Avon Restructuring Impacts 2,300 Jobs

Avon Products Inc. highlights the initial restructuring actions under the new 2009 program it announced in February to continue driving the long-term transformation of its cost structure and to increase efficiency and organization effectiveness across its global operations.

Charles Cramb, Avon's vice chairman, chief finance and strategy officer, says, "When fully implemented, the initiatives approved to date reflect almost half the costs to implement the 2009 restructuring program, and are expected to generate approximately 60 percent of the targeted annualized savings. As a result, we are on track to achieve our stated goal of approximately $200 million in total annualized savings by 2012-2013, with costs to implement all initiatives expected to be in the range of $300-$400 million."

The restructuring initiatives will include realignments in its global supply chain manufacturing footprint and improvements in operating model effectiveness in key geographies. As a result, approximately 2,300 positions will be impacted globally, with a net reduction of approximately 1,200 positions when the initiatives are fully implemented by 2012-2013.

The second-quarter 2009 charge will include costs-to-implement realignments of supply chain manufacturing operations, primarily in North America, Western Europe, and Central and Eastern Europe.

In North America, the company said that it will close its facility in Springdale, Ohio by mid-2012. In Western Europe, Avon is planning to close its manufacturing facility in Neufahrn, Germany, and it has entered into the required formal information and consultation processes with the economic committee and works council in Germany. In Russia, the company is planning to improve processes, reconfigure equipment and streamline operations at its facility in Naro Forminsk in order to meet increasing demand more cost-effectively.

Kirin and Suntory Merger makes World Largest Beverage Company

Pinnacle Foods names Robert Gamgort CEO, replacing Jeff Ansell

Pinnacle Foods Group announced that its CEO is leaving the company and the board has appointed a former executive at snack food company Mars Inc. in his place.

Robert Gamgort, 46 , who worked most recently as North American President for Mars will assume the new role immediately.

He replaces Jeffrey Ansell, 50 who is leaving Pinnacle to pursue other interests, according to the company.

The New Jersey-based food company also said that Roger Deromedi, who serves as chairman of the company's board of directors, will become non-executive chairman.

Pinnacle Foods is a portfolio company of investment firm The Blackstone Group. Shares of Blackstone rose 36 cents, or 4.1 percent, to $9.09 in late trading Monday.

Johnson & Johnson completes Cougar Biotech deal

Johnson & Johnson said Friday it completed its $893.7 million acquisition of Cougar Biotechnology Inc., a development stage company that is testing a potential treatment for prostate cancer.

Johnson & Johnson said about 20.1 million shares of Cougar were tendered in favor of its buyout offer, which represented 95.9 percent of the company's outstanding common stock.

Johnson & Johnson agreed to buy Cougar in May for $43 per share. Antitrust regulators signed off on the deal in June.

Los Angeles-based Cougar is conducting two late stage clinical trials of abiraterone acetate as a treatment for prostate cancer. It is also testing the drug against breast cancer, and has four other potential cancer drugs in various stages of clinical and preclinical development.

Cougar is now a wholly owned subsidiary of Johnson & Johnson, and will work with the Ortho Biotech Oncology Research and Development unit.

Johnson & Johnson shares rose 20 cents to close at $56.89 Friday.

House Approves $2.99 Billion FDA Budget

The House on Thursday overwhelmingly approved a $373 million budget increase for the Food and Drug Administration, the largest boost in the agency's history.

The House voted 266 to 160 to give the FDA a $2.99 billion budget for fiscal year 2010.

The toughest exchanges in two days of debate over the FDA budget were between Reps. Paul Broun (R., Ga.), and Rosa DeLauro (D., Conn.). Rep. Broun introduced an amendment that would have the FDA receive the same level of funding as 2009, saying it would save Americans money.

"We're stealing our grandchildren's future by spending so much money," he said, adding that he isn't picking on the FDA.

Rep. DeLauro, a long-time food-safety advocate, blasted that idea. "Your [proposal] in fact would put this agency back in jeopardy," she said. "We just cannot afford to neglect our food safety system any longer."

