Prepping for $25B merger, Actavis taps Forest CEO Saunders to lead combined company

When Actavis CEO Paul Bisaro announced his big buyout of Forest Laboratories, he sketched a picture of a brand-plus-generic powerhouse with lower costs and bigger revenue prospects. Now, it will be Forest CEO Brent Saunders who colors in those lines as chief executive of the merged company.

That doesn't mean Bisaro won't have significant power; he'll be executive chairman, a newly created post. Saunders, who joined Forest in September after selling Bausch & Lomb to Valeant Pharmaceuticals , is set to take the day-to-day reins as CEO and president. Actavis and Forest vets alike will fill out the executive team.

That team will have a big job ahead in integrating Actavis and Forest, one a generics leader, the other a mid-sized brand player with lots of generic competition and several new meds to pump up to size.

The $25 billion merger involves operations in multiple countries, some of them recently acquired as part of Actavis' 2013 buyout of the U.K. drugmaker Warner Chilcott. Cost-cutting comes with the territory, too, with Bisaro on record with a $500 million target by 2016.

The top appointments are part of an overall rejig of top Actavis management, with several newly created posts, including chief operating officer. The shuffle also includes farewells to a few top execs on both sides of the deal.

Actavis announced the leadership team Wednesday morning, "to ensure that we seamlessly operate as one global company on Day 1," Bisaro said in a statement. "These appointments reflect the increased size and complexity of the combined business, and the exceptional and complementary expertise of the Actavis and Forest management teams."

Robert Stewart, who previously served as Actavis operations chief, will take the new COO position. On the commercial side of the business, Forest EVP Bill Meury will become EVP of the new company's North American brands business. David Buchen, Actavis' top legal mind, will lead the commercial organization on the generics side in North America, and will spearhead the international business.

Among the departures is Sigurdur Olafsson, who's been president of Actavis Pharma. And then there's Howard Solomon, who founded Forest Laboratories and served for decades as its CEO; he stepped up to chairman last year to usher Saunders into that seat.

Read the press release from Actavis

Actavis plc today announced the proposed senior management team that will lead the specialty pharmaceutical company pending the successful close of the acquisition of Forest Laboratories, Inc., which is anticipated at mid-year.  Following the close, Paul Bisaro, Chairman and Chief Executive Officer of Actavis, will become Executive Chairman.  Brent Saunders, currently CEO and President of Forest, will become CEO and President, and a member of the Board of Directors.  Robert Stewart, President, Actavis Global Operations, will become Chief Operating Officer.  Mr. Saunders will report to Mr. Bisaro and the Board of Directors, and Mr. Stewart will report to Mr. Saunders.

"Consistent with the practice we established during the legacy Actavis acquisition in 2012, we are publicly announcing the proposed senior leadership structure prior to the close of the Forest acquisition, in order to ensure that we seamlessly operate as one global company on Day 1," said Mr. Bisaro.  "These appointments reflect the increased size and complexity of the combined business, and the exceptional and complementary expertise of the Actavis and Forest management teams.  Announcing Brent and Bob's appointments, as well as the extended senior leadership structure, permits us to more effectively define the cascading organization.  This will remove uncertainty during the integration planning phase prior to close, as well as ensure continuity of management in meeting our commitments to drive enhanced value following the close.  The proposed senior management structure reflects the wealth of exceptional pharmaceutical talent available from both organizations that will lead the new Actavis post close."

Paul Bisaro, Executive Chairman
In the newly created role of Executive Chairman, Mr. Bisaro will continue to lead the Company's Board of Directors, while maintaining his oversight of the strategic management of Actavis.  Mr. Bisaro, working closely with Mr. Saunders and the Actavis Management Team, will oversee the development of the Company's brand, generic, branded generic and OTC business growth strategies, as well as the identification and execution of mergers and acquisitions, including geographic and business unit diversification strategies and initiatives.  He will also continue to share in directing senior management team selection and retention; overall business integration initiatives; strategic planning for both organic and inorganic growth; and in conjunction with Mr. Saunders, continue to represent the Company with shareholders, investors and other critical audiences.

Brent Saunders, CEO and President
As CEO and President, Mr. Saunders will have responsibility for leading Actavis' approximately $15 billion global pharmaceutical business.  Mr. Saunders will have responsibility for all commercial and business functions, as well as the combined Company's finance, legal, human resource and corporate affairs activities.

"I am thrilled that Brent will be joining Actavis as CEO and President of our expanded organization, and accepting a seat on our Company's Board of Directors," said Mr. Bisaro.  "Brent is a proven leader with an in-depth knowledge of and passion for the pharmaceutical industry, whose record of success at Forest, Bausch + Lomb and Schering-Plough speaks for itself.  I am looking forward to working with him closely as we continue to build the new Actavis into a world-class company focused on sustainable double-digit growth."

