Elan announces alignment of resources
Elan Corporation announced on February 25, 2009 that as part of its ongoing efforts to manage its overall cost base and direct additional investment toward its late stage pipeline, it will refine its business operations and functions to realise greater efficiencies and strengthen its focus to key and strategic areas. Elan will continue to have two related but distinct operating divisions: Biopharmaceuticals and Elan Drug Technologies. Specific adjustments include a postponement of biologics manufacturing activities, a strategic redesign and realignment of the R&D organisation within the Biopharmaceutical business, and a reduction in related G&A and other support activities. These changes follow the realignment of components of Elan’s commercial organisation announced in late 2008.
These adjustments, largely driven by changes in the Biopharmaceuticals business, will result in a reduction in Elan’s global workforce of approximately 230 positions, or 14% of Elan’s workforce. In Ireland, where Elan’s biological manufacturing and related fill finish activities are based, approximately 115 positions will be impacted. A further approximately 115 positions will be affected in the United States, mainly in the areas of research, clinical development, biopharmaceutical development, and related corporate support and administrative services. Elan expects to reassess the opportunity to invest in a biologics manufacturing facility and restart its related fill finish activities after the company has had the opportunity to evaluate the data from the Phase 3 trials of bapineuzumab in Alzheimer’s disease.
Elan expects that the financial benefits of these adjustments, some of which will be re-invested in the advancement of the clinical development of its pipeline, will reduce operating expenses in 2009 by $30-$35 million and by approximately $50 million in a full year. Severance and related charges are expected to be $15 million and will be recorded as a charge in the first half of 2009.
Source: Elan Corporation