Forest Laboratories Chairman & CEO to Challenge “Unwarranted & Unprecedented” Potential Action to Exclude Him from Federa...
April 13 2011 - 5:41PM
Business Wire
Forest Laboratories, Inc. (NYSE: FRX) today announced that
Howard Solomon, Chairman, Chief Executive Officer and President,
will challenge a potential action by the Office of the Inspector
General, Department of Health and Human Services (HHS-OIG), to
exclude him from participation in federal healthcare programs. Mr.
Solomon was notified yesterday of the potential action in a letter
from HHS-OIG.
The potential action emanates from matters that were settled by
Forest in 2010 with no finding of knowledge or wrongdoing by Mr.
Solomon. The only basis given in the letter notifying Mr. Solomon
of the potential action is that he is “associated with” Forest. The
letter gives Mr. Solomon 30 days to respond and say why he should
not be excluded. Should HHS-OIG determine after that that Mr.
Solomon be excluded, unless the effectiveness of such exclusion is
enjoined by a court, Mr. Solomon would be required to step down
from his present executive positions. Mr. Solomon plans to commence
immediate litigation to prevent such exclusion from taking effect
if HHS-OIG determines to proceed.
Board member and Chairman of the Audit Committee William J.
Candee III, speaking on behalf of Forest’s entire Board of
Directors stated, “It would be completely unwarranted to exclude a
senior executive against whom there has never been any allegation
of wrongdoing whatsoever. Mr. Solomon has always set a tone of the
highest integrity from the top. At Mr. Solomon’s direction, the
Company has significantly enhanced its sales force monitoring and
compliance procedures. We believe the potential HHS-OIG action may
well be beyond its legal authority.”
Continued Mr. Candee, “At no time during the government’s six
year investigation of Forest was Mr. Solomon ever accused of any
wrongdoing in connection with the matters settled in 2010. We are
hopeful that HHS-OIG will decide that the facts and circumstances
as to Mr. Solomon do not warrant an exercise of its exclusion
authority.”
Herschel S. Weinstein, Vice President and General Counsel
stated, “Numerous other major pharmaceutical companies have plead
guilty to much more egregious offenses, and none of them has faced
the exclusion of a senior executive who has not himself been
convicted of a crime or pleaded guilty to a crime. We believe that
HHS-OIG is contemplating using a statute that has never before been
used under these circumstances and would be exceeding the bounds of
its authority.”
Mr. Candee concluded, “Forest Laboratories is strong and
performing well, with new product launches and a product pipeline
that is among the finest in the industry, all developed under Mr.
Solomon’s leadership.
On November 10, 2010, the Company announced a series of
executive management promotions, including Elaine Hochberg,
Executive Vice President and Chief Commercial Officer, Frank
Perier, Jr., Executive Vice President Finance and Administration
and Chief Financial Officer, Dr. Marco Taglietti, Senior Vice
President Research and Development and President Forest Research
Institute, and David Solomon, Senior Vice President Corporate
Development and Strategic Planning, which were implemented to
ensure a successful CEO succession planning process at the
appropriate time. The Board continues to work on a succession plan
consistent with the management reorganization announced last
November. The Board is confident that Forest Labs has the right
team, structure and plan in place to ensure a seamless transition
to the next generation of leadership at the appropriate time and to
maintain our momentum, pursue our stated strategies, and continue
to deliver value for our shareholders should Mr. Solomon step aside
temporarily pending the outcome of litigation.”
Additional Background
As previously announced, Forest Pharmaceuticals, Inc., a wholly
owned subsidiary of Forest Laboratories, Inc., entered into a
global settlement in September 2010, as part of which the company,
among other things, pleaded guilty in November 2010 to two strict
liability, no-intent misdemeanor violations of the federal Food,
Drug and Cosmetic Act, relating to conduct that occurred almost a
decade ago involving the distribution and marketing of Levothroid
and Celexa. The company agreed to a total payment in excess of $313
million to resolve all criminal and civil claims.
About Forest Laboratories
Forest Laboratories’ (NYSE: FRX) longstanding global
partnerships and track record developing and marketing
pharmaceutical products in the United States have yielded its
well-established central nervous system and cardiovascular
franchises and innovations in anti-infective and respiratory
medicine. The Company’s pipeline, the most robust in its history,
includes product candidates in all stages of development across a
wide range of therapeutic areas. The Company is headquartered in
New York, NY. To learn more, visit www.FRX.com.
Except for the historical information contained herein, this
release contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
statements involve a number of risks and uncertainties, including
the difficulty of predicting FDA approvals, the acceptance and
demand for new pharmaceutical products, the impact of competitive
products and pricing, the timely development and launch of new
products, and the risk factors listed from time to time in Forest
Laboratories’ Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q, and any subsequent SEC filings.
Forest Road Acquisition (NYSE:FRX)
Historical Stock Chart
From May 2024 to Jun 2024
Forest Road Acquisition (NYSE:FRX)
Historical Stock Chart
From Jun 2023 to Jun 2024