Orange County’s top 10 drugmakers lost jobs during the past 12 months, primarily because of the acquisition and reorganization of longtime market leader Allergan PLC, previously Allergan Inc.
This week’s Business Journal list shows top drugmakers accounted for 3,413 OC jobs in the period ended in mid-August, down 10% from last year’s 3,795 jobs.
Three of the companies added jobs, and two reported declines. The remaining five figures are Business Journal estimates, which can’t be compared.
• Perennial No. 1, Allergan, which now has its headquarters in Ireland for tax purposes and primarily operates from Parsippany, N.J., cut jobs by 15% during the period to 2,085.
The downsizing, which came mainly in three waves between June 2014 and last October, followed a long-running struggle between Allergan and a pair of hostile suitors—Canada-based Valeant Pharmaceuticals International Inc., the list’s No. 10 drugmaker—and activist investor Bill Ackman’s Pershing Square Capital Management LP.
Allergan’s battle ended in November when it agreed to accept a friendly $73 billion deal with Ireland-based Actavis PLC that was finalized in March. The combined company took the Allergan name in June.
Irvine is retaining a major role in the new Allergan, Chief Executive Brent Saunders told the Business Journal in June when he participated in an ophthalmology summit sponsored by Aliso Viejo-based networking group Octane.
“I suspect over time it will be a growth site in terms of employment and opportunities for employment,” Saunders said.
He said he anticipates growth for Allergan in Irvine on the research and development and commercial sides.
“We’re going to continue to invest in internal R&D, as well as buy other assets to bring” in R&D.
Saunders also said Allergan’s legacy eye care business is an important player in the new company.
“It is the heritage of Allergan. I think it’s an incredibly bright and growth category for our company.”
n Israel-based Teva Pharmaceutical Industries Ltd., a maker of generic drugs, comes in at No. 2 despite a 25% cut that left it with 290 local workers. It has been slowly winding down its presence in Irvine over the past few years, including chunks of layoffs between 2011 and 2013. It arrived in OC in 2003 when it purchased Sicor Inc., another generic drug company.
“… We have previously announced our intention to sell this facility and continue to look for a potential buyer,” Teva spokesperson Denise Bradley said in an email.
• No. 3, Dendreon Corp., has an estimated 250 workers at its manufacturing plant in Seal Beach. The maker of the Provenge vaccine for advanced prostate cancer filed for bankruptcy in November and has been scaling back its operations.
• The No. 4 drugmaker, Tustin-based Peregrine Pharmaceuticals Inc., reported 239 workers, up 29% from a year earlier. It’s developing drugs to treat cancer, including its lead compound, bavituximab. The company also has a subsidiary known as Avid Biosciences, which is a contract manufacturer of drugs.
• Par Pharmaceuticals Inc. ranks No. 5 with an estimated 200 workers in Irvine.
• No. 6, Aliso Viejo-based Avanir Pharmaceuticals Inc., which agreed to be acquired by Japan-based Otsuka Phar-
maceutical Co. for $3.5 billion in December, posted the largest job gain, with a 37% hike to 138 workers. It makes Nuedexta, which is used to treat pseudobulbar affect, a neurological disorder, and has a deal with Whitehouse Station, N.J.-based Merck & Co. to co-promote a trio of Merck drugs for Type 2 diabetes in nursing homes.
• Avanir is followed by No. 7, Spectrum Pharmaceuticals Inc., which was once based in Irvine. Spectrum reported 89 workers here, up 6% from a year ago.
It has come under fire from activist shareholder Armistice Capital, a New York-based hedge fund that recently reduced its ownership position to 1.5% of the drugmaker. Armistice has alleged that Spectrum hasn’t lived up to its potential. It has, among other things, called for the company to move its headquarters back to Irvine from Henderson, Nev.
The list is rounded out by three drug companies whose employee numbers are Business Journal estimates:
• Stason Pharmaceuticals Inc. is the No. 8 drugmaker with an estimated 80 workers in Irvine.
• Mallinckrodt PLC, which is based in Dublin, Ireland, and operates from suburban St. Louis, was No. 9 with an estimated 27 local employees. It bought Anaheim-based Questcor Pharmaceuticals Inc. last year.
And Valeant employs an estimated 15 in Irvine. It was based in Aliso Viejo before it combined with Canada-based Biovail Corp. in 2010.
