The company stated the plan realigns its business strategy, focusing on its core competencies of formulation development of controlled-release pharmaceuticals and distribution, and divesting or seeking other strategic alternatives for its brand pharmaceutical business.
Andrx has engaged Banc of America Securities to solicit offers for its brand business, which is primarily a sales and marketing organization with a limited number of products.
Andrx has also notified Pfizer that it is exercising its right to terminate their November 2003 supply and distribution agreement for Cardura XL, as a result of the FDA’s failure to approve the new drug application (NDA) for that product by December 31, 2004. Pursuant to the terms of the agreement, Andrx is entitled to a refund of the $10 million it paid in connection with the execution of the agreement.
Thomas Rice, Andrx’s CEO, said, “Our board and management have been evaluating our overall strategy, and have concluded that Andrx should focus on our core competencies of controlled release pharmaceuticals and distribution, as well as initiatives, such as our agreement with Takeda Pharmaceuticals, that will cause our controlled-release technologies to be employed in the development of new brand products for third parties.”
Andrx’s brand products business segment incurred losses from operations of approximately $31 million for the first nine months of 2004. Andrx said it anticipates that its brand business will continue to incur operating losses until the disposition of that business is complete.