Bristol-Myers CEO fired - effective immediately!

If The Wall Street Journal posted a breaking news story yesterday ahead of the official announcement, as Sarah Gilbert pointed out late last night, then it must have been true. And so it is. Bristol-Myers Squibb's board of directors has fired its chief executive officer Peter Dolan, effective immediately.

Not only has Dolan failed in his attempt to hold off cut-rate generics for Plavix, Bristol-Myers' top seller drug (among his other missteps over the years), but according to new information, a federal monitor also urged the company to fire the CEO and the General Counsel, Richard Willard (also to be dismissed).

With Apotex launching its generic Plavix earlier than expected, shareholders have intensified their pressure for a management change as Plavix contributes about 30% to Bristol's profits. But the calls to oust Dolan could be heard even before as analysts and investors found his performance lacking -- especially with the accounting scandal to inflate revenue that happened under his watch and the overpaying on drug deals. All left investors unhappy.

James Cornelius, formerly head of medical device maker Guidant Corp., was named by the board as the interim CEO. Cornelius is also a former chief financial officer for Eli Lilly.

Once the rumors of the possible management change started, Bristol-Myers shares have gained more than 1.5% after losing ground for quite some time during Dolan's years as CEO. Yesterday, Prudential even upgraded Bristol-Myers shares from underweight to overweight ahead of today's announcement. Analysts clearly believe the management change could win back investors' confidence.