Scottsdale-based Matrixx Initiatives, Inc., the maker of the popular Zicam cold products, has named William Hemelt as its CEO. Hemelt was also elected to its board. Hemelt had served as Matrixx's acting President, COO, and CFO since October 31, 2008. Hemelt, 55, joined the company in June 1998. Hemelt's base compensation increased from $418,000 to $475,000.

Matrixx received a warning letter from the FDA on June 16, 2009 concerning violations of a number federal drug laws, regarding the sale of three of its intranasal zinc-based products. In addition, the FDA issued a warning to consumers to stop using the products because the products could cause a loss of the sense of smell (anosmia), either long-lasting or permanent. The three products in question accounted for 40% of Matrixx's $100 million annual sales.

The company expects that legal costs will reach $4 to $5 million per year. The company has said in its filings that it has sufficient financial resources to defend itself against the claims that have been filed to date

The company stock was $5.91 on September 21, 2009 which is near its 52-week low of $4.39.

John Laub is the Chairman of the Phoenix CEO-CFO Group.

1. "Matrixx Initiatives, Inc. Names William J. Hemelt President, CEO and Board Member." Company Press Release. PRNewswire. September 1, 2009.

2. Form 8-K. Matrixx Initiatives Inc. September 2, 2009.

3. "FDA Tells Scottsdale-Based Maker of Zicam Cold Products to Stop." John Laub. Phoenix CEO-CFO Group. July 2009.