Corporate Empire Left Guessing Who Would Replace Panic

COSTA MESA — As the flamboyant businessman Milan Panic thrusts himself into the international arena over his troubled homeland of Yugoslavia, the $1.3-billion empire he founded here is left wondering about its own future.

The most important question is: Who will step into Panic’s large shoes if he accepts the post of prime minister of Yugoslavia?

“It would be premature to talk specifically about that,” said ICN spokesman Jack Sholl, who fielded reporters’ requests for interviews with Panic most of Wednesday.

But it seemed immediately apparent that the 62-year-old Panic is leaving his corporate subordinates largely in the dark. Directors of the various boards that govern ICN’s family of companies said Wednesday that they still had not received confirmation of Panic’s departure and were wary of commenting.

Sholl, Panic’s longtime media adviser, was also largely left out of the loop.

Confirmation that Panic was going to formally announce his acceptance of the offer by Yugoslav President Dobrica Cosic this morning came not from the Costa Mesa corporate headquarters but from a Washington press aide.

The announcement will be made at the National Press Club headquarters in Washington, said press secretary Gus Weill.

Since early June, Panic has been out of touch and out of sight to reporters.

Sholl and other ICN spokesmen refused to divulge his whereabouts, adding to the mystique of a man who has experienced rocky times and harsh criticisms from some financial analysts, but has been undeniably successful in establishing a worldwide pharmaceutical giant from scratch.

Using political connections that he has built as assiduously as his pharmaceutical empire, Panic’s latest success has been in making inroads in Eastern Europe. In May, 1991, he spearheaded a 75% controlling interest in Yugoslavia’s largest drug manufacturer, renaming it ICN Galenika, situated in a suburb of Belgrade.

ICN Galenika, as it turned out, was a financial masterstroke, contributing $225 million in sales to ICN’s 1991 bottom line.

He has also been instrumental in establishing relationships in other formerly Communist countries, such as Russia and Poland, where he is currently negotiating purchase of Pharmaceutical Works, located near Warsaw.

Whether Panic’s focus on the potentially lucrative Eastern Europe market will change under someone else’s leadership was unknown.

Sholl said that the corporation had a routine “succession plan” to replace Panic, who is chairman of the board and chief executive officer for ICN and the drug maker’s three subsidiaries. He is also president of ICN Pharmaceuticals, the parent company, and ICN Biomed Inc.

The plan, Sholl said, would “provide for continuity of management.” He declined to elaborate.

“It is already in place,” Sholl said. “It’s a plan for a smooth and orderly transition. The board has had it in place for some time, in the event that the chairman of the corporation should leave for any reason.”

He said that Panic’s replacement for the various positions he holds in the family of companies could be announced as early as today. Panic, once finished with his Washington press conference, is not expected to return to Costa Mesa, Sholl said.

“Things are moving real fast,” he said.

Some analysts who say that Panic’s shoot-from-the-hip-style of business has alienated him from some in the financial community, welcomed the news that Panic would take the prime minister post.

“It goes along well with his personality,” said biomedical analyst James D. McCamant, who publishes a biomedical stock newsletter in Berkeley. McCamant, who has been critical of Panic’s business dealings in the past, said that Panic is more suited for politics than business.

“This doesn’t surprise me,” he said.

Other analysts who have covered ICN, however, said that history will show that Panic’s unabashed way of mixing business and politics was instrumental in creating a conglomerate that will some day rival giants Johnson & Johnson and Merck & Co.

“He sure showed he has political savvy to get such a sweetheart deal with Galenika,” said Mark Matheson, an analyst with Crowell Weedon & Co. in Los Angeles.

Milan Panic

Company: ICN Pharmaceuticals Inc.

Position: Chairman, chief executive officer

1991 Compensation: $6.1 million

Age: 62

Birthplace: Belgrade

Immigration to U.S.: 1956; naturalized in 1963

Professional milestones: 1960 -- founded ICN Pharmaceuticals / 1991 -- Assumed control of ICN Galenika.