Former Pfizer CEO Ian Read and ex-CFO Frank D’Amelio said Wednesday evening that they would step away from Starboard Value’s campaign at the struggling pharmaceutical giant, just days after news of the activist’s stake broke.
Read and D’Amelio said they were “fully supportive” of Pfizer CEO Albert Bourla in a joint statement made via an investment bank and confirmed to be authentic. The duo had been in contact with a number of directors shortly before news of Starboard’s stake broke Sunday evening, according to people familiar with the matter.
“We are confident that over time they will deliver shareholder value,” the two former executives said of Pfizer’s current board and management. The company’s shares are essentially flat for the year and are off by roughly 50% from their 2021 highs.
The statement was made through Guggenheim Securities, which has long advised Pfizer on dealmaking. A representative for the bank declined to comment beyond the release.
The about face comes as Pfizer’s board grapples with the activist’s efforts, and just days before Starboard’s Jeff Smith was slated to meet with CEO Bourla, said people familiar with the matter. For executives to join, and then walk away from an activist’s campaign is highly unusual.
It was also not immediately clear what impact, if any, the breakaway would have on Starboard’s campaign. A representative for the activist fund did not immediately return a request for comment. Starboard, one of the largest and most tenacious activist funds, has amassed a roughly $1 billion position in the pharmaceutical firm, CNBC previously reported.
Jeff Smith, the managing member at Starboard, has previously mounted campaigns at Autodesk and Salesforce in recent months. While it typically focuses on the technology sector, it also built stakes in Starbucks and Wall Street Journal parent News Corp this year.
Representatives for Pfizer did not return requests for comment.