Genzyme nets 22 per cent stake in Bioenvision

Our Corporate Bureau
14 July 2007

Cambridge, Mass-based Genzyme said it would remain a minority shareholder in the New York firm that shares with it the marketing rights to a children's leukemia drug.

Genzyme, however, said the shares it bought from insiders would give it some authority over future mergers.

Meanwhile, the man who led the revolt against Genzyme's $5.6 a share bid is flexing his power. Steve Rouhandeh, chairman of SCO Financial Group LLC, who holds 13 per cent of Bioenvision, said in a regulatory filing that he would exercise his right to place two allies on the board of directors. He also urged Bioenvision to put itself up for sale in the next six to 12 months.

Of the six total board slots, Rouhandeh said there are two vacancies now, as the Perseus Soros Biopharmaceutical Fund has sold its shares to Genzyme.

Rouhandeh also said that Bioenvision should end its licence agreement with Genzyme, which currently owns North American marketing rights for the children's leukemia treatment Clofarabine. Rouhandeh believes Genzyme has not done its part to promote the drug beyond its current use and alleges Genzyme has held back money and data from the collaboration.