Struggling West Lafayette-based life science contract research firm Bioanalytical Systems Inc. is searching for a new top executive. Richard M. Shepperd, 69, announced his retirement on Wednesday.
Shepperd, who joined the firm in October 2006, immediately relinquished his job as company president. He also announced his intention to retire from his post as CEO and his seat on the Bioanalytical Systems board on Feb. 12.
Bioanalytical Systems replaced Shepperd on an interim basis with Anthony Chilton, 53, the firm’s chief operating officer. The company intends to conduct a national search for a permanent CEO.
Located in Purdue University’s Research Park, Bioanalytical Systems was founded in 1974 by Pete and Candace Kissinger. Over the years, it grew into one of Indiana’s largest locally-based life science firms. The couple led the company until August 2007, when they quietly stepped down from their management posts. He had been CEO; she was vice president of research. The Kissingers remain Bioanalytical Systems’ largest shareholders, with a 26-percent stake.
Bioanalytical Systems originally hired Shepperd to cut costs. He ended up presiding over one of the roughest patches in the firm’s history. Its annual revenue declined from $45.2 million in 2007 to $31.8 million in 2009. And the modest $926,000 Bioanalytical Systems booked as profit in 2007 was followed by two years of losses: $1.5 million in 2008 and $5.5 million last year.
As a result, Bioanalytical Systems’ stock price has tumbled. Before the recession began, the company’s shares traded on NASDAQ for more than $8. Early Thursday, they were worth 80 cents each.
The company Shepperd departs is much smaller than the one he inherited. At its peak, Bioanalytical Systems had 375 employees. According to the firm’s 2009 annual report, headcount had shrunk to 257.
Shareholders have been attempting to turn Bioanalytical Systems around. On April 6, 2009, the Kissingers sent a joint letter to the company’s board and the Securities and Exchange Commission, outlining concerns about its direction and management. Their concerns were shared by Wisconsin stockbroker Thomas Harenburg, who sent a letter of his own. With a 5.6-percent stake, Harenburg is Bioanalytical Systems’ next-largest shareholder.
Last summer, both Kissingers wrote fresh letters petitioning Bioanalytical Systems to replace several of the company’s board directors. In October, the company added Harenburg nominee David L. Omachinski. In November, Bioanalytical Systems added one of the Kissingers’ candidates, John Landis.
On Wednesday, the company also announced board chairman William Baitinger had retired. His replacement, Charlene Sullivan, is an associate professor at Purdue’s Krannert Graduate School of Management. Pete Kissinger is co-chairman of Purdue’s Department of Chemistry.
“The board would like to express its sincere appreciation to Mr. Shepperd for his strong leadership at a critical time in the company’s history,” Bioanalytical Systems board member David W. Crabb said in a statement. “We are confident that Dr. Chilton has the background, knowledge and industry experience to effectively lead the company into the future.”