- After about six years in the position
- Accolades, praise and thanks for Scangos
- Marianne De Backer taking over
- Scangos spoke at length and said 161 words
(exechange) — San Francisco, California, January 25, 2023 — George Scangos, chief executive of Vir, leaves his position. As announced by Vir Biotechnology Inc. in a news release and in a regulatory filing published on Wednesday, January 25, 2023, George Scangos leaves his post as chief executive officer at the commercial-stage immunology company, after about six years in the role, effective April 3, 2023.
The average tenure of CEOs who announced their departure over the past 12 months was 8.4 years. This is according to data collected by CEO-exit research firm exechange.
exechange tracks CEO departures at the 3,000 largest publicly traded companies in the U.S., examines the reasons CEOs leave and determines the Push‑out Score™, a measure of pressure on departing chief executives on a scale of 0 to 10.
George Scangos’s duties as CEO will be taken over by Marianne De Backer, most recently Executive Vice President, Head of Pharmaceuticals Strategy, Business Development and Licensing/Open Innovation, and Member of the Executive Committee at Bayer Pharmaceuticals.
The fact that George Scangos’s successor is brought in from outside suggests that the board may seek to stimulate change with fresh ideas and new initiatives.
“Now is the right time”
George Scangos’s departure from the CEO post is explained as follows. Scangos stated: “I feel confident that now is the right time for me to retire and that Dr. De Backer is the right successor to ensure Vir’s ongoing forward momentum.”
The top three reasons cited in corporate announcements for CEO departures over the past 12 months are performance issues (26.8% of cases), implementation of a planned succession (16.5%) and the statement that the time was right for a change (8.8%), according to exechange data. Other motives given for leadership changes included the outgoing CEO’s wish to pursue other opportunities (5.9% of cases), personal reasons (2.9%) and conduct issues (2.1%). Rather rarely stated reasons are career change (2.1% of cases), health problems (1.8%), death (0.9%), the desire for more time with family (0.6%) and disagreement (0.6%). Sometimes, more than one reason was given. In 31.2% of cases, no reason was given.
Precise information regarding George Scangos’s future plans was not immediately available.
Vir said: “George Scangos, Ph.D., will retire from his position as Chief Executive Officer (CEO), effective April 3, 2023.”
Vir further said: “On January 19, 2023, George Scangos, Ph.D., notified the Board of Directors (the “Board”) of Vir Biotechnology, Inc. (the “Company”) of his decision to retire as Chief Executive Officer and President effective as of the Effective Date [April 3, 2023].”
Generally, retirements are seen as formally voluntary departures. Still, CEOs may also be pressured to accelerate their retirement plans. In fact, 35% of the time “retire” was used in CEO departure announcements over the past 12 months, the departing chief executive received a Push-out Score above the critical threshold of 5, indicating elevated pressure.
Share price increase since January 2020
The announcement follows an increase in Vir Biotechnology Inc.’s share price of 150% since January 2020.
In the position of CEO since 2017
George Scangos became CEO of the Company in 2017.
Upon his retirement as CEO, Scangos will serve in an advisory role to De Backer through June 2, 2023 and will continue providing strategic counsel to Vir as a member of the Board of Directors.
George Scangos, Ph.D., has served as the Company’s President and Chief Executive Officer and as a member of the Board of Directors since January 2017.
From July 2010 to December 2016, Scangos served as Chief Executive Officer and as a member of the board of directors of Biogen Inc., a U.S. publicly traded biopharmaceutical company (“Biogen”).
From October 1996 to July 2010, Scangos served as President and Chief Executive Officer of Exelixis, Inc., a drug discovery and development company (“Exelixis”).
From 1993 to 1996, Scangos served as President of Bayer Biotechnology, a biotechnology company, where he was responsible for research, business development, process development, manufacturing, engineering and quality assurance of Bayer Biotechnology’s biological products.
