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Novartis GC Ehrat steps down over ‘error’ in Trump lawyer agreement

Veteran group general counsel of Swiss healthcare giant Novartis, Felix Ehrat, is standing down after admitting ‘an error’ relating to the company’s former agreement with US President Donald Trump’s personal lawyer.

Ehrat (pictured) will retire from Novartis in June, the company said on Wednesday (16 May). Ehrat, who has been GC and a member of the executive committee at the Basel-based pharmaceuticals company since 2011, will be replaced by chief ethics, risk and compliance officer Shannon Thyme Klinger.

A statement from Novartis said Ehrat was retiring because of questions in the US about the company’s former agreement with Essential Consultants, which is owned by Trump’s personal lawyer, Michael Cohen. It was recently revealed that Novartis made monthly payments, totalling $1.2m, seeking guidance on how the Trump administration might approach US healthcare policies.

The contract was approved under former chief executive Joe Jimenez last year but ended this year. Jimenez left the company in September.

Ehrat commented: ‘Although the contract was legally in order, it was an error. As a co-signatory with our former CEO, I take personal responsibility to bring the public debate on this matter to an end.’

Novartis chief executive Vas Narasimhan said: ‘During his term as group general counsel, Felix was instrumental in further developing the global legal department of Novartis, and he played a key role in the executive committee with his proven expertise. The Novartis leadership owes him considerable thanks for his many contributions and wishes him all the best in his future endeavours.’

Ehrat has long held a commanding reputation in the in-house community, heading a team of close to 1,000 people and overseeing legal and commercial risk in more than 180 markets. He was previously managing partner of Zürich-based firm Bär & Karrer, where he worked for 25 years as a corporate and M&A lawyer.

He led Novartis through some of its most transformative deals, in 2015 helping it complete the final stage of its asset-swap deal with GlaxoSmithKline (GSK): part of a hugely complicated three-stage process involving £11bn of assets that saw the two companies combine their consumer healthcare businesses while swapping non-core lines.

Hamish.mcnicol@legalbusiness.co.uk