This Is One Incredible CEO
The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out CEO gaffes and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here is last week's selection.
This week, I plan to stick with the biotechnology sector and highlight the best-performing company since the recession, Pharmacyclics , and its CEO, Robert Duggan.
Kudos to you, Mr. Duggan
Just because I've been proven wrong time and again by Pharmacyclics doesn't mean I can't appreciate the phenomenal job its CEO has done with taking the stock from just $0.57 on Feb. 20, 2009 to a close of $88.66 as of yesterday - just your typical 15,454% gain in four years.
Pharmacyclics' ascent has been derived from both the exceptional promise of its pipeline, as well as a gigantic partnership struck with pharmaceutical giant Johnson & Johnson .
Pharmacyclics' saving grace is Ibrutinib, a BTK-inhibitor currently in mid-stage trials for chronic lymphocytic leukemia, or CLL and mantle cell lymphoma, or MCL. In CLL trials, Ibrutinib absolutely wowed researchers by demonstrating a complete or partial response in 71% of treatment naïve patients. In a two-year follow-up, an even more impressive 96% of treatment naïve patients had shown no disease progression, along with 76% of high-risk and relapsed patients registering no disease progression. These results led some analysts to estimate that sales of the drug, assuming approval, could peak at a whopping $5 billion, annually. Even more, a path to approval of Ibrutinib got even easier with the Food and Drug Administration placing the first-ever "breakthrough therapy" designation on the drug.
In a separate trial, Ibrutinib was combined with Roche's Rituxan and proved effective in 33 of 40 patients. 95% of all patients in this trial had no disease progression noted after follow-ups at three and six months. In addition to CLL and MCL, Ibrutinib may eventually find success in various autoimmune disorders such as rheumatoid arthritis.
Having seen the promising results of Ibrutinib, J&J orchestrated a deal worth up to $975 million with Pharmacyclics in return for half of its global sales in December 2011. The deal, which has already divvied out $300 million to Pharmacyclics, has given the company ample working cash to run additional trials and gives it plenty of financial backing from one of the industry's most respected names.
In addition to Ibrutinib, Pharmacyclics has two other compounds in development, PCI-2478, which is currently in mid-stage trials for pancreatic cancer, and Abexinostat Hcl for follicular lymphoma and MCL. In early stage results, PCI-24783 in combination with Eli Lilly's Gemzar, was well tolerated. As a FactorVIIa inhibitor, PCI-24783 has the potential to challenge some of the most prominent existing pancreatic cancer treatments from a completely different angle.
A step above his peers
We actually could stop right here and that would be more than enough to qualify Robert Duggan as an incredible CEO. Honestly, how many CEOs do you know that can claim a return of 15,454% since the recession? Still, we'll press on because there are other intangible factors, such as employee benefits and philanthropy, which make Duggan a great leader.
Duggan understands, like many top CEOs do, that a happy workforce is a healthy and productive one. As such, Pharmacyclics offers its employees some truly exceptional perks on top of the typical medical and dental benefits plans you find almost everywhere. To begin with, considering the gigantic run in its stock price, employees are able to purchase shares of stock through an Employee Share Purchase Plan at a discount of at least 15% from current market prices. If reinvesting in your company isn't your thing, then perhaps you'll appreciate the three weeks of vacation that all employees are offered, the free local gym memberships, and the commuter benefits which include free shuttle service via train from the Caltrain station located in Sunnyvale, Calif., to Pharmacyclics' corporate office.
Putting your religious preferences aside, Duggan's $20 million in donations to the Church of Scientology are the highest to date of anyone, anywhere. Whether your beliefs align with the Church of Scientology, I see value in these donations as it demonstrates that Duggan will put his money behind that which he has faith in. Considering that he owns more than $1.07 billion worth of Pharmacyclics' stock and hasn't sold a share on the open market, that's a resounding endorsement for Ibrutinib and the company's future.
Two thumbs up
Really, what else can you say about a CEO who has completely revitalized a struggling company with a nearly $1 billion pharmaceutical deal for Ibrutinib and a healthy pipeline of cancer and autoimmune hopefuls? I'm pretty sure Pharmacyclics' monstrous return does all the talking necessary and, given that and the above intangible factors, Mr. Duggan gets a well-deserved two thumbs up from me!
Do you have a CEO you'd like to nominate for this prestigious weekly honor? If so, head on over to the new CEO of the Week board and chime in with your fellow Fools on who deserves some praise. If you don't have a nominee yet, don't worry; you can still weigh in on other members' selections.
Is bigger really better?
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The article This Is One Incredible CEO originally appeared on Fool.com.Fool contributor Sean Williams has no material interest in any companies mentioned in this article. He loves giving credit when credit is due. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.The Motley Fool owns shares of Johnson & Johnson. Motley Fool newsletter services have recommended buying shares of Johnson & Johnson. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that strongly believes in doing right by investors.