November 23, 2015
By Alex Keown, BioSpace.com Breaking News Staff
HOLLAND, Mich. – Ten days after Perrigo shareholders rejected a takeover bid from Mylan, the company is laying off approximately 100 workers at its North American corporate offices in Allegan, the Holland Sentinel reported this morning.
Layoff notifications went out on Nov. 19, a company spokesperson told the Sentinel, but would not verify the number of layoffs, or which departments would be impacted. The layoffs are part of the company’s overall restructuring plan to increase profitability and help fend off a hostile takeover bid by Mylan. The plan, which includes an announced layoff of 800 employees, consolidation of its global supply chain, as well as operations and production management teams, is estimated to save the company about $105 million. Perrigo also plans to refine its portfolio, selling off its U.S. Vitamins, Minerals and Supplements business, which it projects will save $35 million annually.
Dublin-based Perrigo, which is primarily known for generic drug treatments, with a focus on cold and allergy drugs, has approximately 4,000 employees in Michigan. Arthur Shannon, Perrigo vice president of investor relations and global communications, told the Sentinel that Perrigo will continue to have a strong Michigan presence.
In September, Mylan announced a $27.3 billion buyout offer of Perrigo, a plan shareholders roundly rejected on Nov. 13.
“We have said all along that this offer from Mylan was a bad deal for our shareholders, as it significantly undervalued our durable business model and industry-leading future growth prospects,” Joseph C. Papa, chairman and chief executive officer or Perrigo said in a statement following the shareholder vote. “Now that the Mylan tender offer is behind us, we look forward to continuing to create significant value for our shareholders. Our confidence in Perrigo‘s compelling near- and longer-term growth prospects and our steadfast commitment to delivering returns to shareholders remain unchanged.”
Perrigo is up slightly this morning, trading at $155.06 per share. The stock has not yet recovered from the sharp dip from $160.03 per share it took after shareholders rejected the Mylan bid.
While Perrigo has been undertaking strict measures in its fight against Mylan, the company was able to acquire the U.S. rights to Entocort from AstraZeneca for $380 million. Entocort is a gastroenterology medicine for patients with mild to moderate Crohn’s disease. The treatment fits with Perrrigo’s pipeline of other gastrointestinal treatments, Papa said in a statement. Entocort has generated $89 million in sales for the first nine months of 2015.
In May, Ireland-based Perrigo Company plc acquired Patheon’s Mexican operations for $34 million. Perrigo said it acquired the Mexican operations in order to establish a toe-hold in the manufacturing of softgel products.
Earlier this year Perrigo acquired Omega Pharma, which Papa said provided the company with “a pan-European branded consumer healthcare business that is delivering greater benefits than we originally expected.” Two years ago, Perrigo acquired Elan Corporation . These moves fit into a strategy outlined by Papa, that includes “strong organic growth, a disciplined approach to M&A, and transparent, accessible corporate governance policies.”
