What to Expect From Fred Hassan at Bausch & Lomb
Bausch & Lomb employees, digesting the news that their new chairman will be Fred Hassan, are probably thinking that he'll dress the company up for a sale, just as he did with Pharmacia (bought by Pfizer (PFE)) and Schering-Plough (bought by Merck (MRK)).
That's true -- "Bausch needs its manufacturing cleaned up and its brand marketing improved," according to Forbes -- but here are a few other things that people might want to watch for under Hassan.
First, it will be a surprise if Hassan's compensation is not massive. Hassan's excellent at cutting deals in which he makes out like a bandit. As Bausch is privately owned we might not get the details, but you can safely assume that Hassan isn't doing this pro bono.
And while Hassan's strength may be making the big strategic decisions that turn companies around so they become attractive to acquirers who want to run them in the long run, his weakness is the details: At Pharmacia, he once wrote "Pl. follow up." in the margin of a piece of junk mail that landed in his inbox -- and because his lieutenants followed that instruction to the letter the company ended up paying a quack doctor $50,000 to sell human growth hormone for "anti-aging" purposes. Which is a federal crime. Pfizer ended up paying $35 million to make that go away.
At Schering, the company spent eight years -- the final three under Hassan -- marketing cancer drugs for unapproved "off-label" uses. Schering paid $180 million for that.
And, also at Schering, there was what might politely be called "confusion" as to who knew what and when about a supposedly blinded trial of the cholesterol drug Vytorin that wasn't all that blind.
But don't worry -- This won't last long. Hassan is about 64, so the siren song of the golf course will be getting louder with every passing month. Besides, he likes to spend six years or less at the top before moving on, as his last three jobs show (Wyeth board of directors 1995-1997, Pharmacia 1997-2003, Schering 2003-2009).
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