Shares of clinical-stage biotech company Axovant Sciences Ltd. (AXON) plunged on Monday, Feb. 12, after it announced that its CEO, as well as its president and COO, had both resigned.
According to a press release, former CEO David Hung, who had been in the job for just 10 months, was leaving to pursue other opportunities, as was president and COO Marion McCourt.
The Basel, Switzerland, company has tapped Pavan Cheruvu as its new CEO. Cheruvu joined Axovant's parent company, Roivant Sciences Ltd., in 2015 and was appointed to its executive leadership team in 2017. Cheruvu, a board-certified physician, was a management consultant at McKinsey & Co. focusing on biopharmaceutical strategy before his medical training.
Shares of Axovant were down 20.7% to $1.51 in morning trading. The stock is down more than 71% in 2018.
The latest news came after Axovant on Jan. 8 unveiled negative results in the Phase 2b study of intepirdine in patients with dementia with Lewy bodies (DLB) and Phase 2 studies of intepirdine and its effect on gait and balance in patients with Alzheimer's disease, DLB or Parkinson's disease dementia (PDD).
In the same announcement on Jan. 8, the company said a Phase 2 study of nelotanserin had achieved its primary goal of safety in patients with DLB and PDD that were experiencing visual hallucinations. In addition, the company reported positive trends in efficacy in the study. A day later, Axovant said it had incorrectly reported data involving a subset of patients. The company also said it will continue to discuss a larger confirmatory study of nelotanserin with the U.S. Food and Drug Administration focusing on patients with DLB.
Hung, the founder and former CEO of oncology drugmaker Medivation Inc., took the helm of Axovant in April 2017 after overseeing the $14 billion sale of Medivation to Pfizer Inc. (PFE) in a deal completed in September 2016.
"Roivant remains firmly committed to Axovant's long-term success," Roivant CEO and Axovant chairman Vivek Ramaswamy said in a statement Monday. "Axovant will need to operate as a lean, entrepreneurial organization in the near term. In that context, Pavan is the right leader for the company at this time."
Also on Monday, Axovant said that directors Kate Falberg, Tony Vernon and Patrick Machado have resigned and that Roger Jeffs and George Bickerstaff have joined the board. Jeffs is a former co-CEO of United Therapeutics Corp. (UTHR) and is an early-stage investor in the biopharmaceutical sector. Bickerstaff, a former executive at Novartis AG (NVS) , is a co-founder, partner and managing director of healthcare and technology investment bank M.M. Dillon & Co.