Depomed Inc. ($DEPO) is on its way to resolve its longstanding issues. The company recently announced that it has reached an agreement with its activist investor Starboard Value. The agreement results in Depomed appointing a new CEO. The company will also add two more seats to its Board of Directors.
Depomed has named Arthur Higgins as its new CEO. He will replace James Schoeneck who has tendered his resignation. Higgins has earlier worked with Bayer Healthcare. He will also take a seat on the board of Directors. The other two new directors are Gavin Molinelli, partner of Starboard and William McKee, a former chief financial officer of Barr Pharmaceuticals LLC.
Depomed stock lost over 28 percent of its value so far this year. The latest agreement is likely to provide some support to its falling stock price. It is expected that the stock may regain some of its lost ground in near future. However, the company recently reported that it expects its first quarter revenue to be in the range of $95 million and $100 million, lagging behind the street expectations.
The investors are also likely to remain cautious as the regulatory environment for opioid drugmakers is expected to remain stringent.