Valeant shuts plant in Brazil, second to follow
Canadian firm Valeant Pharmaceuticals has closed down one of its facilities in Brazil and will shutter a second in the first half of this year as it trims down its manufacturing network.
The plants were inherited by Valeant as part of its acquisition of Brazilian branded generic and over-the-counter medicines company Probiotica Laboratorios last year in a 150 million real ($85 million) deal.
A second facility in Brazil will be closed by the end of the first half of 2013, leaving the company with one remaining plant in the country, said Valeant chairman and chief executive Michael Pearson in a conference call with analysts last week.
The company's Bourdon plant in Canada is also set for closure and the company said recently it would terminate a collaboration with a Puerto Rican contract manufacturer as it continues to consolidate its production capacity.
Towards the end of 2012 Valeant closed its $2.6 billion acquisition of dermatology specialist Medicis Pharmaceuticals, but Pearson said on the conference call that this would not provide any additional opportunities for facility consolidation as Medicis has relied on contract manufacturers to make its products.
"Many of them are the same ones we use, so over time as contracts expire we would hope to gain some leverage there," he said, adding: "in the end we may end up moving some of their products into our facility in Lowell and also in Steinbach in Canada."
The company has already wielded its axe on Medicis staff, however, letting some 300 people go as it went about saving costs of around $200 million.
Pearson made the comments as he predicted an increase in group sales from $3.4-$3.6 billion in 2012 to $4.8 billion in 2013, with further growth also in the offing.