New President to Take Helm at Medstone

Medstone International Inc. on Thursday named Richard Ferrari as president and chief operating officer of the Irvine-based biotechnology company.

Ferrari, a former executive vice president of ADAC Laboratories in Milpitas, Calif., replaces acting president Jack Olshansky, who has filled the job on an interim basis since November.

Medstone is a manufacturer of lithotripters, which are sophisticated shock-wave devices designed to disintegrate kidney stones without surgery.

Ferrari’s appointment is the latest in a series of top management changes at the Irvine company. Olshansky, a representative of Medstone’s largest shareholder, Montgomery Medical Ventures, was appointed to the president’s post following the resignation last August of company co-founder Richard L. Penfil.

Penfil and Medstone’s vice president for regulatory affairs, P. Joshua Burke, left the company amid continuing problems in gaining Food and Drug Administration approval to use Medstone’s lithotripters as a non-surgical alternative for treating gallstones. The FDA has approved the machines only for treating kidney stones.

On Wednesday, Medstone announced a net loss of $602,471 on revenue of $4.2 million for the first quarter ending March 31, compared to earnings of $358,534 on revenue of $4.1 million in the year-earlier quarter.

Medstone Chairman Freeman Rose blamed the lower earnings on efforts to reduce corporate expenses and on legal costs associated with a pending class-action shareholder lawsuit against Medstone. The suit alleges that Medstone withheld adverse information about its prospects in order to inflate its stock price.