"I am excited about working closely with Paul and the combined leadership team of the new Actavis to drive future growth and sustainable shareholder value creation," said Mr. Saunders.  "With our expanded geographic and therapeutic presence, I am confident in our ability to become even more relevant to key physicians and customers, to benefit from the unique combination of our global generic and brand business strengths and to continue to create a great place to work for our employees around the world."

Robert Stewart, COO
In the newly created position of Chief Operating Officer, Mr. Stewart will retain responsibility for Global Operations, Quality, Supply Chain, Procurement, Engineering and Security and Information Technology.  In addition, Mr. Stewart will retain responsibility for Global Brands, Generics and Biosimilars Research and Development (R&D), which he assumed earlier this year. 

"By adding the management of our more than $1 billion investment in global R&D to Bob's portfolio, we are now more efficiently aligned from development through delivery to customers," said Mr. Bisaro.  "The link between innovation, development, timely approval and flawless delivery is critical to our global success. Combining this function with the supply chain expertise of Bob and his team closes the last gap in creating the most efficient global operations organization in the industry." 

Bill Meury, EVP Commercial North American Brands and David Buchen, EVP Commercial, North American Generics and International
To support the combined Company's more complex generic, brand, branded generic and Over-the-Counter (OTC) global commercial operations, Bill Meury, currently Executive Vice President, Sales and Marketing for Forest, will assume responsibility as Executive Vice President Commercial, North American Brands at close.  David Buchen, currently Actavis' Chief Legal Officer, will assume responsibilities in a newly created position of Executive Vice President Commercial, North American Generics and International.  Both of these positions will report to Mr. Saunders. 

Sigurdur Olafsson, President, Actavis Pharma, has elected to leave the Company effective at the close of the transaction.  During the transitional period, Mr. Olafsson will continue to work closely with his commercial management team to ensure continued achievement of the Company's commercial objectives and support Mr. Buchen's transition.

"Bill and David will form a dynamic team in guiding our innovative new commercial organization," said Mr. Bisaro.  "Bill's extensive background across the Forest organization, including oversight of the company's Global Commercial and U.S. Marketing, Sales, Managed Care, Market Research, Commercial Assessments and Early Commercialization activities, will prove invaluable in leading Actavis' significantly expanded North American Specialty Portfolio and the continued growth of our blockbuster product franchises."  

"David brings nearly 20 years of experience within the pharmaceutical industry to his new commercial responsibilities, and his appointment to this position capitalizes on his intimate knowledge of our Company and the various mergers and acquisitions that have been instrumental in our evolution over the last several years," said Mr. Bisaro.  "His exceptional hands-on management of Paragraph IV litigation, intellectual property issues and global pharmaceutical regulations, among other areas, has been a fundamental component of the tremendous growth within our generic business.  I am convinced that David's breadth of business development expertise, both U.S. and international market intelligence and legal and regulatory experience represents a truly unique addition to the efficient management of our North American Generic and International commercial business."

"I would also like to acknowledge Siggi Olafsson's extraordinary personal and professional contributions to the monumental evolution of our Company since he joined in 2010," added Mr. Bisaro.  "Siggi has been tireless in his commitment to build Actavis into a global specialty pharmaceutical company, first in legacy Watson, then during the acquisition and integration of legacy Actavis, as well as the subsequent acquisitions that added strength and breadth to our global commercial position."

Proposed Senior Management Organization for Shared Services
To support the larger and more complex company, Actavis announced the senior management team for its Global Shared Services Functions, which will report to Mr. Saunders.  R. Todd Joyce will retain his Actavis position as Chief Financial Officer for the combined company.  Frank Perier, Chief Financial Officer of Forest, will provide transitional support during the integration process following the close.  Bob Bailey, Senior Vice President and Chief Legal Officer of Forest, will assume the position of Chief Legal Officer and Corporate Secretary, Actavis, previously held by Mr. Buchen, and will report to Mr. Saunders.

Karen Ling, Senior Vice President and Chief Human Resources Officer, Forest, will become Chief Human Resources Officer for the combined company at close, succeeding Patrick Eagan, Actavis Chief Human Resources Officer who will support the transition and integration through the end of 2014.  David Solomon, Senior Advisor to the CEO of Forest, will provide transitional support following the close.  Charlie Mayr, Chief Communications Officer for Actavis, will retain responsibility for Communications, Investor Relations, Public Relations, Government Affairs and Strategic Alignment.  Sigurd Kirk, Senior Vice President, Actavis Corporate Business Development, will retain responsibility for corporate business development.  Ms. Ling, Mr. Mayr and Mr. Kirk will report to Mr. Saunders.

The Company noted that it anticipates continuing to define the subsequent levels within the global organization between now and the close of the acquisition.