By Andrew Callus and Noëlle Mennella
PARIS (Reuters) - Barring a last-minute breakthrough, drugs firm Sanofi's Chairman Serge Weinberg may have to acknowledge in his results presentation next week that the hunt for a new chief executive is not going well.
At least three potential candidates in a narrow field have turned their back on the job heading France's largest company.
The manner of Chris Viehbacher's shock dismissal three months ago, and the surprisingly small pay-off he won last week, have cast a long shadow over the process.
"I think it is going to take time," said a source close to the company. "What we risk missing in the meantime is a strategic vision that you cannot have without a deep knowledge of the pharmaceuticals sector."
Last week Christophe Weber, the French chief operating officer of Japan's Takeda Pharmaceutical Co, told Reuters he had rejected an approach.
Paris-schooled Olivier Bohuon, chief executive of British medical devices maker Smith & Nephew, told staff in November he had no plans to leave, and in the same month, former Wyeth boss Bernard Poussot joined the board of Sanofi's rival Roche.
AstraZeneca Chief Executive Pascal Soriot, another prominent French pharma executive, has played down any interest by saying he sees himself as more Australian than French.
Weinberg, who will be 64 on Feb. 10 and does not have a pharmaceuticals background besides his five years on the board, is running Sanofi himself while board member Jean-Rene Fourtou conducts a search -- one which began well before Viehbacher was fired.
Weinberg has said an understanding of Sanofi's French culture is important to the search for "mainly outside candidates".
But he has rebuffed suggestions that non-French candidates are unwelcome, despite his experience with the German-Canadian Viehbacher, who ruffled establishment feathers by keeping secret plans to cut French jobs, and by moving his domicile to the United States.
Nevertheless, insiders say a command of the French language would be important.
Viehbacher was fired abruptly on Oct. 29 last year, hours after he had presented a poor set of third-quarter results, and days after a leaked letter he sent to the board showed he had found out months earlier of Weinberg's plan to get rid of him.
The news came as a shock to investors, who had hitherto seen the outspoken and affable former GlaxoSmithKline executive as a strong manager. Weinberg put the sacking down to poor execution and lack of communication with the board -- citing partly a poor outlook for the diabetes division, which accounts for more than 30 percent of profits.
SEVERANCE QUESTIONS
It has not been all bad news for post-Viehbacher Sanofi. Last week, U.S. health regulators accepted its application to review a potent cholesterol drug on a priority basis, potentially giving it the upper hand in a fierce race to market with Amgen.
And Sanofi's shares, down about 1.7 percent at 82 euros since the sacking and the poor third-quarter figures, have recovered most of the losses suffered after the initial shock.
But some believe the discount they carry to their peer group should be bigger. Citi analysts earlier in January downgraded Sanofi to 'Sell' from 'Neutral', targeting a 70 euro price that implies a 2016 price-to-earnings ratio of 13 times compared with a sector average of 15.
Meanwhile, last week's announcement of Viehbacher's severance settlement has raised new questions about whether there is more behind his dismissal.
Viehbacher received 4.44 million euros ($5 million) in severance, even though the amount stipulated under the terms of his employment was 5.92 million euros.
"The trouble with finding a successor hinges on the fact that we don't know the real reason he was fired, and because a lot of people are asking themselves questions about the subject," said an industry insider who has spoken to some potential candidates.
"The very low pay-off he received only reinforces the idea that the reasons he was fired are not the ones that have been talked about."
A Sanofi spokeswoman confirmed that the negotiated pay-off was lower than specified in Sanofi's annual report filing but she said these terms did not apply because his dismissal was not related to a change in control or strategy.
She declined to comment further on why his severance package was so low.
Viehbacher did not respond to an emailed request for comment.
Fourth-quarter results are due on Feb. 5.
($1 = 0.8840 euros)