Starboard Value challenges Pfizer with allegations of executive pressure, leading to a stock price decline.

From Investing.com: 2024-10-10 13:16:15

Activist firm Starboard Value challenges Pfizer, urging investigation into alleged coercive conduct by the board. Former executives Ian Read and Frank D’Amelio reversed support for the hedge fund’s campaign after threats of litigation. Pfizer’s stock price declined 11%, prompting Starboard to question company path and spending on mergers totaling $70 billion.

In a letter to Pfizer, Starboard’s Jeffrey Smith revealed pressure on Read and D’Amelio to support CEO Albert Bourla publicly or face clawbacks of compensation and stock units. The situation escalated with Guggenheim Securities stating the former executives withdrew from Starboard’s efforts. Pfizer has yet to comment on the matter.

Starboard hopes for constructive engagement with Pfizer as tensions mount ahead of their scheduled meeting. The hedge fund seeks action from Pfizer to address drop in stock price, spending on mergers, and underperformance of recent drugs. Pfizer’s stock currently trades at $29.60, down 50% from its pandemic-era high.

Pfizer, known for its COVID-19 vaccine, faces challenges with lower demand post-pandemic, disappointing drug data, and product withdrawals. Starboard, experienced in healthcare campaigns, aims to influence Pfizer’s strategic direction. The dueling statements indicate a deepening conflict between the two parties.



Read more at Investing.com: Pfizer fight with Starboard heats up, hedge fund alleges executive pressure By Reuters