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EXCLUSIVE: Ousted Paradigm Chief Says He May Sue Board

NEW YORK, Feb. 27 - Ousted Paradigm Genetics president and CEO John Ryals said he may "take legal action" against Paradigm's board, he told GenomeWeb in an interview on Wednesday.


"It's a bad situation," said Ryals, who spoke from a golf course not far from his home in Cary, NC. "I don't agree with what took place. I may have avenues to pursue.


"There could be legal proceedings going on," he added. "I might take some legal actions."


Ryals, who said his dismissal "came as a surprise," would not comment on events that led to the board's decision, which was made public on Tuesday, or the nature of any lawsuit. However, he did characterize the move as "a plain sort of power play from a single board member. That's my impression."


Though Ryals, a tall, broad-shouldered Texan, would not say which board member initiated the "power play," sources close to the company suggest it was likely Steven Burrill, the board's chairman.

Burrill, CEO of Burrill & Company, a private merchant bank that deals with biotech companies, has sat on Paradigm's board since March 1999 and was named chairman nine months later. He did not return telephone calls seeking comment.

Burrill also sits on the boards of AgraQuest, Axis Genetics,, DepoMed, Cross Atlantic Partners, Genitope Corporation, Promega, Third Wave Technologies, Transgene, and UltraOrtho, according to Paradigm's web site.


Paradigm's other board members are Robert Goodman, a member since 1998 and a professor of plant pathology at the University of Wisconsin-Madison; Susan Harlander, a member since May 2001 and president of a privately held biotech consulting firm; Mark Skaletsky, a board member since March 2001 and a former chairman of the Biotechnology Industry Organization; Michael Summers, managing partner of Summers Associates, a UK-based business-development firm, has been on the board since March 1998; and Heinrich Zinsli, a board member since June 1998 and former chairman of Discovery Technologies.


Melissa Matson, a Paradigm spokeswoman, would not comment, opting instead to read from a company statement: "Paradigm Genetics is going through a period of transition," she said. "The decision to terminate John Ryals was a difficult one for the board.

"The management team wished John the best going forward," she continued. "The management team is unified and ready to work hard to do the very best to continue to build a great company."


Matson also said that the company will "elaborate further on [its] strategic direction" in a conference call on March 4.

Paradigm's partnerships

Ryals' dismissal has also put a question mark over the many partnerships, research collaborations, and licensing agreements it has struck with industry and academia of the years. Sources say that many of these wouldn't have closed without Ryals' many contacts within the genomics universe, and the former chief echoed that notion.


"[The partnerships and collaborations] were set up because I had a pretty big reach in the industry," said Ryals. He chose not to speculate on the fate of these deals, which include agreements in one form or another with companies like Agilent, Bayer, Celera, Lion Bioscience, Thermo Finnigan, and StemCo, and most recently VDDI and Duke University.

Asked to comment on the current dynamic between Paradigm, its partners, and Ryals, Matson, the spokeswoman, said that Paradigm has "contacted all of our partners and talked through the situation with them, and they are willing and ready to work with the new team."


Ryals, as an officer at Paradigm, also sat on the board and said he has no plans to relinquish his seat. "I don't to intend to resign from the board. Sure I will pursue other interests," he said. "I have a number of other interests."


And just what is he pursuing today?


"Well, I was going to be pursuing the 18th green if the weather was warmer.... "

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