Orbimed Capital's Samuel Isaly has stepped down from his role as portfolio manager of the Worldwide Healthcare, after the group hired an external law firm to investigate allegations that he harassed and demeaned women for years, claims which he denies.
The following announcement was released to the stock exchange earlier this morning: "The board of Worldwide Healthcare Trust has been advised by the partners of OrbiMed Capital, the company's portfolio manager, that Samuel Isaly is to step down from OrbiMed Capital.
"Accordingly, the company announces that in consequence Mr. Isaly will be retiring from the board of the Company, and also from his portfolio management responsibilities."
It added ongoing management responsibility for the company's portfolio will otherwise remain unchanged, led by Sven Borho, managing partner of OrbiMed, and Dr.Trevor Polischuk working with the rest of the OrbiMed team which, together with Isaly, has been responsible for managing the company's investment portfolio over the last 22 years.
"The board would like to express its appreciation for Mr Isaly's contribution to the success of Worldwide Healthcare Trust during his time with the company," it added.
A similar statement was released in relation to the Biotech Growth trust, another trust run by the company's investment portfolio management team which said management will continue to be led by Geoff Hsu and Richard Klemm.
Five former employees have accused Isaly of "perpetuating a toxic culture of sexual harassment", in an article published in medical trade title STAT News on Monday.
They told the publication the 72-year-old regularly subjected young female co-workers to demeaning, sexist comments and projected pornography on large screens on the firm's trading floor.
However, none of the former employees who spoke with STAT allege that Isaly touched them physically in a sexual way.
Four women said they repeatedly complained about Isaly's behavior to senior executives at OrbiMed but no action was taken.
In a previous statement, OrbiMed said: "The incidents cited are concerning and OrbiMed has retained the services of an outside independent law firm to investigate the matter. OrbiMed takes gender equality seriously and wishes to encourage a supportive work environment and equal opportunity for all employees."
Meanwhile, the board of the Worldwide Healthcare trust said in a statement: "The board of Worldwide Healthcare trust has been advised by the general partners of Orbimed Capital, which acts as portfolio manager to the company, of a statement released late on 5 December concerning founding partner Samuel Isaly, who is the subject of a press article containing allegations of harassment.
"Samuel Isaly, who is also a director of the company, denies the allegations. OrbiMed is retaining the services of an outside independent law firm to investigate the matter. The independent members of the board remain closely in touch with OrbiMed and will keep shareholders informed of any relevant developments."
A spokesperson for the trust said before this morning's announcement it was business as usual as far as they are concerned and Isaly is among the team of managers running the trust.
Isaly, who suffered a paralyzing injury in his senior year of high school which left him without the use of his legs, has been active in global healthcare investing and analysis since 1968 when he joined Chase Manhattan Bank. He has also held roles at Merrill Lynch, Legg Mason, and S.G. Warburg, before launching OrbiMed's asset management business in 1989.
He has managed the Worldwide Healthcare trust since launch in 1995. Over three years, the trust has returned 46% compared to 38% for the IT Biotechology and Healthcare sector and 31% for the MSCI World/Healthcare index, according to FE. Since Monday, the trust's share price has fallen 2%.
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