Auxilium Pharmaceuticals said Tuesday it is cutting 30 percent of its workforce, about 190 jobs, as part of a restructuring of its operations that will save it at least $75 million a year.
The moves come as the company struggles with sales of its testosterone replacement gel Testim, which is in a market Auxilium said in August was “increasingly crowded and challenging.”
Auxilium said revenue from Testim fell 52 percent in the second quarter. Testim had been the company’s biggest-selling product.
Shares of Auxilium Pharmaceuticals Inc. were unchanged at $20.38 in aftermarket trading following the announcement. The stock traded as high as $32.89 in early March.
The Chesterbrook, Pennsylvania, company said it will streamline its commercial organization, creating two sales forces to replace the current three. Auxilium said the moves will strengthen its urology drug franchise, and support key products like its testosterone pellet Testopel, its impotence drugs Stendra and Edex, and Xiaflex. The company also said it will focus its drug research efforts on products that are likely to return value in the near future.
Xiaflex was first approved as a treatment for Dupuytren’s contracture, which makes the tendons of the hand thicken and shorten, causing the fingers to curve inward. In December, the Food and Drug Administration approved the drug as a treatment for Peyronie’s disease, which causes abnormal curvature of the penis.
Auxilium had 635 employees as of June 30. The company said it expects to take up to $20 million in restructuring charges related to the moves.
Auxilium said in June that it would combine with Canadian eye drug maker QLT in an all-stock deal worth about $345 million. The deal is scheduled to close in the fourth quarter, and is intended to help Auxilium cut its tax rate and diversify its product offerings.
Date: September 9, 2014
Source: Associated Press