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Barer's Pairing with Blech Should Provide Remarkable Positioning and Growth for Medgenics
When two biotech superstars get together, remarkable things can happen. Such is the case with the most recent developments at Medgenics, Inc. (NASDAQ:MDGN).
On July 2, Medgenics announced the addition of Sol Barer, former Chairman and CEO of Celgene Corp. (NASDAQ:CELG), to head its own board of directors. A fantastic coup, given Dr. Barer's long history of industry successes and accolades, particularly the transformation of Celgene from a chiral compound research shop into a multi-billion dollar international pharmaceutical force.
Dr. Barer was the driver behind convincing scientists at Celgene to put faith in thalidomide, banned long ago for causing severe birth defects, in a bet that certain aspects of the drug could be used to fight disease.
The insight paid off - using Celgene's expertise in chiral chemistry a newer, more potent version of the drug came to market and quickly became a blockbuster therapeutic for many types of cancer.
After 25 years of growing a young pharmaceutical outfit without the help of outside partners, Dr. Barer retired from Celgene. What next?
It is not Dr. Barer's nature to play golf or build birdhouses; science and the business of leading companies is in his blood. This year, Dr. Barer joined two other boards as Chairman - Cerecor, Inc. and ContraFect Corp.
These companies, Cerecor and ContraFect, and now Medgenics, share a common denominator - all three incorporate Dr. Barer as Chairman and Isaac Blech, considered one of the most successful financiers in biotechnology and founder of Celgene, as a board member. In fact, all three have seen their board chairs replaced by Dr. Barer in a span of 18 months, most likely at Mr. Blech's behest. Results have been favorable.
Three months after Dr. Barer was appointed head of ContraFect's board, the former Chairman of GlaxoSmith Kline plc (NYSE:GSK) was snagged as a Director, an event that ContraFect would not have been able to pull off by itself. At Cerecor, company events also took a turn for the better - as Chairman, Dr. Barer helped develop a scientific advisory board, raised $22 million, and guided the company into the initiation of a Phase II trial for its leading therapeutic candidate.
We expect similar good things to happen at Medgenics with Dr. Barer and the helm, and Mr. Blech at his side.
In May, Medgenics was given the FDA nod to begin a Phase IIb clinical trial for its EPODURE Biopump that treats anemia in dialysis patients, the company's first such approval in the U.S. Last month, an Orphan Drug designation was granted for INFRADURE, a biopump designed to treat a form of hepatitis. If Medgenics can realize these achievements in a short time, imagine how far and how fast it can move with the Barer/Blech team in place.
This is not a case of cronyism for the sake of cronyism. This team has a history of infusing fledgling life science companies with both monetary and intellectual capital. Medgenics is at a stage of growth where Dr. Barer's scientific and business acumen, regulatory knowledge, and industry influence can only increase investor value. In addition, upcoming short term catalysts in the stock may also set the stage for additional developments and share price appreciation for investors.
About The Analyst: Sharon Di Stefano
Sharon di Stefano was one of the first analysts on Wall Street to cover the career of Sol Barer as Chairman and CEO of Celgene Corp. She has spent 20 years as a healthcare analyst, beginning her career at Smith Barney, Harris Upham & Co. specializing in medical devices, pharmaceuticals, healthcare information technology, and biopharmacology. Ms. di Stefano had also served as Senior Venture Officer for the Edison Innovation Fund, implemented through the New Jersey Economic Development Authority that provided funding for early-stage life sciences companies.
Ms. di Stefano received a Masters of Science degree, in Business, from Johns Hopkins University in 1986, and a Bachelor of Arts from the University of Delaware in 1984 with a minor in biology.
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