Lannett Comments On Integration Plans, Cost Reduction Initiatives

PHILADELPHIA, Dec. 21, 2015 /PRNewswire/ -- Lannett Company, Inc. (NYSE: LCI) today announced that, following a review of its operations including the recently acquired Kremers Urban Pharmaceuticals Inc. (KU), it expects to achieve approximately $40 million of cost reductions during the first 12 months following the close of the acquisition, with additional savings in later years. 

"We are confident that the KU acquisition will create significant value for our shareholders over time," said Arthur Bedrosian, chief executive officer of Lannett. "We are moving quickly to reduce overhead and streamline our organization, having identified cost reduction measures that will be implemented far sooner and are greater in total than our initial estimates. Last week, we announced the closing of the KU corporate headquarters in Princeton, New Jersey. Our plans also include the elimination of duplicative administrative functions, rationalization of our product development program and optimization of our manufacturing, distribution and research and development operations. Combined, we expect these actions to generate substantial savings over the near and longer term."

As Lannett previously disclosed, a key customer of KU recently took steps to transition its purchases of certain KU product lines. For the twelve months ended June 30, 2015, these product lines represented approximately $87 million in revenues and $45 million of EBITDA. Lannett management has since met with certain customers and received commitments that replace a portion of the lost revenues and EBITDA. Management plans to meet with other customers in an effort to recover even more business.

The company expects to provide updated fiscal 2016 full-year guidance for the combined company in January 2016 and intends to discuss its integration plans and cost reductions in a special conference call today 4:30 p.m. ET. The conference call will be available to interested parties by dialing 866-297-6395 from the U.S. or Canada, or 847-944-7317 from international locations, passcode 41455138. The call will be broadcast via the Internet at www.lannett.com. Listeners are encouraged to visit the website at least 10 minutes prior to the start of the scheduled presentation to register, download and install any necessary audio software. A playback of the call will be archived and accessible on the same website for at least three months.

About Lannett Company, Inc.:

Lannett Company, founded in 1942, develops, manufactures, packages, markets and distributes generic pharmaceutical products for a wide range of medical indications. For more information, visit the company's website at www.lannett.com.

This news release contains certain statements of a forward-looking nature relating to future events or future business performance. Any such statement, including, but not limited to, statements regarding Lannett's ability to achieve anticipated synergies and cost savings, and within the timeframe described, whether expressed or implied, is subject to market and other conditions, and subject to risks and uncertainties which can cause actual results to differ materially from those currently anticipated due to a number of factors which include, but are not limited to, the risk factors discussed in Lannett's annual report on Form 10-K and other documents filed with the SEC from time to time. These forward-looking statements represent Lannett's judgment as of the date of this news release. Lannett disclaims any intent or obligation to update these forward-looking statements even if new information becomes available, as a result of future events or for any other reason. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.

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SOURCE Lannett Company, Inc.

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