Minimally invasive medical device specialist Angiodynamics (Albany, NY) has announced its intention to cut as many as 100 of its workers, representing nearly 8% of its workforce of approximately 1330. The move is part of what the firm terms an "operational excellence program" that could save the company between $15 –18 million over a three-year period, according to its calculations. The restructuring will be supplemented with lean initiatives, supply-chain optimization, and enterprise resource planning implementation, according to a statement released by the firm.
As is the case in many other recent layoffs in the medtech sector, the 2.3% medical device tax was faulted as one of the reasons behind the decision. In December of this year, the company had paid roughly $2.5 million towards the medical device tax. The company's CEO, however, admitted that the restructuring may have occurred anyway but did say that the tax pressure was increasing its focus on cost cutting efforts.
The company will consolidate its facilities in New York and centralize manufacturing in Glens Falls. A separate facility in Queensbury would be used for distribution. To expand the capacity of its Glens Falls–facility, the company will spend between $5 and $7 million, which according to the firm, will be "on top of approximately $2 million in one-off charges."
The restructuring announcement comes roughly two months after the company's upbeat announcement of its first quarter 2014 financial results, in which the firm's CEO, Joseph M. DeVivo said:
"[We are] very pleased with the progress that we're making as a company. We transitioned from a negative 2% growth last quarter to returning to growth here in the first quarter, net the supply agreement. I believe the contributors to our turnaround are: our U.S. sales force improvement and maturity, acceleration of our growth drivers that we've been talking about, as well as stability that we are gaining in our core business. I feel, as a business, in many ways, we've turned the corner."
