March 27 (Reuters) - Impax Laboratories Inc, which is said to be conducting a strategic review, named former Allergan Plc executive and industry veteran Paul Bisaro as its chief executive, sending the drugmaker’s shares soaring as much as 38 percent.
The past year has seen mounting pressure on generic drugmakers, as speedier approvals of generic products by U.S. regulators ratchet up competition in the sector, squeezing smaller players such as Impax, that lack bargaining power.
Impax has asked investment bank Morgan Stanley to help it conduct a strategic review, people familiar with the matter told Reuters earlier this month.
Bisaro, 56, was largely behind transforming a much smaller generic drugmaker Watson Pharmaceuticals, at a couple of billion dollars in market cap, into the current version of Allergan with a market valuation of about $80 billion.
Given some of Impax’s near-term challenges and Bisaro’s still relatively young age, Leerink analysts believe he is committing to a process that may not be short-term.
However, the hire and the Reuters report suggest Impax will be an active acquirer or future M&A target, Leerink said.
Bisaro, whose appointment is effective immediately, succeeds Kevin Buchi, who has served as interim president and chief executive since December.
“Bisaro is one of a handful of experienced generic industry executives we have gotten to know over the past 18 years that has demonstrated a solid track record of execution,” BTIG analysts said, raising their price target to $16 from $13.
Impax’s shares were up 38.65 percent at $12.83, set for their best day in more than 8 years. (Reporting by Ankur Banerjee in Bengaluru; Editing by Shounak Dasgupta)