Why Optimer Shares Plunged Again
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of drugmaker Optimer Pharmaceuticals (NAS: OPTR) plummeted for the second straight day after the board of directors fired three of its key executives.
So what: Chairman Michael Chang, CFO John Prunty, and vice president Youe-Kong Shue were all let go on Monday over a lapse in governance, triggering fears over bad publicity and higher scrutiny going forward. The move was sparked by the grant of 1.5 million shares of its subsidiary Optimer Biotechnology to Chang, suggesting the possibility that it isn't the only cockroach in the kitchen.
Now what: While Chang will remain a director of Optimer for now, the board has asked for his resignation. Former Pfizer CEO Hank McKinnell will replace Chang as chairman, while chief compliance officer and senior vice president Kurt Hartman will act as the temporary CFO. Although Optimer's board certainly did the right thing by making quick and drastic changes, the negative sentiment surrounding the stock might be too much for average investors to handle.
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