What do you do after selling your company to Johnson & Johnson for nearly a billion dollars? Despite the Disneyland jokes making the rounds at Cougar Biotechnology Inc., Chief Executive Alan Auerbach is more likely to dust off one of his surfboards ?eventually.
Convinced of the promise of Cougar? experimental prostate cancer drug, the New Brunswick, N.J., health care giant announced May 21 that it would buy the six-year-old Westwood drug company for $894 million in cash. The $43-per-share price represents a 16 percent premium over the stock? closing price before the deal was announced.
The deal represents nothing less than a home run for Auerbach, a former industry analyst who had never run a company prior to Cougar. The entrepreneur is credited for bringing in the right employees and experts ?some tapped from nearby UCLA ?and keeping operating and R & D; costs under control by outsourcing many functions.
? had a lot of doubts myself in the beginning like a lot of people did because he didn? fit the usual profile of a scientist or company executive,?said analyst Simos Simeonidis at Rodman & Renshaw LLC. ?ut this is one of those rare cases where the CEO deserves a lot of the credit. He? going to get a lot of offers from people who want to see him do it again.?p>Venture capitalists approached Auerbach in 2003 with a proposal for what became a ?o-research, development-only?company. At the time, he was a biotech industry consultant with an investment bank.
The idea for the company was to test and market drugs that already had been developed in the laboratory, instead of the traditional approach of developing them from scratch. Cougar sought out and licensed three drugs and used existing facilities elsewhere for clinical trials.
The prostate cancer drug that attracted Johnson & Johnson has shown promise in trials reducing the size of tumors in men by lowering testosterone production.
Auerbach said that once the deal closes, he?l stay on for maybe six months and then move on to the next opportunity.
?es, I?l finally take a vacation, maybe do more surfing,?said Auerbach, known for his seven-day workweeks. ?t? been very flattering, the kinds of calls I?e been getting. It opens up a huge world of opportunities for me.?p>
Billionaire Professor
Veteran biotech executive Dr. Patrick Soon-Shiong, who had a recent big sale himself, also is being presented with new professional opportunities these days.
The former UCLA researcher, who last year sold generic drug maker APP Pharmaceuticals for more than $3.7 billion and recently retired as chief executive of Abraxis BioScience Inc., has been appointed executive director of the UCLA Wireless Health Institute. He also accepted a position as a visiting professor at UCLA, where he originally developed the nanotech drug delivery platform behind Abraxane, the fast-growing cancer drug developed by Abraxis.
The health institute, established in 2008, is a community of UCLA experts and industry partners from various specialties who are working to create wireless devices and other technologies to improve health care. Soon-Shiong? mission is to make the institute a more statewide collaboration.
?t fits a lot of what lot of what I do now,?said Soon-Shiong, who last month topped the Business Journal? annual 50 Wealthiest Angelenos list with an estimated $6 billion net worth.
Soon-Shiong? philanthropy has included funding for another institute, the Center for Health Informatics, which brings together computer scientists from UCLA, USC and other institutions to work on health care integration.
But don? expect Soon-Shiong to be pushing paper behind a desk anytime soon. He spends much of his time on campus checking out research projects he has helped fund. And his professorial duties will be more mentoring than classroom lecturing. Any compensation received from the university, he said, will be donated.
Short on Details
Last summer? closure of Century City Doctors Hospital has also claimed the Beverly Hills parent company that managed the short-lived surgical hospital. Salus Surgical Group LLC last month converted its Chapter 11 reorganization into a Chapter 7 bankruptcy.
The company? U.S. Bankruptcy Court filing lists assets of less than $50,000, liabilities of up to $100 million and 100 to 200 creditors. However, the filing is otherwise lacking detail, which is unusual since the first creditors meeting is set for June 3.
Randy Rosen, Salus?chief executive, claimed in a recent court filing that a vendor seized computer equipment containing the company? financial data, making it difficult to complete the Chapter 7 paperwork.
Staff reporter Deborah Crowe can be reached at [email protected] or (323) 549-5225, ext. 232.
