Impax cuts staff at troubled California plant
pharmafile | June 11, 2013 | News story | Manufacturing and Production |Â Â FDA, Impax, RytaryÂ
US generic drugmaker Impax Laboratories has said it plans to axe a tenth of its workforce and transfer production away from its Hayward, California, facility to a plant in Taiwan.
Impax said in a statement that the majority of the staff cuts will be at the Hayward plant, which has failed repeated inspections by the FDA since 2011 and was recently issued with a Form 483 citing 12 observations, including three repeat offences.
The problems at the facility have been a factor in the delay of new approvals at the generic pharma company, including most significantly registration of Rytary (carbidopa and levodopa), a new extended-release formulation of the widely-used Parkinson’s disease treatment.
Rytary was licensed to GlaxoSmithKline outside the US and Taiwan in 2010, but GSK handed back rights to the product in April after the FDA issued a complete response letter (CRL) in January indicating it could only be approved after a satisfactory re-inspection of the Hayward facility.
“This reduction in our workforce was a difficult decision, but necessary to position Impax for a brighter future,” commented Larry Hsu, Impax’ chief executive.
The company expects to save $15 million a year from the staff reductions, which will also see its salesforce reduced from 84 to 64 positions with a saving of $2 million, as well as $10 million from reduced cost of goods sold in 2013. It will take a charge of $2.4 million this year as a result of the cost-cutting exercise.
“To succeed, we must decrease our costs while efficiently advancing our strategic growth priorities in both our generic and brand businesses,” said Hsu.
Previously the company had said that the cost of remediation efforts would be between $10 million and $15 million in 2013, and that it would also discontinue several low-margin products accounting for around 3% of Impax’s annual sales, which were $582 million last year.
Impax is also gearing up for an expected reduction in sales of its authorised generic version of AstraZeneca’s migraine treatment Zomig (zolmitriptan) following its patent expiry in the US on 14 May.
Phil Taylor
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