Legal Eagles at Bristol

Bristol-Myers Squibb (BMY) said it hired former U.S. attorney Mary Jo White and former FBI director Louis Freeh to investigate its handling of a key patent settlement.

The news came as The Wall Street Journal reported that the board, under fire over Bristol's latest legal black eye, is open to replacing CEO Peter Dolan.

A statement Thursday by Bristol's board said it has been treating a Justice Department investigation of a settlement covering Bristol's bestselling Plavix drug "with the highest degree of attention and seriousness." The board said its outside counsel hasn't found evidence of unlawful conduct by its workers.

The government opened a criminal probe last month of Bristol's deal with Canadian drugmaker Apotex, and FBI agents raided Dolan's office. Shares of the New York drugmaker have since plunged 20%.

Bristol and partner Sanofi (SNY) sought earlier this year to pay Apotex to keep its generic Plavix off the market for five more years. But that pact was rejected as anticompetitive by state attorneys general, who had power to reject the pact because of Bristol's prior patent missteps. The company had agreed several years ago to a settlement covering its handling of generic Taxol and Buspar.

Apotex last week started selling generic Plavix, hammering Bristol shares as investors fretted over lost sales. Bristol and Sanofi have since sought an injunction to stop sales of the Apotex product, which they believe infringes their patents. Hearings are to begin Friday.

Bristol said it hired White, of Debevoise & Plimpton, to conduct an independent investigation, and its independent directors hired Kenneth Conboy, of Latham & Watkins. The board named former chief Jim Robinson and Freeh to monitor legal dealings.

The board also seemingly stood behind Dolan. "The board's paramount focus remains on the best interests of the company and its shareholders," the statement said. "The board is well aware of investor concerns. The board believes the company is executing the appropriate initiatives to protect the best interests of the company and its shareholders."

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