Shares in Osiris Therapeutics Inc. fell 7.6 percent Tuesday after the company announced that C. Randal Mills will step down as its president and CEO for personal reasons.
Mills will remain as a strategic advisor to the Columbia-based firm that develops stem cell-based products to treat conditions in orthopedic, sports medicine and wound care markets.
Lode Debrabandere, the firm's chief operating officer, will become president and CEO, pending approval of the Osiris board. Debrabandere joined Osiris in 2006 to lead its marquee unit developing the drug Prochymal to treat Crohn's disease.
The company's stock dropped $1.27 a share to close at $15.45 each in Tuesday Nasdaq trading.
Mill's departure follows a deal Osiris reached in October to sell Prochymal, the first stem cell drug to win government approval, for up to $100 million to a subsidiary of Australian company Mesoblast Ltd. Mesoblast agreed to pay $50 million for the technology behind Prochymal and the drug itself plus up to $50 million more if the drug passes clinical trials and regulatory reviews.
"Now that we have successfully transformed Osiris into a profitable company with a strong balance sheet and a solid pipeline, I look forward to contributing to the company's continued progress in a strategic role," Mills said in a statement.
Peter Friedli, a founder of Osiris and its chairman, called Mills, who led the company since 2004, "a transformational leader for Osiris and the entire field of regenerative medicine."
Other projects the company is working on include Chondrogen and Osteocel-XC, both drugs that stimulate bone regeneration. The firm also developed and markets a wound-care bandage called Grafix that uses stem cells.