Endo reports loss, announces layoffs, shake-up
Endo International, with U.S. headquarters in Malvern, reported a $133.9 million loss in the first quarter after the stock market closed Thursday, sending shares down 24 percent in after-market trading.
Endo International, with U.S. headquarters in Malvern, reported a $133.9 million loss in the first quarter after the stock market closed Thursday, sending shares down 24 percent in after-market trading.
Endo said will restructure its generic medicines manufacturing business, and cut 740 employees in Charlotte, N.C. and Huntsville, Ala.
Endo employs 350 in Malvern and 6,000 worldwide. The reductions will not impact Malvern, a company spokeswoman said.
Endo reported revenue of $963.5 million, which fell short of analysts' $964.4 million estimate.
On a conference call, analysts asked management why the don't consider a merger with, or acquisition by, another company to increase shareholder value.
Endo shares closed at $26.59, well below its 52-week high of more than $80.
Endo said its Voltaren Gel revenue fell 21 percent due to loss of patent exclusivity and generic competition.
The company's pain medicines faced headwinds due to public policy pressure on opioid physician prescribing and reimbursement restrictions for its Lidoderm pain patch, and "slower than expected uptake" on the launch of Belbuca due to pressure on opioid prescribing, the company said. Belbuca was approved by regulators in October for severe pain requiring daily, around-the-clock opioid treatment.
Endo's products are both branded drugs with market exclusivity through patent protection and generic drugs.
Endo, which has set aside money for litigation related to vaginal-mesh implants, revised financial guidance downward for 2016.
The company announced that Brian Lortie, president of U.S. Branded pharmaceuticals, will step down when a successor is named.
"Despite increasing competitive and pricing pressures across both our generics and branded businesses, Endo was able to deliver first quarter results largely in line with our expectations," said Rajiv De Silva, Endo president and CEO. "However, as we move further into 2016, we are rebasing our full-year financial expectations due to the impact of several previously unanticipated headwinds: new competitive entrants including for Voltaren Gel; greater than expected price erosion across the generics sector; and delays on regulatory actions related to certain Endo products."
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