Elan's Martin Named Worst Biotech CEO of '08

And the strategy worked for a time. Through the early spring and into summer, Elan's share price doubled from $18 to $36 as anticipation grew for the release of the bapineuzumab phase II data at an Alzheimer's disease research meeting in late July.

Those bapineuzumab data were horrible and put a serious crimp in the drug's future, even as Elan and partner Wyeth (WYE Quote) were sinking big bucks into phase III clinical trials.

What was most shocking about bapineuzumab's setback and the resulting crash in Elan's stock price was that Martin and his team obviously knew what the phase II data looked like before investors and the public, yet Martin was wholly unprepared to deal with the questions and criticisms that arose.

Martin was apparently so busy telling his investor friends not to worry and to buy more Elan stock that he couldn't even fathom a scenario in which investors would view bapineuzumab as a failure.

Instead of taking responsibility for the bapineuzumab fiasco, Martin, to this day, blames it all on unrealistic investor expectations (even though he set them) and data too complex for ordinary people to really understand.

In the end, though, Martin was the only person who didn't get it. He managed to anger his friends and shareholders more than his critics, which ruined his credibility. Elan shareholders lost millions of dollars.

After that, Martin had a hard time getting anyone to listen, which is why he was so ineffective in August, when new cases of a serious brain infection cropped up in patients taking the company's multiple sclerosis drug Tysabri.