Hollis-Eden Pharmaceuticals (NASDAQ: HEPH) said in a government filing yesterday that a special committee of the biotech’s board of directors has fired Richard Hollis, the company’s namesake and founding CEO.
In its notice, the San Diego company disclosed only that Hollis was terminated on March 18 pursuant to the section of his 1996 employment contract that details termination “for cause.” The San Diego Union-Tribune reported the firing this morning. The CEO’s employment contract was included in a 1996 filing that preceded the 1997 merger that enabled Hollis-Eden to become a public company.
In the employment agreement, such conditions include breaching an employment contract; participating in any activity or engaging in behavior that is competitive or injurious to the company; committing fraud against the company; improper use of company funds or property for personal use; or conviction of a crime.
Neither Hollis-Eden, which did not issue a press release about the matter, nor members of its board would comment further—and the newspaper reported that Richard Hollis could not be reached for comment.
The company’s chief operating officer, James Frincke, was named interim chief executive.
Hollis founded the biotech in 1994 to develop therapies based on a synthetic form of HDEA, an adrenal hormone that helps strengthen the body’s immune system. After the Sept. 11, 2001, terrorist attacks, the San Diego biotech made a fateful decision to develop Nemmune, a drug to treat radiation sickness. The company anticipated that the U.S. government would place a blockbuster order for the drug, but in 2007 the government officially announced it would not make such an order.
The company’s stock plunged and never recovered. Hollis-Eden shares were trading down from the opening at 42 cents a share earlier today.
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