posted by Phill Allen
April, 07th, 2014
Company News Pharmaceutical Industry News
Baxter International has announced plans to split itself into two separate healthcare companies with one focusing on biopharmaceuticals and the other on medical products.
Chairman and chief executive officer, Robert L Parkinson Jr, said the move would boost innovation and reward shareholders.
“Baxter has an established history of executing successful spinoffs, and we have continued to evaluate the separation of these two businesses in response to diverging business dynamics and the rapidly changing macro environment,” explained Mr Parkinson.
“This decision underscores Baxter’s commitment to ensuring its long term strategic priorities
remain aligned with shareholders’ best interests, while improving our competitive position and performance, enhancing operational, commercial and scientific effectiveness and creating value for patients, healthcare providers, and other key stakeholders.”
The two businesses operate in “distinct” markets
The company, which primarily focuses on products to treat haemophilia, kidney disease, immune and other chronic disorders, is confident that the separation will result in an array of material benefits to the standalone companies.
- Greater management focus on the distinct businesses of biopharmaceuticals and medical products
- Ability to more effectively commercialise new and existing product offerings
- Ability to drive innovation across the franchises and allocate necessary resources to the areas presenting the highest growth potential
- Flexibility to pursue respective growth and investment strategies resulting in revenue acceleration, improved profitability and enhanced returns
Robert L. Parkinson Jr is set to preside as chairman and chief executive officer of the medical products company. This one will retain the Baxter International name. Ludwig N. Hantson will be handed the post of chief executive officer at the new biopharmaceuticals company.
Both companies’ corporate headquarters will reside in Northern Illinois.
Ludwig N. Hantson, who currently serves as president of BioScience, said the split represented a “significant milestone that will result in material benefits for key stakeholders”.
“We are confident that this decision not only strengthens our outlook, it positions us well to execute on our future growth prospects, new product pipeline and other opportunities as we enter a new era in the journey to achieve our aspiration as a premier biopharmaceuticals company.”
The medical products business generated revenue of more than $9 billion in 2013. News of the impending move saw Baxter’s shares jump 4.9% to $73.51.
An in and outside the (bioprocess) box thinker, fluid management specialist Phill knows a thing or two about keeping pharma liquid logistics flowing.