Swedish-US drugmaker Pharmacia & Upjohn has reported that itsrestructuring and turnaround program (Marketletters passim) will result in charges of $450 million in the third and fourth quarters, of which $225 million will be in cash. Bob Salisbury, chief financial officer, said that the company didn't expect further charges until 2001 or 2002, something of a relief since previous costs incurred since 1996 totaled $585 million.
P&U said that its restructuring program, which includes hiring 1,200 new sales representatives (over 600 in the USA), will generate annual cost savings "which will be modestly accretive" in 1998, rising to $250 million in 2000.
Sales for the third quarter ended September 30, 1997, fell 9.8% over the same period in 1996 to just over $1.5 billion, due to the impact of generic competition on its older products and the strength of the dollar against most European currencies. Excluding non-recurring items, net earnings fell from $231 million, or $0.44 per share, in the third quarter 1996, to $184 million, or $0.35 per share.
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