Novartis has announced its head of global drug development James Shannon will step down on April 1.

The Basel, Switzerland-based company confirmed to "The Pink Sheet" Daily that it informed employees on March 19 of Shannon's imminent departure.

Late last year, when the company announced massive restructuring of the pharmaceuticals division to deal with financial woes, CEO Daniel Vasella stressed Shannon's role in the planned turnaround (¹ Also see "Novartis Plan To Save $1.6 Billion By 2010 Includes Cutting Another 2,500 Jobs" - Pink Sheet, 13 December, 2007.):

"James Shannon will go live with the new organization, then throughout 2008 and partially 2009 we will make sure we have all the capabilities and the talent in place to also make a visible impact on the progress of our pipeline," Vasella said at the time.

Shannon has opted to leave in order to "pursue other opportunities," Basel, Switzerland-based Novartis told "The Pink Sheet" DAILY.

Taking Shannon's place as head of global development is Trevor Mundel, who is based in the company's Cambridge, Mass., office. Unlike Shannon, though, Mundel will not have responsibilities of chief medical officer, Novartis told "The Pink Sheet" DAILY.

On Feb. 14, the company announced that Alex Gorsky, head of North American pharmaceuticals, was leaving for a position with Johnson & Jonson unit Ethicon.

The company has faced challenges of late, including a hold its NDA for the oral type 2 diabetes drug Galvus (vildagliptin). The FDA said that it needed a very large study to support the agent's safety, and Novartis has been unsure about whether such a hefty investment was worthwhile, absent a guarantee for U.S. approval (² Also see "Galvus Won’t Proceed In U.S. Without More FDA Clarity On Prospects, Novartis Says" - Pink Sheet, 17 January, 2008.).

On March 11, a class-action lawsuit was filed against Novartis for its handling of the Triaminic line of products for daytime coughs and colds. The suit, filed in the U.S. District Court for the Central District of California, alleges the company did not act fast enough in withdrawing medications for children, despite knowing of potential dangers.

Novartis's fourth-quarter profit for 2007 was down 42 per cent to $931 million, a decline attributed to a restructuring charge, loss of patented drugs and rising competition from generics. The company announced plans for mass layoffs late last year, including 1,260 staff cuts in the U.S. and another 2,500 eliminated positions worldwide. The cuts are intended to help the company cut spending by $1.6 billion before the end of 2010.

- Emily Hayes (e.hayes@elsevier.com)

Drug Development Chief Departs Beleaguered Novartis

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