A longstanding and well-respected member of the in-house community, Felix Ehrat has abruptly stepped down from his role as general counsel (GC) of Swiss healthcare giant Novartis after becoming entangled in a controversy involving US President Donald Trump’s personal lawyer.
Ehrat said in mid-May he would retire from Novartis shortly thereafter. He had been GC and a member of the executive committee at the Basel-based pharmaceuticals company since 2011, but was forced to admit ‘an error’ relating to an agreement between the company and Michael Cohen – Trump’s lawyer.
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 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 in 2017 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.’
‘I take personal responsibility to bring the public debate on this to an end.’
Felix Ehrat, Novartis
Ehrat was replaced by the company’s chief ethics, risk and compliance officer Shannon Thyme Klinger, who joined the company in 2011 and was previously a litigation partner at Mayer Brown. On her appointment, Narasimhan said: ‘Shannon has a proven track record as a strong thought leader with a commitment to ethics and integrity. She brings the combination of private practice and industry experience in Europe and the US that we need, and I have no doubt that the company will benefit from her judgement and expertise.’
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: 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.