ExtremitiesRecon

Smith & Nephew’s Bohuon seen as strong candidate for top Sanofi job

* Frenchman Bohuon is Smith & Nephew’s CEO since 2011

* Track record seen strong at U.S. and French firms

* French nationals seen well-placed to handle unions, politics

By Natalie Huet and Sophie Sassard

PARIS/LONDON, Nov 4 (Reuters) – The French boss of British artificial knee and hip maker Smith & Nephew, Olivier Bohuon, is seen as a strong candidate to head Paris-based drugmaker Sanofi, which sacked its CEO last week, industry observers say.

Bohuon, 55, who previously ran the pharmaceuticals business at U.S. drugmaker Abbott and GlaxoSmithKline’s operations in Europe, has steered the British company into faster-growing areas, such as sports medicine and emerging markets since he took over in 2011.

His experience running pharmaceuticals companies in France as well makes him suited to run a global drugmaker in a country with strong labour laws and a history of politicians demanding a say in its companies’ decisions, according to analysts and bankers who have worked with Sanofi.

“There’s a strong rationale for Sanofi to appoint him. He’s halfway through the job at Smith & Nephew and whether he wants to abandon that is a question, but Sanofi, for a Frenchman, would have very strong attractions,” said Savvas Neophytou, an analyst at Panmure Gordon.

The board of France’s second-biggest listed company fired Viehbacher, its CEO of six years, last Wednesday, blaming his brusque management style, miscommunication with board members and poor execution of the group’s strategy.

The French drugmaker had no successor lined up and has hired executive search firm Egon Zehnder to find one, Le Figaro newspaper reported. Egon Zehnder declined to comment.

Bohuon himself declined to comment when asked if he was a contender, after he presented solid results for Smith & Nephew on Thursday. Sanofi also refused to comment.

Sanofi’s Chairman Serge Weinberg, who is now the interim CEO, has said the board is looking for candidates mainly outside the company and for someone with solid experience in the pharmaceutical industry, regardless of nationality.

But investors believe the predominantly French board may prefer a French candidate in order to avoid the cultural clashes that led to the downfall of the German-Canadian Viehbacher.

AstraZeneca’s French CEO Pascal Soriot has also been suggested as a possible successor. But he is seen by analysts as unwilling to abandon AstraZeneca so soon after seeing off a bid from Pfizer in May and while the company is winning plaudits for its pipeline of cancer drugs. Soriot also has roots as much in Australia, where he has family, as in France.

Moreover, the Sanofi job would not necessarily mark a step up for Soriot. But for Bohuon, moving to a company worth $120 billion from one worth $15 billion would be a coup.

Another possible candidate is Bernard Poussot, the former boss of Wyeth who was also educated in Paris. Leerink analyst Seamus Fernandez said in note last week he would be “a strong choice.” But Poussot would have to be persuaded out of retirement, and at 62 he might be deemed too old.

LOOKING INWARDS

Bohuon, who studied at the prestigious HEC business school in Paris, and who was CEO of French pharmaceutical and cosmetics firm Pierre Fabre four years ago, has direct experience of how French politics and business intersect.

Many of the CAC-40 index of French blue chip companies owe their might, at least in part, to state intervention of one sort or another. In this area, Viehbacher had often come across as undiplomatic, as he cut jobs in French labs he said were not productive enough and tipped the drugmaker’s centre of gravity towards the United States, the world’s largest drug market.

Viehbacher’s recent relocation to Boston, and the fact he had considered selling an $8 billion portfolio of mature European drugs largely produced in France without sharing the idea with the board, rankled with directors from the French establishment.

Bohuon could represent a diplomatic balance, with his international resume offering reassurance to investors concerned that Sanofi could shift its focus back to France and become more insular.

“I think he’s done a fantastic job turning Smith & Nephew around and he’s been very well-liked and received by the investment community,” said one analyst who heard Bohuon’s name floated by several portfolio managers but declined to be identified because of the topic’s sensitivity.

Bohuon’s experience in medical equipment could also dovetail with Sanofi’s diabetes business, which accounts for close to a fifth of its revenue. Sanofi is looking to develop more convenient insulin delivery devices and systems to help patients better monitor blood sugar levels.

Any appointment is unlikely before early 2015, analysts say. Sanofi’s chairman has said the board will take the time needed to find “the best possible boss”. (Additional reporting byBen Hirschler in London, editing by Louise Heavens)

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Josh Sandberg

Josh Sandberg is the President of Ortho Sales Partners and Partner for The De Angelis Group. He also serves as Co-Founder and Editor of OrthoSpineNews.

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