Generic drug maker Perrigo said it expected a $100-million boost to annual sales from a new factory inaugurated in Israel on Wednesday.
The U.S. pharmaceutical firm headquartered in Ireland invested about $46 million to expand its facility in the remote desert town of Yeruham, which specializes in products that are more difficult to produce than oral medications, such as foams, creams and nasal sprays.
“As a company this [investment] is a big prescription drug growth platform for us, primarily for the U.S. market, but not solely,” Perrigo President John Hendrickson told Reuters in an interview. “It allows us to stay on the cutting edge of being a leader of complex products.”
Perrigo began operating in Israel and listed on the Tel Aviv Stock Exchange when it bought pharmaceutical firm Agis Industries for $850 million in 2005.
Last year Perrigo fought off a $25-billion hostile takeover bid from rival Mylan, and Hendrickson said the company was not looking for any other buyers.
“We aren’t seeking anything like that. We feel we’ve got great stand-alone prospects,” he said.
With the Mylan saga behind it, he said the company was looking to buy back stock worth up to $1.5 billion over the next two to three years and planned to continue with its own acquisitions.
In the past several years, half of Perrigo’s growth has come from mergers and acquisitions and the other half from expanding its existing business. “We don’t see that kind of a mix changing going forward,” Hendrickson said.
Perrigo’s adjusted profit in the fourth quarter missed market estimates for the first time in more than a year, due to weaker than expected sales in its branded consumer health care business. Perrigo had revenue of $1.42 billion in the fourth quarter, just shy of the average estimate of $1.46 billion.
Its shares fell 13% on the TASE since then but were up 0.7% to 491 shekels ($126.09) late yesterday.
The shortfall was somewhat of a surprise, according to Hendrickson, who said the company remained in a strong position, due in part to its heavy investment in research and development.
“We’ve got a pretty fruitful pipeline. When you look out I think over the next two and a half, three years we have about $1.2 billion of new products in our pipeline,” Hendrickson said.