Heads have rolled at Encorium Group following the US-based contract research organisation’s (CRO) decision not to pursue a proposed merger with investment vehicle Linkcon.

The main victim is Dr Kenneth Borrow, who last February ceded his responsibilities as Encorium’s chief executive officer (CEO) to Dr Kai Lindevall, previously the CRO’s president of operations for Europe and Asia. Borow retained his position as president of Encorium while taking up a new role as chief medical and strategic development officer, with a remit to focus more on the expansion of the company’s consultancy services and global business development initiatives.

In the latest management shake-up, announced hard on the heels of the Linkcon pull-out, Lindevall has been replaced as CEO by Dr David Ginsberg, who also takes on the mantle of president. Lindevall assumes the newly created role of executive chairman but Borow “is no longer an employee of the company”, Encorium noted.

Ginsberg, who was previously vice-president of medical affairs and clinical affairs for speciality pharmaceutical company KV Pharmaceuticals, will take over responsibility for Encorium’s North American operations from Borow.

Lindevall described Ginsberg’s appointment as “an exciting and positive step forward” for Encorium, citing the new CEO’s substantial experience and knowledge of the clinical research industry. Before joining KV, Ginsberg was chief medical officer and senior vice-president of US-based CRO Omnicare Clinical Research. The reshuffle would also “allow me to focus more intently on the company’s strategic growth plan”, Lindevall said.

Also departing are two board members, Scott Jenkins and Christopher Meshginpoosh, who resigned with immediate effect. They will be replaced by David Morra, a managing director of private equity firm Union Partners, and by an unnamed director of Prologue Research International, who will join the board once Encorium completes its proposed acquisition of Prologue, a US CRO specialising in oncology.

Encorium’s shares dived by nearly 50% last week after it ended negotiations with Linkcon in the face of uncertainty over the latter’s pending CRO acquisitions in India, China and Latin America. These were a key component of the merger plan, which Encorium saw as an opportunity to compete in a global marketplace.

The group also negotiated a lower acquisition price for Prologue, which has made some shareholders uneasy about a deal Encorium expects to position it as “one of the strongest oncology-specialised CROs in the United States and Europe”. The Prologue acquisition is scheduled to close at the end of this week.