By Peter Galuszka
Star Scientific is setting itself for a future without its high profile CEO, Jonnie R. Williams, a prominent figure in the Robert F. McDonnell GiftGate scandal.
On Halloween, the Henrico-based dietary supplement maker announced that it will undergo a shuffle at the top. Williams will leave in December, clearing the way for Dr. Michael J. Mullan, now head of the Roskamp Institute in Florida and an expert on Alzheimer’s disease, to become chairman and CEO.
Also gone will be Paul Perito, now president. Another telling switch: Star Scientific will be renamed Rock Creek Pharmaceuticals.
It appears that the money losing outfit (negative $3.4 million in the third quarter of this year just announced) wants to flush Williams down the money and memory hole. A clue is that the word “Star” has long been a favorite of the iconoclastic salesman. His aviation companies had the word in their names. He lives at a 29-acre estate in Goochland County on “Starwood” Lane.
So why now after losing money for more than a decade?
My best guess is that it is somehow linked to the federal probe of McDonnell and his wife who received tens of thousands of dollars in gifts, favors and loans from Williams.
The feds appeared to be close to indictments in the late summer but something slowed everything down. It could be that their case ran into bumps. It could be that the U.S. Attorney was resigning as he had long intended to do. It could be that the feds felt that taking action too close to the Nov. 5 election for McDonnell’s election just wouldn’t be right.
Well, consider the timing. Star announced Williams’ resignation just a few days before the election. Star has also said in earlier securities statements that it does not expect Williams to face indictments and that he and Star are helping the federal prosecutors.
As for McDonnell, not a peep, other than his op-ed pieces in the state’s leading conservative newspaper that Washington should follow the “Virginia Way” of bipartisanship. Also, he’s been meeting with Gov.-elect Terry McAuliffe about a transition.
But does Star suspect something we don’t know? Maybe, but there are some logical reasons for a makeover. Williams represents out-of-step salesmanship and tobacco-based products. Fact is, Star has been out of the tobacco business for a few years now, even though its prime if not sole product is Anatabloc, a dietary supplement derived from tobacco-based anatabine.
The people running with the ball on Anatabloc are scientists like Mullan who seem to be finally showing Williams the door, although Williams has for years been associated with the the Roskamp Institute, located in Sarasota, Fla. The organization gets money from the U.S. National Institutes of Health and does research into Alzheimers, which Star’s top executives believes can be treated with Anatabloc. The location explained some of the trips to Florida by Maureen McDonnell in Williams’ private jet aircraft.
The Roskamp Institute does research for other neurological disorders and may be looking into post-traumatic stress disorder that afflicts men and women who have served in combat.
Changing everything, including the name to the very pastoral and genteel sounding “Rock Creek Pharmaceuticals” from “Star Scientific” is a time-honored corporate ploy to bury the past.
Consider First Union, a Charlotte bank that ran into a lot of problems for its lousy customer service back in the 1990s. Winston-Salem based Wachovia was having its own problems with credit but always a strong reputation for service. So, when First Union merged, it ran the show but used the Wachovia name. To no avail, by the way, because Wachovia had to be saved by Wells Fargo during the 2008-2009 financial crisis.
Or consider another venerable name, “Philip Morris.” After a wave of health-related mega lawsuits, Philip Morris USA became part of the flaccid-sounding “Altria” while “Philip Morris International” skipped off to Switzerland.
“Rock Creek Pharmaceuticals” sounds totally un-Virginian and non-tobacco. It bespeaks babbling brooks running through the richer sections of Washington D.C.
In other Star, err, Rock Creek, news, Golf Hall of Fame star Nancy Lopez is joining fellow golfer Fred Couples and tennis star John Isner as a Brand Ambassador for Anatabloc.
As for Williams (who was that guy?), he stays on for a year after the Dec. 27 board meeting and then, presumably vanishes into the dustbin of Virginia history. Unless, of course, he becomes a “Star” witness for the prosecution. Pun intended.