Joseph Allegra, M.D., joined T2 in August 1989, when Thomas Haire hired the former chairman of the Department of Medicine at the University of Louisville to succeed Tommy Carter as president and chief operating officer of the company.
Mr. Carter, 51, who aided Mr. Haire in starting the company in 1984, served as president and chief executive officer of T2 until he retired from the company in 1989. Since then, Mr. Carter has been affiliated with the company on an informal basis.
During the first three years of Dr. Allegra's leadership, T2 watched its profits skyrocket, due primarily to the success of its physician management agreements. Under these agreements, the company would contract to manage a physician-owned home infusion center and later buy out the physician ownership in exchange for T2 stock. It then would rely on those same physicians-now T2 stockholders-to continue to refer patients to the centers owned by T2.
For a while, that strategy was quite successful. For example, T2's net income for fiscal 1992 reached $59.3 million on revenues of $242 million. Dr. Allegra and Mr. Haire also profited quite handsomely.
For example, during a one-month period from December 1991 to January 1992, Mr. Haire collected $11.3 million by cashing in some 208,000 shares of T2 stock at a price ranging from $53 to $58 per share, according to documents itemized in an August 1993 class action lawsuit filed against T2, Dr. Allegra and Mr. Haire. Dr. Allegra exercised options to sell 355,551 shares of T2 stock at prices ranging from $44 to $60 per share between January and December 1992, collecting approximately $18.2 million, court documents indicate.
By October 1992, Dr. Allegra had been promoted to chief executive offer of the company. In announcing the appointment, Mr. Haire said, "The spectacular growth and success of T2 over the last three years is a direct result of the tremendous job that Dr. Allegra, Chief Operating Officer J. Lee Ledbetter and the rest of T2's management and employees have done."
However, the good times apparently were short-lived. Over the next year, the company dealt with an HHS fraud investigation, a Securities and Exchange Commission probe and a failed buyout attempt.