Alexion Drug Sale Practices Target of Internal Investigation

Alexion Pharmaceuticals (ALXN) disclosed Wednesday its board of directors is investigating allegations of improper sales practices tied to its top-selling drug Soliris.

The allegations were made by a former Alexion employee, the company said.

Alexion has delayed the filing of its third quarter report with the Securities and Exchange Commission while the investigation is underway.

Here is the company's full statement:

The Audit and Finance Committee of the Board of Directors of Alexion Pharmaceuticals, Inc. ("Company") is conducting an investigation into allegations that recently have been made by a former employee with respect to the Company's Soliris sales practices. Specifically, the Audit and Finance Committee is investigating whether Company personnel have engaged in sales practices that were inconsistent with Company policies and procedures and the related disclosure and other considerations raised by such practices. The Audit and Finance Committee has retained outside counsel to assist it in the investigation. At this point in time, the Audit and Finance Committee's investigation has not identified instances where Soliris orders were not placed by customers for patients or any facts that require the Company to update its previously reported historical results. The Audit and Finance Committee and its counsel are working diligently to complete the investigation, but at this time it is uncertain when this investigation will be complete and what the results of such investigation will be.

Alexion shares closed Wednesday up 6.5% to $127.16. The stock fell 6% to $119.35 following the announcement of the Soliris sales investigation.

Speculation has clung to Alexion since Friday when the company cancelled a presentation at a healthcare investor conference. Rumors that Alexion was an imminent acquisition target turned quickly to concern about the company's delayed 10-Q filing.

Soliris sales have totaled $2.2 billion through the first nine months of the year.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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