Inverness Medical Innovations to Close Cholestech, HemoSense and BioStar Facilities
The Cholestech operation, which was acquired by Inverness in September2007 and manufactures and distributes the Cholestech LDX system, a point-of-care monitor of blood cholesterol and related lipids used to test patients atrisk of, or suffering from, heart disease and related conditions will move toInverness Biosite facility in San Diego, California. The HemoSense operation,which was acquired in November 2007 and manufactures and distributes theINRatio System, an easy-to-use, hand-held blood coagulation monitoring systemfor use by patients and healthcare professionals in the management ofwarfarin, a commonly prescribed medication used to prevent blood clots, isalso expected to move to the Biosite facility in San Diego.
The transfers will take place in phases over the next 12-18 months andInverness expects to begin to see manufacturing savings of approximately $10.0million annually and general and administrative expense savings of $5.0million annually beginning in the second half of 2009. Aggregaterestructuring charges of approximately $12.0 million are currently anticipatedfor all costs including but not limited to write down of equipment andleasehold improvements, severance cost and rent obligations and these costswill principally be included as a component of the costs of the acquisitionsof Cholestech and HemoSense.
In connection with Inverness' decision to exit the BioStar OIA productline, Inverness will also close its manufacturing facility in Louisville,Colorado around the end of the second quarter of 2008 with OIA productsavailable for purchase through the end of the first quarter of 2009.Inverness expects general and administrative savings of approximately $3million per year beginning in the second half of 2008 as a result of theclosure. Aggregate restructuring charges of approximately $9.5 millionincluding $5.6 million of writeoffs of intangible assets are currentlyanticipated for all costs including but not limited to write down of equipmentand leasehold improvements, severance cost and rent obligations and these berecorded during the first half of 2008.
The Cholestech and HemoSense and BioStar operations currently employapproximately 180, 95 and 70 people, respectively. Some reductions in staffinglevels for Cholestech and HemoSense are expected to be achieved as theseoperations are consolidated with existing operations in San Diego over thenext 18 months, and the closure of the BioStar plant is expected to result inthe elimination of approximately 56 positions. Field sales staff and certainback office functions from all three operations are already being consolidatedas part of Inverness' previously announced formation of a centralized NorthAmerican shared services center in Orlando, Florida.
By developing new capabilities in near-patient diagnosis, monitoring andhealth management, Inverness Medical Innovations enables individuals to takecharge of improving their health and quality of life. A global leader inrapid point-of-care diagnostics, Inverness' products, as well as its newproduct development efforts, focus on infectious disease, cardiology,oncology, drugs of abuse and women's health. Inverness is headquartered inWaltham, Massachusetts.
For more information about Inverness Medical Innovations, please visit ourwebsite at http://www.invernes
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