Eagle Pharmaceuticals (EGRX) to reduce current workforce by approximately 36%

Eagle Pharmaceuticals (NASDAQ: EGRX) disclosed:

On February 28, 2024, the Board of Directors of Eagle Pharmaceuticals, Inc. (the “Company”) approved a plan designed to improve operational efficiencies and realign the Company’s sales and marketing expenditures (the “Realignment Plan”).

The Realignment Plan is expected to reduce the Company’s current workforce by approximately 36%. Substantially all affected employees are currently dedicated to or primarily supporting the commercialization of Byfavo, Barhemsys and Ryanodex. The Company intends to utilize a reduced team dedicated to these products in addition to resources from the Company’s oncology sales team to continue the commercialization of Byfavo, Barhemsys and Ryanodex. Affected employees will be offered separation benefits, including severance payments and healthcare coverage assistance, and certain remaining employees may receive retention awards. The Company is initiating implementation of the Realignment Plan effective immediately.

The final costs, charges and expenditures relating to the Realignment Plan will not be known until all related activities have been completed. The Company estimates that it will incur approximately $3.5 million in cash charges in connection with the Realignment Plan, consisting of (i) approximately $3.1 million in cash-based expenses related to employee severance payments and healthcare coverage assistance and related costs and (ii) approximately $0.4 million in retention cash-based benefits.

The Company expects that the majority of the above estimated charges related to the Realignment Plan will be recorded in the first quarter of 2024 and that the execution of the Realignment Plan will be substantially complete during the first quarter of 2024, with related cash-payments substantially complete by the end of fiscal year 2024. In addition, in connection with the preparation of the Company’s 2023 financial statements, the Company is performing an impairment analysis over certain long-lived assets and inventory, which may result in the Company recording non-cash impairment charges.

The estimates of the costs, charges and expenditures that the Company expects to incur in connection with the Realignment Plan, and the timing thereof, are preliminary estimates based on the Company’s current expectations and are subject to a number of assumptions, and actual amounts and results may differ materially from such estimates. In addition, the Company may incur other costs, charges, expenditures, impairments and other impacts not currently contemplated due to unanticipated events that may occur, including in connection with the implementation of the Realignment Plan.

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