Henri Termeer has invested most of his professional life building Cambridge, MA-based Genzyme (NASDAQ:GENZ) into a global biotech powerhouse, and it could all come to an unceremonious end if French drug giant Sanofi-Aventis (NYSE:SNY) succeeds in its efforts to acquire the company. Yet people close to the Genzyme CEO tell Xconomy that Termeer has plenty of unfinished business, and isn’t nearly ready to leave.

Termeer, who joined Genzyme in 1983 as president and became chief executive in 1985, is credited with leading the company’s evolution from a Boston startup into a multibillion-dollar global enterprise with about 12,000 employees. But over the past year and a half, his sterling record at the company has been tarnished by the viral contamination found at its Allston Landing plant last June and the resulting shortages of its therapies for genetic diseases. A growing chorus of critics, including the powerful activist investor Carl Icahn, has called Termeer’s leadership into question.

Nevertheless, Termeer, 64, has shown few signs that he’s ready to call it quits. Termeer, who is the firm’s chairman, and the rest of Genzyme’s board last month rejected Sanofi’s unsolicited offer to acquire the company for $18.5 billion. This month, Genzyme announced that it is selling its genetic testing unit and cutting 1,000 workers to improve the company’s bottom line and future prospects.

Though Termeer has told the media that he’s open to selling the company, some observers have their doubts. ”Henri does not want to sell the company. Henri never would want to sell the company. He’ll fight it tooth and nail to the extent that he can,” said a former Genzyme executive who asked not to be named. “He has to officially act in the shareholders’ best interest. The trouble is that his view of the shareholders’ best interest is probably not the same as what some of the shareholders think are their best interest.”

Genzyme declined a request to interview Termeer for this story.

He certainly isn’t the first CEO willing to put up a fight to keep his company independent. But Termeer is somewhat unique among biotech chief executives, many of whom build their companies to be sold or dream of the day when a large drug maker will come along with a multibillion-dollar buyout bid.

“I’ve known Henri for many years, and he never … Next Page »

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Genzyme has forged a peace treaty with the billionaire shareholder Carl Icahn, after months of debate about the future of the embattled company. Cambridge, MA-based Genzyme (NASDAQ:GENZ) has agreed to appoint two of Icahn’s associates to its board in return for Icahn’s support for Genzyme’s nominees, the company reports this morning.

Icahn, who controlled 4.9 percent of Genzyme’s stock as of May 4, will now vote all of his shares in favor or Genzyme’s 10 nominees at its annual meeting next week on June 16. That includes Genzyme’s leader of the past 25 years, chairman and CEO Henri Termeer, who Icahn previously wanted to oust from the board. Genzyme’s board will then appoint Icahn’s two associates, Steven Burakoff and Eric Ende, who are physicians by training, to serve as directors after the annual meeting. They aren’t the only new blood in the Genzyme boardroom. On Monday, the company said it would add Dennis Fenton, a former Amgen executive, to board after the meeting. And Genzyme previously reached an agreement with San Diego-based activist investor Ralph Whitworth to provide him with a seat at the table. So the board, which now has 10 members, would grow to 13 members after next week’s annual meeting.

It’s tough to say whether Icahn or Termeer won this round. Icahn had originally sought to win four of 10 seats on the Genzyme board. His original nominees included himself, Burakoff, Alex Denner, and Richard Mulligan. Now he’s settling for two seats on a board that is expected grow to 13 members. Yet Icahn said in a statement that he supports the nomination of Fenton, whose background in operations at Amgen will bring some much-needed bio-manufacturing expertise to Genzyme. The whole proxy fight, after all, was sparked by expensive mishaps at Genzyme’s drug plants in Allston, MA, and in Ireland over the past year. Icahn also noted in today’s joint statement from Genzyme that  Whitworth was a good addition to the board.

“I am always pleased when a proxy fight can be avoided,” Icahn said in a Genzyme-issued statement. “New oversight at the director level will help this great company achieve its full potential.”

Still, the agreement effectively dilutes the power of individual directors because it expands the number of seats on the board by two. (Genzyme revealed earlier this month that it would grow the board from 10 directors to 11 with the addition of Fenton.) Termeer, if shareholders re-elect him to the board, gets to remain a director.

Genzyme can claim some degree of success in that it is keeping Denner, an Icahn fund manager, and Mulligan, the Harvard genetics professor, off the board. Genzyme had argued that Denner and Mulligan would have a conflict of interest as board members because they already serve as directors of Cambridge, MA-based Biogen Idec (NASDAQ:BIIB), and both Biogen and Genzyme develop drugs for multiple sclerosis. Biogen is the world’s largest provider of MS drugs. Genzyme is developing alemtuzumab (Campath) for patients with the neurodegenerative disease.

