Premier Laser’s Founder Ousted as Chairwoman
Colette Cozean, the founder of Premier Laser Systems Inc. who attracted national attention for a dental laser created to treat tooth decay painlessly, was ousted Wednesday from the Irvine firm.
Cozean, who relinquished her chief executive and president positions in November, was replaced Wednesday as chairwoman and “removed” as chief technology officer.
Premier Laser said she will remain on the seven-member board but is no longer a company employee. The board elected outside director Fredric J. Feldman, 59, as its chairman.
Cozean, who in 1991 was one of the few women in the nation to form a technology company, said she may yet resign.
“The company has been lauded for the number of . . . products that have come to market,” said Cozean, 40. “Considering that, these changes are surprising.”
Two executives who worked closely with her on product development--Tom Hazen, executive vice president of operations, and Jeff Anderson, vice president of regulatory affairs--also have been forced out, she said. The company did not comment on any other executive departures.
“Certainly, it looks like a palace coup,” said John F. Doss, an analyst with New York brokerage Dominick & Dominick.
Industry experts say Cozean’s ouster may have had more to do with a conflict between Cozean and Michael J. Quinn, the man she helped bring in to replace her as president and chief executive. Cozean said she was never even shown a copy of the press release announcing her removal.
Quinn said he and the board acted to remove her because he and directors want to take Premier beyond research and development.
“We want to become a sales and marketing-driven company rather than just an R&D; incubator,” he said. “We want to broaden our reach in terms of customer base, which has been very narrow. Most important, we want to be a profitable company, which we’ve never been able to deliver.”
In the past 2 1/2 years, the company has lost more than $72 million, including $5.1 million in the first half of its current fiscal year, which ends March 31.
Analysts had praised Cozean’s ability to introduce and get federal approval for new products, but criticized her as a manager.
“The company is all her founding genius. There’s no question about that,” said John Westergaard, chairman of Westergaard.com Inc., a New York City publisher of several online financial newsletters. “But it’s another thing to make it all work.”
In 1998, Premier was hurt financially in a dispute with a major supplier. In addition, its auditor resigned and trading in its stock was suspended for five months. Last January, the company agreed to settle 19 shareholder lawsuits for almost $14 million. The company has denied allegations in the suits of fraud and securities violations.
Quinn said a severance package has yet to be worked out with Cozean. In 1998, the last year for which documents are available, Cozean earned $165,000 and received a $100,000 bonus and options to buy 1 million shares of stock.
She is the company’s single biggest individual shareholder with about 4.3% of the stock, according to the company’s 1999 proxy statement, which provides information to shareholders.
The company’s actions were disclosed after the market closed Wednesday. Premier’s stock rose 9 cents a share to close at $1.56 in Nasdaq trading.
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Premier Laser Systems Inc.
The company’s stock price surged after a promising dental laser received regulatory approval in May, 1997, but has sagged in recent months. Monthly closing prices:
1997, April: $6.25
Wednesday closing price: $1.56
Net Sales (in millions)
1995: $1.3
1999: 14.0
Net Income/Loss (in millions)
1995 -3.8
1999 -29.0
NOTE: Net sales and income figures for fiscal years ending in March
SOURCE: Bloomberg News
