EAST BRUNSWICK, N.J. (AP) -- Gout drug maker Savient Pharmaceuticals Inc. named a new president and CEO on Monday, and said it will eliminate 35 percent of its workforce, or about 60 jobs.
The company said Louis Ferrari, the head of its North American commercial operations, will become president and CEO of the company. Ferrari will also join Savient's board of directors. He has worked for the company since February 2011.
Former interim CEO David Norton will remain on the board of directors, Savient said. Norton replaced John H. Johnson, who left the company in February to become president and CEO of prostate cancer drug maker Dendreon Corp.
Savient said it will eliminate 35 percent of its work force, including vacancies, in a move effective Sept. 10. The company had 173 employees as of Feb. 22, meaning it will cut about 60 jobs. The company said it expects to save $56 million per year starting in 2013, and the job cuts will save it $6.5 million in 2012. Savient expects to take a total of $4.7 million in restructuring and severance charges associated with the job cuts, with most of those charges coming in 2012.
Savient started selling the gout drug Krystexxa in late 2010. Sales have been disappointing, as Savient reported $3.1 million in net revenue from the drug in the first quarter. Shares have also plunged recently after investment firm Tang Capital Management said the company is insolvent. Savient has lost more than $70 million in each of the last four years, including $102 million in 2011. The company said Tang's complaints lacked merit.
Shares of Savient Pharmaceuticals fell 5 cents, or 8 percent, to 56 cents in afternoon trading. They traded as low as 50 cents per share last week, and peaked over the past 52 weeks at $8.03 last July.