January 3, 2018 / 4:57 PM / 2 months ago

Allergan to cut over 1,000 jobs as it works to cut costs

NEW YORK (Reuters) - Allergan Plc on Wednesday said it plans to cut over 1,000 jobs, more than five percent of its workforce, and eliminate an additional 400 currently open positions, as it works to cut costs in the face of new competition for its second most important drug, dry-eye treatment Restasis.

A sign marks Allergan's offices in Medford, Massachusetts, U.S., July 31, 2017. REUTERS/Brian Snyder

The company said the jobs and positions it plans to eliminate mostly focus on products and categories where the company has or expects to soon lose exclusivity.

The drugmaker said it expects to take a $125 million charge from the job cuts, primarily due to severance, most of which will be recorded in the fourth quarter of 2017.

It said cost savings from this restructuring program

should be around $300 million to $400 million per year. Allergan currently employs 18,000 people, according to its website.

In November, the company said it was working on a program to expand its base business and reduce costs so it could return to earnings growth by 2019, but did not disclose a specific strategy at that point.

Allergan worked hard in recent years to protect Restasis, which generated about $1.5 billion in sales in 2016, from generic rivals. It struck a controversial deal with a Native American tribe in September to shield review of the patents by U.S. regulators, drawing the ire of lawmakers and rival drug companies.

But in October, a Texas federal judge invalidated Restasis patents on grounds that they cover ideas that are obvious, making it possible for rival generics to hit the market as early as next year. Allergan has appealed the ruling.

Shares of Allergan rose $1.45, or 0.9 percent, to $171.77 in midday trading on Wednesday.

Reporting by Michael Erman; Editing by Chizu Nomiyama and Alistair Bell

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below