Allergan

Allergan CEO Brent Saunders speaks during a press conference in 2016, when the company unveiled expansion plans for its Waco plant that have not materialized.

Staff photo — Jerry Larson

Pharmaceutical giant Allergan will slash its workforce internationally by 1,000 and eliminate 400 unfilled positions as it adjusts to losing exclusive rights to Restasis, a dry-eye treatment made in Waco and its second-highest revenue generator behind only wrinkle concealer Botox.

But maneuvering by the company based in Dublin, Ireland, will not eliminate jobs at Waco’s facility on Mars Drive, spokesman Mark Marmur said. The Waco plant was scheduled for a 322,000-square-foot, $200 million expansion that would increase employment by about 250 over several years.

“To be clear, Allergan is not reducing workforce in Waco as a result of our restructuring plan announced on January 3,” Marmur said via email. “Waco is an important manufacturing site for Allergan with many highly skilled and valued colleagues on site. Production volumes for the year are strong, and we are celebrating 29 years in Waco in 2018.”

Marmur said Allergan remains committed to its eye care business and to local operations.

“We are investing significantly in Waco with new production lines, and these are scheduled to come online in 2018,” he wrote.

Marmur said Allergan also hopes to produce newly formulated medications in Waco starting this year and next, but he declined to elaborate on the nature of those treatments.

Other products besides Restasis expected to see new or increased generic competition this year include Namenda XR, an Alzheimer’s treatment; Delzicol, for ulcerative colitis; Aczone, an acne drug; and Estrace, a hormone to treat menopause symptoms, according to a company press release.

Besides Restasis, the Waco facility produces Lumigan and Combigan, both of which are used in the treatment of glaucoma, as well as Refresh Plus and Refresh Tears, used to provide relief for dry and irritated eyes.

The Waco operation employs about 700 people, a number that had been scheduled to increase as Allergan proceeded with plans to nearly double the size of the facility.

It had predicted construction would start before the end of 2016, but progress apparently has been limited to site preparation.

Bobby Horner, who oversees the city of Waco’s inspection services department, said last week the company has not submitted a detailed site plan or secured a building permit.

“I’m not really sure what the hold-up is,” Horner said, noting Allergan’s announcement in spring 2016.

During a news conference attended by local and state elected officials, as well as local business leaders, Baylor University economist Tom Kelly released a report showing the company’s planned $200 million expansion would give the Central Texas economy a $522 million jolt during the first year of construction, applying a multiplier that factors the impact of spending as it travels through the economy.

Once the expansion is complete, probably in 2020 or 2021, according to Kelly’s original estimates, operation of the expanded plant would have a $461 million annual impact on the area.

Marmur has declined to provide further details about the expansion or an updated timeline.

Allergan had hoped to protect Restasis from generic competition by transferring patents to the Saint Regis Mohawk Tribe. But the move backfired when a federal judge struck it down, ending the company’s hopes of protection from review by the U.S. patent office, according to online reports, including one by thestreet.com, an investment site.

Meanwhile, CEO Brent Saunders said Allergan’s eye care business, even without the exclusivity of Restasis, would generate about $2 billion in annual revenues, thestreet.com reported.

Staffing cuts reportedly will save the company between $300 million and $400 million, according to an Securities and Exchange Commission filing announcing the plan. The cuts will cost about $125 million upfront in severance packages and restructuring fees.

Kelly noted that a merger deal between Allergan and Pfizer was pending in mid-2016, when Allergan announced its grand plans for Waco. The two sides called off the $160 billion transaction amid criticism that Pfizer planned to move its headquarters from the U.S. to Ireland, a move that could have reduced the tax burden of the combined company.

Recommended for you