Organon CEO Kevin Ali Resigns Amid Audit Probe Into Wholesaler Sales Practices

• Organon said that the investigation found that certain wholesalers in the United States were asked to buy more Nexplanon than they needed.
• The company said that the investigation found these sales represented less than 1% of its consolidated revenue for the year ended Dec. 31, 2022, or Dec. 31, 2024, as applicable.
• Organon said that the board of directors has appointed the company’s Executive Vice President and Head of Manufacturing & Supply, Joseph Morrissey, as its Interim Chief Executive Officer.

Organon (OGN) on Monday announced the resignation of Kevin Ali as Chief Executive Officer and a member of the board, in connection with an Audit Committee investigation into sales to wholesalers.

Shares of Organon were down nearly 22% in early trading. The company said that after concerns regarding its wholesaler sales practices for its Nexplanon product were brought to the board’s attention, the Audit Committee oversaw an independent, internal investigation into the matter.

Organon said that the investigation found that certain wholesalers in the United States were asked to buy more Nexplanon than they needed at the end of the fourth quarter of 2022, the third and fourth quarters of 2024, and the first, second and third quarters of 2025.

Retail sentiment on Organon remained unchanged in the ‘bullish’ territory, with message volumes at ‘high’ levels, according to data from Stocktwits.

Investigation Details

Organon said that the investigation found that certain wholesalers in the United States were asked to buy more Nexplanon than they needed at the end of the fourth quarter of 2022, the third and fourth quarters of 2024, and the first, second, and third quarters of 2025.

The company said that the investigation found these sales represented less than 1% of its consolidated revenue for the year ended Dec. 31, 2022, or Dec. 31, 2024, as applicable, but enabled Organon to meet guidance or certain external revenue expectations.

Organon noted that the board determined that these wholesaler sales practices were improper and certain of the company’s prior statements were inaccurate or incomplete.

“While the findings to date do not necessitate a restatement or revision to any previously issued financial statements, the company is taking remedial actions to improve its financial controls and address any material weaknesses,” Organon said.

In connection with the investigation, the company said that it terminated the employment of its Head of U.S. Commercial & Government Affairs, and there has been no finding that the company’s Chief Financial Officer was aware of the improper wholesaler sales practices.

Interim CEO

Organon said that the Board of Directors has appointed the company’s Executive Vice President and Head of Manufacturing & Supply, Joseph Morrissey, as its Interim Chief Executive Officer.

The company said Board Chair Carrie S. Cox will also take on additional responsibilities on an interim basis as Executive Chair to support Morrissey in his new role. The Board is initiating a search for a permanent CEO, including both internal and external candidates, Organon said.

Shares of Organon have declined nearly 48% in the last 12 months.

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