Thousands of layoffs on the horizon for Mylan
- In news that slipped out quietly in a filing with the U.S. Securities and Exchange Commission, Mylan has announced restructuring plans. While details are limited, this will affect "certain locations", with an aim to "streamline its operations globally."
- Mylan has stated that it anticipates the changes will affect fewer than 10% of the workforce across all locations. As of its latest quarterly SEC filing, the company had 35,000 employees worldwide, suggesting as many as 3,500 employees could be cut.
- The company will release further details as the initiatives are finalized. This will include estimates of costs and details of numbers affected. At close of trading on Wednesday, Mylan shares had dropped by almost 4%.
Mylan has been mired in scandal this year, with an over 400% price hike for its epinephrine auto-injector, EpiPen, since 2012. The company has faced criticism, culminating in grilling by congress and calls for investigations over Medicaid rebates by the attorney general.
Mylan explains these changes as a restructuring based on acquisitions. However, last month Mylan reported a third quarter loss of around $120 million, compared with a previous profit of $429 million. This loss was fueled by a $465 million settlement as a result of overcharging U.S. Medicaid patients, and is likely to have had an impact on the newly-announced decision.
"Since 2015, the Company has made a number of significant acquisitions, and as part of the holistic, global integration of these acquisitions, the Company is focused on how to best optimize and maximize all of its assets across the organization and across all geographies," said the company in the filing.
Mylan is also facing competition for EpiPen, although each of its competitors face challenges. Biotech Kaleo's lower-cost Auvi-Q has a potential launch in early 2017. However, this device was previously withdrawn from the market by Kaleo's ex-partner, Sanofi, following safety issues. Adamis Pharmaceuticals' lead product is an epinephrine pre-filled syringe. This was originally submitted for approval in the U.S. in 2014, but has been rejected by the FDA twice. Following a complete response letter in June 2016 for its latest submission, Adamis is planning resubmission of a modified application.
- Mylan SEC Form 8-K
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