Dublin, Ireland-based specialty pharmaceutical firm Warner Chilcott Plc (WCRX: Quote) Monday said it plans to restructure its Western European operations, as its osteoporosis drug Actonel (risedronate sodium) lost exclusivity in the region in late 2010. The restructuring plan is expected to be complete by the middle of 2012 and would impact nearly 500 employees.
The plan remains subject to consultation with local works councils in certain European jurisdictions.
Warner Chilcott's decision was after completion of a strategic review of its operations in its Western European markets where its bone drug Actonel lost exclusivity. The oral osteoporosis drug accounted for nearly 70 percent of Warner Chilcott's Western European revenues during the year.
Commenting on the company's restructuring plan, Hans van Zoonen, president, Europe/International and Global Marketing of the company said, "The restructuring initiative will allow us to focus on growth opportunities that match Warner Chilcott's key competitive strengths, including the launches of ATELVIA (risedronate sodium) and LO LOESTRIN FE (norethindrone acetate and ethinyl estradiol tablets, ethinyl estradiol tablets and ferrous fumarate tablets) in the United States."
According to the plan, the company will restructure its operations in Belgium, the Netherlands, France, Germany, Italy, Spain, Switzerland and the U.K.
In addition, the company intends to move to a wholesale distribution model in the affected jurisdictions to minimize future operational costs.
However, the restructuring will not impact its operations at headquarters, its facilities in Dundalk, Ireland, Larne, Northern Ireland or Weiterstadt, Germany or its commercial operations in the U.K, the company noted.
In connection with the restructuring, the company expects to record aggregate restructuring charges of around $120 million to $130 million in 2011 and 2012 related to employee severance and other charges.
For the first quarter ended March 31, the company expects to record about $42 million or about $0.16 per share in employee severance charges. It also expects to record aggregate charges of nearly $33 million or $0.13 per share in connection with its decision to repurpose its Manati, Puerto Rico manufacturing facility. Going forward, the facility will primarily serve as a warehouse and distribution service center, the company added.
On an adjusted cash net income basis, Warner Chilcott expects the impact of the European restructuring and Manati repurposing to be neutral to slightly accretive to its current 2011 financial guidance.
The company expects to update its detailed 2011 financial guidance when it releases its first quarter results in early May 2011.
WCRX closed Friday's regular trading at $24.02 on the Nasdaq.
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by RTT Staff Writer
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