(Corrects length of Vigodman's tenure in lead to 3 years)
* Erez Vigodman to step down immediately
* Shares have slumped in wake of patent setbacks,
* Investors call for major changes in the company
By Tova Cohen and Bill Berkrot
TEL AVIV/NEW YORK, Feb 7 The chief executive of
Teva Pharmaceutical Industries, the world's biggest
maker of generic drugs, stepped down after three years following
a series of strategic stumbles and legal and operational
setbacks that sent its shares plummeting.
Teva, Israel's largest company, said on Monday Chief
Executive Erez Vigodman was stepping down immediately and would
be replaced on an interim basis by Chairman Yitzhak Peterburg.
A string of questionable and costly acquisitions, along with
delayed drug launches, has prompted calls for a management
overhaul to lead sweeping structural changes - such as a spin
off of its branded drugs businesses and an increased pipeline -
to restore investor confidence.
Teva shares, which hit $72 in July 2015, tumbled to
a 10-year low of $32.20 last week on the New York Stock Exchange
after a U.S. court found patents invalid on Teva's most
important branded product, multiple sclerosis treatment
Copaxone. The drug accounted for almost a fifth of Teva's
revenue last year.
The shares fell more than 2 percent in extended trading
after Vigodman's departure, which comes after the head of its
generics drugs division, Siggi Olafsson, left the company.
Erez Vigodman joined Teva in 2014 after rejuvenating an
ailing Israeli agrochemical firm earned him a reputation as a
turnaround specialist and dealmaker.
But a series of stumbles have had investors calling for a
shakeup at Teva.
Vigodman embarked on a costly buying spree that culminated
in last year's acquisition of the Actavis generics drug business
for $40.5 billion - a price investors said was too high.
A $2.3 billion deal for Mexican drugmaker Rimsa has led to
both sides suing each other. Teva also paid $144 million to get
a migraine patch called Zecuity, but had to pull the product in
2016 after reports that patients were being scarred or burned.
In December it agreed to pay more than $519 million to
settle U.S. criminal and civil allegations that the company
bribed overseas officials to gain business for its medicines.
Last month Teva provided a 2017 revenue and profit forecast
below Wall Street's estimates.
Peterburg said he will conduct a thorough review of Teva's
business while the company searches for a permanent CEO. Former
Celgene Corp CEO Sol Barer will serve as Teva's new
RBC Capital Markets analyst Randall Stanicky said it is
unclear what this entails and whether asset sales could be a
part of this.
Some investors have told Reuters they would like to see Teva
spin off its specialty drug business.
"We find it interesting that Teva would pursue a review
before naming a permanent CEO, which may be suggestive of
further close involvement of the board and broader management
team," Stanicky said.
This will be a consideration for any incoming CEO, he added.
Bernstein analyst Ronny Gal, in a video released to clients,
called Peterburg "a good caretaker CEO, but clearly not a
candidate to run the company long term."
Prior to rejoining Teva's board of directors in 2012,
Peterburg led the company's research and development efforts as
head of global branded products, from 2010 until October 2011.
(Additional reporting by Steven Scheer, editing by Louise