 jobs. The company blamed new rivals on the market, greater-than-expected generics price erosion, regulatory delays and more for a revised revenue forecast that hit well below analyst expectations.

But new Endo skipper Paul Campanelli--the former Par chief who relieved Endo’s Rajiv De Silva late last month--was quick to point out that the company recently reaffirmed its third-quarter and full-year predictions, an attempt to reassure investors that more bad news wasn’t on the way.

What may be on the way for the troubled drugmaker, though? Divestments. Late in June, Reutersreported that Endo--like Valeant--was looking for asset sales that could help pay down its acquisition-fueled debt mountain.  And Thursday, Campanelli noted that the specialty pharma would “complete a product-by-product assessment of our portfolio and further sharpen Endo's strategy and operational focus."

And analysts are already talking up potential takers. Earlier this week, RBC Capital Markets’ Randall Stanicky wrote in a note to investors that Endo’s pain business could make a good buy for California’s Depomed ($DEPO), which may scout for M&A now that it’s settled a proxy dispute with activist investor Starboard Value.