We’ll update this story as appropriate. Here’s our recent feature that chronicles Icahn’s battle for more control of Genzyme and the company’s manufacturing woes.

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With his leadership under attack and FDA regulators cracking down on his company’s manufacturing, Genzyme chairman and CEO Henri Termeer is traveling to meet with the firm’s top 30 shareholders over the next month.

The road trip, discussed yesterday in an interview with Genzyme spokesman Bo Piela, comes just over a month before the company’s annual meeting on June 16. At the meeting, the billionaire investor Carl Icahn aims to unseat Termeer and three others on the firm’s board of directors. And Icahn, who has a 4.9 percent stake in the firm and a record of ousting executives from troubled companies, holds plenty of ammo for his campaign to gain greater control of Genzyme.

A litany of mishaps has riddled Cambridge, MA-based Genzyme (NASDAQ:GENZ), the world’s largest maker of rare disease drugs, during the past year. Viral contamination caused a temporary shutdown at its Allston, MA, drug plant. Shortages of key products have slowed sales. The FDA has slapped fines on the firm for manufacturing violations. And some unhappy investors, Icahn the most vocal among them, want changes—including an end to Termeer’s nearly three-decade reign at the company.

Henri Termeer, CEO of Genzyme

David Meeker, Genzyme’s chief operating officer, candidly summarized the situation at his company when, during his speech at an industry meeting in Cambridge last month, he said: “We’re obviously in a tough spot.”

Many of Genzyme’s problems stem from its manufacturing problems. In June, the company revealed that it was temporarily closing the Allston Landing plant because a virus was found in a bioreactor needed to produce the firm’s top-selling product, imiglucerase (Cerezyme), which is used to treat a rare genetic illness called Gaucher’s disease. Sales of the drug fell from $1.23 billion in 2008 to … Next Page »

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The big news in the San Diego biotech community this week came from the boardroom instead of the laboratory. Dissident shareholder factions elected representatives to the boards of both San Diego-based Amylin Pharmaceuticals (NASDAQ: AMLN)and Biogen Idec, the Cambridge, MA, biotech that has a significant local presence.

—Amylin’s founding CEO Howard “Ted” Greene, who also is the company’s biggest individual shareholder, may have played a key role in influencing the recent board election. Greene told me he’s optimistic about the outcome, in which a dissident faction of Amylin shareholders gained two board seats and ousted the chairman and lead outside director.

—Meanwhile, in Cambridge, MA, representatives of billionaire investor Carl Icahn claimed victory yesterday in their proxy contest with Biogen Idec (NASDAQ: BIIB) by winning two of four board seats in a recent shareholder election. The company adjourned the annual shareholder meeting without announcing the official results, however.

[Editors note: A previous version of the Targeted Genetics item incorrectly reported that Robin Ali presented results of his research in San Diego.  He did not attend the meeting]

—The potential loss of Seattle’s Targeted Genetics (NASDAQ: TGEN), which is struggling to avoid bankruptcy, will make it harder to bring new gene therapy treatments to market, according to Robin Ali, a University College London researcher.  At the American Society of Gene Therapy meeting in San Diego last week, a colleague of Ali’s presented clinical trial results from Ali’s experimental gene therapy treatment for a rare, genetic form of blindness that was supported by Targeted Genetics. “If they were to close,” Ali told Xconomy’s Denise Gellene by email, “it would leave a gap in the market that would take time to fill.”

—Celladon CEO Krisztina M. Zsebo told Denise at the American Society of Gene Therapy annual meeting that the San Diego gene therapy startup is in discussions with several pharmaceutical companies and expects to announce a … Next Page »

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Amylin Pharmaceuticals (NASDAQ: AMLN) co-founder and original CEO Howard Greene is urging shareholders to vote for Carl Icahn’s or Eastbourne Capital Management’s proposed slate of directors, the Associated Press is reporting today. Greene’s support for dissident nominees adds new twist to a hot proxy fight at the diabetes drug maker.

In a letter to shareholders of the San Diego company, Greene says owners of the company’s stock have suffered with disappointing sales of its products, and argues that the directors responsible for the company’s marketing should be replaced. He adds that big stockholders should be better represented in Amylin board. Greene himself resigned from the board in April.

Amylin is scheduled to hold its annual meeting on May 27. The company says its sales strategy is working. It charges that Icahn and Eastbourne want to sell the company, and that any sale in the near term would undervalue the company. Amylin recently announced layoffs among its sales force, and last Tuesday it introduced a new diabetes drug, a once-a-week medicine called Byetta.

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