Zeneca Group Ousts Founder of Salick Health

Only hours after completing its takeover of the nation’s largest chain of for-profit cancer clinics, British drug and chemical giant Zeneca Group ousted the company’s colorful founder, Dr. Bernard Salick, it was announced Monday.

Zeneca named Michael J. O’Brien, a veteran company executive from Britain, to replace Salick as chief executive of Salick Health Care, a Los Angeles-based operator of hospital-based cancer centers and kidney dialysis clinics.

Bernard Salick’s departure took place Thursday, the same day that Zeneca completed its purchase of the 50% of Salick that it didn’t already own.

On Monday, Bernard Salick announced that he will start a new “global health-care company” to compete with his namesake firm in the areas of cancer, kidney disease, AIDS and organ transplants.

The two sides agreed there is no clause in Salick’s contract prohibiting him from starting a competing company. But a knowledgeable industry source said it will not be easy for Salick to repeat his success in the cancer field.

“This market is already very full with oncology management practice firms with more experience,” the source said. “It is very late for a new entrant at this point.”

A Zeneca executive said Salick wasn’t fired--at least not technically. Instead, the company founder resigned rather than accept Zeneca’s offer to become chairman emeritus and a “strategic advisor.”

That offer was made personally by Zeneca Group Chief Executive David Barnes, who flew in from London and summoned Salick to a meeting at a Beverly Hills hotel on Thursday afternoon, executives said.

But Marshall Grossman, a lawyer for Bernard Salick, said that even though Zeneca’s proposal included $800,000 in annual pay, Salick viewed it as insincere.

“This was part of a carefully orchestrated plan to sever Zeneca’s relationship with Dr. Salick,” Grossman said.

He claimed that Barnes “read from a prepared script” as he broke the news to Salick. The offer, he said, “was probably put on the table with the expectation that Bernie wouldn’t accept it.”

Moreover, Grossman said, the British firm had “a team of lawyers, security personnel and others prepared to move in on the company. They effectively sealed off the building, and my informants tell me they actually have run electronic sweeps of the building.”

O’Brien said only that Salick Health’s corporate offices on Beverly Boulevard were “secured . . . in a very responsible way” after Salick turned down Zeneca’s offer. And he denied that Zeneca wanted Salick out.

“It was our genuine wish that Dr. Salick stay as part of Zeneca,” O’Brien said.

Bernard Salick was unavailable for comment. He said in a press statement that he had been “released from my management responsibilities by Zeneca without cause.”

Salick doesn’t walk away empty-handed. His 25% stake in Salick is worth about $109.5 million, Grossman said. Zeneca paid $438 million for the company in two stages, beginning in 1995.

“I’m rich,” Salick, a 57-year-old kidney specialist, said after the 1995 Zeneca deal.

He founded Salick Health in the mid-1980s and built it into a nationally known company with 1996 revenue of $186 million. The company is best-known as a sort of HMO for cancer care, treating the hugely expensive disease at lower cost while striving to maintain medical quality.

Salick is known for his brash personality, hard-nosed business tactics and aggressive recruitment of celebrity physicians such as Peter Gale, the former UCLA physician who performed bone-marrow transplants on victims of the Chernobyl nuclear disaster.

O’Brien said he met with Salick Health’s senior executives Monday and that he anticipates no rash of management departures. “I think there are some extremely good people we’ve got here,” he said.

One who won’t be staying is Barbara Bromley-Williams, a senior vice president and director who left Salick Health in recent days, O’Brien said.

O’Brien is a 25-year veteran of Zeneca, who for 10 years was director of the firm’s worldwide pharmaceutical operations. He also is a former vice president of marketing for Zeneca’s U.S. drug operations. Most recently, he was chief executive of Zeneca Specialties, a subsidiary.

“I am confident of Salick Health Care’s prospects because of the strong foundation on which the company is built,” O’Brien said in a statement. “Every reliable projection indicates that the need for comprehensive cancer treatment will continue to grow in the U.S. and elsewhere for the foreseeable future.”

Zeneca, with 1996 revenue of $9 billion, is a major producer of cancer drugs and other pharmaceutical and chemical products.