United Drug is a big winner in Big Pharma's bid to cut costs by outsourcing more of its supply chain work. The contract manufacturer's packaging division nailed down a nearly $40 million, four-year contract from an unnamed pharmaceutical company, CEO Liam FitzGerald announced at the company's Feb. 7 annual meeting in Dublin.
FitzGerald declined to discuss details about the deal or even the name of the "leading pharmaceutical company," according to The Irish Times article covering the news. But what's interesting is that the contract comes from an existing customer, and United Drug is hoping to gain even more business from the unnamed company longer-term, according to FitzGerald. (Let the speculation begin about who the client actually is.)
United Drug could use more contracts like this. The company announced in August that it had planned to restructure and slash 150 jobs at a plant in Ireland in an effort to streamline operations in the face of government cuts in healthcare spending and the resulting lower sales.
But the company was more optimistic at its annual meeting, The Irish Times story notes. Executives announced that United Drug's packaging business is ahead so far in both revenue and profits compared with 2011, and that its earnings per share would likely jump 4% to 8% in the fiscal year that ends Sept. 30. The company said its overall revenue and profits for the first quarter that ended Dec. 31 are ahead of a year earlier, with much of the growth coming from businesses outside of Ireland.
- here's The Irish Times story