As it comes close to completing its $8.7 billion acquisition of eye care major Bausch + Lomb, Valeant Pharmaceuticals International says that it expects to reduce headcount by 10%-15% across the combined company.
The new-look Valeant has a workforce of about 18,500-19,000 people, and the cuts will affect employees from both firms. In a memo to staff, Valeant chief executive Michael Pearson said severance plans for the USA and Canada have been finalised.
He noted that “in terms of integration planning, we are largely finished”, noting that the company is expecting over $800 million of cost synergies are expected in the next 18 months. Mr Pearson added that there will be no reductions in the B + L North American field force “or any material changes” to its sales organisations around the world.
Valeant’s corporate headquarters will remain in Laval, Quebec but is moving B + L’s base to New Jersey from Rochester, New York. It will continue to operate all current manufacturing locations in the USA, including Rochester, and the acquisition is expected to close next month.
Mr Pearson noted that “we recently reached a market capitalisation of over $30 billion and have delivered the highest shareholder return of any major company on the New York Stock Exchange since 2008”. He added that “we start on the next step of our journey – to become the most valuable healthcare company in the world”.
The Valeant boss said that “we will continue to operate a decentralised, highly efficient operating model” and in terms of research, the company “will spend significantly more efficiently than our peers in recognition of the fact that R&D investment has not provided a good return for most pharmaceutical companies over the last two decades. We will not assume we are smarter, better or luckier than others in our industry”, he concluded.
