Chiron Announces it will Expand Senior Management by Recruiting New Chief Executive Officer.

EMERYVILLE, Calif.--(BW HealthWire)--Jan. 29, 1997--Chiron Corporation (NASDAQ:CHIR) announced today that it will expand its senior management team by recruiting a new executive for the position of president and chief executive officer.

Chiron's current president and chief executive officer, Edward E. Penhoet, Ph.D., then will become vice chairman of the Chiron Board of Directors, and his commercial and functional operating responsibilities, along with certain operating responsibilities of Chiron's chairman, William J. Rutter, Ph.D., will be assumed by the new chief executive officer.

Both Rutter and Penhoet will remain actively involved in Chiron. As vice chairman, Penhoet will be responsible for developing policies and managing relationships with representatives of government, industry and local communities; maintaining effective interactions with Chiron's network of university and commercial collaborations; facilitating business integrations resulting from acquisitions; and corporate culture and values.

Rutter will continue as chairman with substantial focus on strategic planning and implementation, and will have executive responsibility for Chiron Technologies and other research operations. The presidents of Chiron's four commercial business units -- Chiron Diagnostics, Chiron Therapeutics, Chiron Vaccines and Chiron Vision -- will retain their existing scope and authority, and will report to the new chief executive officer, as will the heads of corporate departments currently reporting to Penhoet.

There will be no change to Chiron's corporate organization or governance. Rutter and Penhoet will continue with their current responsibilities until the new CEO joins Chiron, which is expected to be later this year.

"Over the past 16 years, Chiron has grown from a research company with 15 employees into the world's second-largest biotechnology company, with four commercial businesses and significant research operations that together employ 7,400 people in 30 countries," said Penhoet. "By virtue of our unique business strategy and our size and scope of activities, Chiron has become an industry leader.

"As Chiron's growth has accelerated in recent years, I have been spending more and more of my time dealing with government, industry and local communities about the policy issues that are vital to Chiron's future development and growth. Collaborations with universities and other companies continues to be an important strategy. I think that I can be particularly effective in nurturing these relationships, which now total almost 1,500. My experience within the Chiron organization enables me to be effective when integrating new businesses and teaching our mission and values.

"I believe that my most significant contribution to Chiron at this point can be made by directing my efforts toward these activities. A new chief executive officer will allow me to focus on these crucial aspects of Chiron's business and also will allow Bill to focus a greater portion of his time on strategy and research."

"The global scope and complexity of Chiron's commercial businesses require executives with broad, relevant experience managing healthcare operations," said Rutter. "We intend to strengthen our management team by adding a CEO who will have a singular focus on commercial operations so that we can take full advantage of Chiron's many commercial opportunities. Ed and I want to focus on activities upon which our experience and talents can have the greatest impact."

"Ed will apply his marvelous communications skills, his many relationships within industry, government and universities, his innovative approach to science and business and his understanding of Chiron's unique culture, to activities that are increasingly important to Chiron's continued development and success," Rutter added. "I will devote a greater portion of my time to innovation and strategy, to ensure that Chiron remains a leading science-driven company. Our management team strongly supports the action we are taking.

"Chiron has pioneered a collaborative strategy to access both technology and markets through partnerships with academic and research institutions and other companies around the world. We now have more than 1,400 agreements with universities and research institutions and collaborations with 64 other companies. This network is a core strength of Chiron. Nurturing and maintaining its effectiveness will be a key part of Ed's responsibilities.

"Our diagnostic and vaccines businesses and their integration with therapy in our disease control strategy require a new value paradigm that must be understood and supported by physicians, third-party payers and patients as well as political and social institutions. This is a major challenge and opportunity for Chiron. Ed has a unique ability to make a contribution to Chiron, the industry and society as a whole. I applaud his decision to take on this task," Rutter concluded.

In recent years, Chiron and Penhoet have become more involved in issues shaping the future of the biotechnology industry and healthcare research in the United States. Penhoet is a member of the Scientific Advisory Board to the U.S. Congress Subcommittee on Science and has testified before Congress, and written on the biotechnology industry and the role of federal funding in support of basic research. He is a member of the California Governor's Council on Biotechnology.

Penhoet also is a member of the Boards of Directors of the California Business-Higher Education Forum, the Biotechnology Industry Organization, the California Health Care Institute (a statewide coalition of industry and academia), the Bay Area BioScience Center, the Bay Area Council, the California Public Health Foundation, the Chabot Observatory and Science Center Foundation, the University of California System Biotech Advisory Committee, the UC Berkeley Chancellor's Biotechnology Planning Board and the Advisory Board for the Lester Center for Entrepreneurship and Innovation at UC Berkeley.

For 10 years prior to co-founding Chiron, Penhoet was a faculty member of the Biochemistry Department of the University of California, Berkeley, and continues as a dedicated adjunct member of the faculty, teaching each year. In May 1991, he received the first Distinguished Faculty Award from the Life Sciences Department of Molecular and Cell Biology at the University of California, Berkeley.

Chiron Corporation is a science-driven healthcare company that combines diagnostic, vaccine and therapeutic strategies for controlling disease. Chiron participates in four global markets: diagnostics; pediatric and adult vaccines; therapeutic; and ophthalmic surgical products for the correction of vision. Chiron has more than $1 billion in revenues derived largely from four commercial businesses -- Chiron Diagnostics, Chiron Therapeutics, Chiron Vaccines and Chiron Vision -- that sell products in 97 countries.

Through a fifth business, Chiron Technologies, the company has research programs underway in gene therapy and gene transfer, combinatorial chemistry, cardiovascular disease and critical care.

Chiron's achievements of the past 16 years include: development of the first genetically engineered vaccine, for hepatitis B virus; first sequencing of the HIV virus; discovery of hepatitis C virus and development of the first test to screen blood for this major cause of serious liver disease; the first drug to treat kidney cancer, Proleukin; the first drug to treat multiple sclerosis, Betaseron; and bDNA probes to quantify HIV and HCV, which have aided in more effective drug development and patient therapy.

CONTACT: Chiron Corporation, Emeryville

Larry Kurtz, 510/923-2476