Sam Isaly Remains at OrbiMed as Investors Consider Options

One month after announcing his intention to step down amid sexual harassment allegations, Isaly continues to manage the biotech hedge fund.

Orbimed’s New York Office. (Courtesy Google Maps)

Orbimed’s New York Office.

(Courtesy Google Maps)

OrbiMed Advisors founder Samuel Isaly, who said he would retire in the wake of sexual harassment claims, has not stepped down from managing the hedge fund more than a month later.

The announcement of Isaly’s retirement came just two days after Stat, a healthcare-focused news site, published allegations from multiple OrbiMed employees that Isaly had harassed and demeaned women working at the firm. On December 7, OrbiMed said Isaly, 72, would retire “pursuant to years-long succession planning discussions.”

The firm did not disclose when Isaly planned to step down.

Evidence suggests that Isaly is still working at the hedge fund. Isaly’s signature appeared on a Securities and Exchange Commission filing on January 3, which Stat first reported on January 5. The filing listed Isaly a “managing member” at OrbiMed Advisors. A person with knowledge of the situation confirmed to Institutional Investor on January 3 that Isaly was still working for OrbiMed.

A representative for Isaly directed a request for comment to OrbiMed. W. Carter Neild, a general partner at OrbiMed, did not return a phone call seeking comment.

[II Deep Dive: Their Hedge Fund’s Founder Was Accused of Sexual Harassment. Here’s What They Did Next.]

In the statement announcing Isaly’s retirement, OrbiMed said he will be replaced as managing partner by a management committee that includes Sven Borho, Carl Gordon, and Jonathan Silverstein.

Although the statement made no mention of the sexual harassment claims, an investor letter obtained by Institutional Investor said that the incidents cited by Stat were “concerning,” and the hedge fund had hired an outside law firm – Manhattan-based Sullivan & Cromwell, according to a person familiar with the matter – to investigate the allegations.

“OrbiMed takes gender equality seriously and wishes to encourage a supportive work environment and equal opportunity for all employees,” the letter stated.

Still, some investors are considering dropping OrbiMed from their portfolios. Following the publication of OrbiMed’s client letter, the chief investment officer of a U.S. endowment wrote to II saying that he planned to connect with other limited partners to discuss their views on the situation.

Another investor told II on January 3 that despite OrbiMed’s stellar returns, “I’m leaning towards getting out.”