Before joining Bayer Biotechnology in 1987, Scangos was a Professor of Biology at Johns Hopkins University. Scangos currently serves on the board of directors of Agilent Technologies, Inc., a U.S. publicly traded life sciences, diagnostics and applied chemical analysis company, and previously served on the board of directors of Exelixis from 1996 to 2020.
Scangos served as Chair of PhRMA in 2016, and as the Chair of the California Healthcare Institute in 2010.
He was a member of the board of directors of the Global Alliance for TB Drug Development from 2006 until 2010.
Scangos currently serves on the Board of Trustees of Cornell University and the Board of Overseers of the University of California, San Francisco (“UCSF”).
Scangos received his B.A. in Biology from Cornell University and a Ph.D. in Microbiology from the University of Massachusetts.
161 words by George Scangos
In the news release announcing his departure as CEO of Vir Biotechnology Inc., George Scangos received accolades, praise and thanks.
In announcing the leadership change, George Scangos spoke at length and said 161 words.
“Incredible skill set”
George Scangos stated: “Having the opportunity to bring life-saving medications to patients around the world has been the greatest privilege of my career. I am extremely proud of our employees’ unwavering commitment to the patients we serve and all that we have accomplished as a result. I feel confident that now is the right time for me to retire and that Dr. De Backer is the right successor to ensure Vir’s ongoing forward momentum. The Company is operating from a position of strength with significant cash, an impressive pipeline and critical near-term catalysts that have the potential to support multiple important therapies. Additionally, we have laid out a vision for the Company that gives me great confidence in Vir’s ability to transform the infectious disease landscape. Given the strength of our people, our values, our science and the incredible skill set that Dr. De Backer brings to Vir, I believe the Company is well-positioned to continue to grow and thrive in the years ahead.”
Over the past 12 months, 25% of all outgoing CEOs remained silent in the departure announcement, according to data compiled by exechange. Departing CEOs who did make a statement said an average of 109 words. The longest statement was 510 words. The shortest statement was 23 words. Leadership transitions in which departing CEOs provide conspicuously short, excessively long or no explanations for their move are statistically associated with elevated pressure and show an increased incidence of Push-out Scores above the critical threshold of 5.
34% of CEOs are forced out or fired
When CEO departures are announced, exechange determines the Push-out Score on a scale of 0 to 10 to assess how likely it is that the chief executive was pushed out or felt pressure to leave the position, with 0 being most likely a voluntary move and 10 being most likely a forced exit. Anything over a 5 indicates that there are valid reasons to believe an executive may have been pushed out.
Of the 340 CEO departures in the Russell 3000 Index evaluated over the past 12 months (January 25, 2022, to January 24, 2023), the average Push-out Score was 5.7, according to exechange data. References to conduct issues, disagreements and irregularities lead to the highest Push-out Scores. When time with family, performance issues or other opportunities were cited as departure reasons, the average Push-out Scores were also significantly elevated.
Around 34% of the CEO departure events from the past 12 months received Push-out Scores of 8 or higher.
In other words, in the past 12 months, one in three departing CEOs were forced out or fired.
Pressure in the health care sector far above the critical threshold
Some industries are under generally higher pressure than others, and CEOs are feeling the strain. In the past 12 months, the communication, consumer staples and health care sectors showed the highest average Push-out Scores. By contrast, pressure on CEOs was lowest in the real estate, financials and utilities sectors, as measured by average Push-out Scores.
In the health care sector, which includes Vir Biotechnology Inc., the average Push-out Score over the past 12 months was 7, which is far above the critical threshold of 5.
In the health care sector, 28 exiting CEOs received Push-out Scores of 8 or higher over the past 12 months, indicating that they were most likely forced out or faced strong pressure to step down.
Push-out Score for George Scangos’s move determined
The Push-out Score regarding George Scangos’s move is explained point by point in the exechange report.
exechange reached out to Vir and offered the company the opportunity to comment on the score.
Read the full story in the exechange report 5.2023 ($).