Akorn searches for new CEO after failed Fresenius merger

US generics firm Akorn is searching for a new CEO in the wake of a failed merger with Fresenius Kabi last year.

Akorn had been set to merge with Fresenius Kabi in 2017, but the German pharma axed the deal citing problems with data integrity at the US pharma.

The deal was undone when whistleblowers from Akorn contacted Fresenius after the deal had been approved by shareholders in July last year, raising concerns about quality control.

Akorn’s business also declined dramatically after the merger was announced, with Akorn citing sudden and unexpected competition for its mainstay products as the cause.

At the time of shareholder approval Akorn was valued at around $4.3 billion, but since the deal fell through its value has slumped to less than $560 million.

Fresenius had asked the Delaware Chancery Court to allow it to walk away from the deal, and following an appeal from Akorn the Supreme Court of the State of Delaware upheld the decision.

Akorn CEO Raj Rai has now decided to retire and Akorn has begun a search for a replacement, although Rai will remain in his role until the company hires a successor.

Board chairman Alan Weinstein said: “We recognise that this has been an extended period of uncertainty for Akorn’s customers, employees and investors and the Board is committed to ensuring the company’s stability and long-term growth.

“While there is work to do, Akorn’s future remains bright thanks to its manufacturing, quality and generics expertise and is not dependent upon a consummated transaction with Fresenius.

“We thank Raj for his years of service with Akorn and his success in building the company into a leading organization in a highly competitive industry.”

Akorn noted that it has had several generics already approved by the FDA.

Fresenius saw its worst share price fall ever on Friday after it issued a profit warning, falling 17.71% to 38 euros.