Much of the increase in funding will target food safety initiatives, an area where the FDA has faced numerous challenges in the last year amid concerns as to how the agency responded to a variety of food-borne health problems involving peanuts, pet food and hot peppers. Rep. DeLauro said it will allow the FDA to review more food that enters the country's borders and hire an additional 1,150 foreign and domestic inspections.

There were about 90 amendments added to the bill but the House rules committee allowed about 10 of the amendments to reach the floor. Republicans grumbled that so many amendments weren't included for debate. Most of the amendments related to the broader agricultural appropriations bill, which includes the FDA's budget.

The FDA budget has been passed by a Senate committee but has yet to be voted by the chamber.

The following are the specific funding levels for the FDA:

§  $783 million for the Center for Food Safety and Applied nutrition

§  $873 million for the Center for Drug Evaluation and Research

§  $349 million for the Center for Devices and Radiological Health

§  $305 million for the Center for Biologics Evaluation and Research

§  $156 million for the Center for Veterinary Medicine

P&G turns over virtually all Marketing Chiefs

A P&G spokeswoman said Mr. Glock, 46, is retiring from the company effective Sept. 30 and is on special assignment until then. His job duties are being split between Ms. Howell, 46, who has taken over the strategic and planning portions of Mr. Glock's role, and Mr. Atkinson, 52, a purchasing manager and now a global brand-building purchasing manager.

Mr. Glock, who couldn't immediately be reached for comment, handled both sides of those duties; he had a dual report to Global Brand-Building Officer Marc Pritchard and Rick Hughes, VP-global purchases. Ms. Howell reports to Mr. Pritchard, while Mr. Atkinson reports to Mr. Hughes and Mr. Pritchard.

His departure is the latest in a near complete turnover of senior functional chiefs in marketing-related areas over the past year, which has included departures of Global Marketing Officer Jim Stengel, Global External Relations Officer Charlotte Otto and VP-Design Innovation and Strategy Claudia Kotchka, as incoming CEO Bob McDonald has assembled his team.

In addition to media, Ms. Howell also is overseeing other areas of communications, including branded entertainment and sports marketing.

"So it's really about getting synergies among all of those areas," she said. Much of the staff in the shopper-marketing group she oversaw has been assigned to brand teams, the spokeswoman said.

Ms. Howell led global-marketing efforts on P&G's Walmart customer team for many years before becoming head of shopper marketing across all of P&G in 2005.

Kim Kraus, director-strategic relationship optimization, continues in her current role overseeing purchasing issues with creative agencies, but not areas of marketing services. She will report to Mr. Atkinson.

Dean Foods purchases Alpro soy business for $454 million

Dairy processor Dean Foods Co. closed the purchase of Belgium-based Vandemoortele NV's Alpro unit for about 325 million euros ($454.5 million).

The purchase is being financed with an existing revolving credit agreement.

Alpro makes branded soy-based beverage and food products, which include its Alpro soya and Provamel brands. The unit has approximately 750 employees and five plants in Belgium, the U.K., France and the Netherlands.

The acquisition is expected to modestly add to Dean Foods' 2009 earnings.

Shares of Dean Foods inched up 11 cents to $19.67 in midday trading.

J&J Pays $1.5 Billion for Elan Stake, Takes Aim at Alzheimer's

Johnson & Johnson on Thursday said it will buy an 18.4% stake in Irish biotech company Elan Corp., in a $1.5 billion bid to crack the elusive but potentially lucrative market for Alzheimer's disease treatments.

The agreement gives J&J access to bapineuzumab, a closely watched experimental Alzheimer's treatment that is in late-stage human studies but whose prospects remain uncertain.

There are few treatments for Alzheimer's, a degenerative brain disease that is poorly understood. Two late-stage trials of experimental treatments, Myriad Genetics Inc.'s Flurizan and Neurochem Inc.'s Alzhemed, have failed in the last two years.

The treatments on the market address the disease's symptoms but don't stop its progression. Analysts say the Alzheimer's market is currently worth more than $3 billion a year world-wide.

Among the treatments now on sale are Aricept, from Eisai Inc. and Pfizer Inc.; Namenda, from H. Lundbeck AS and Forest Laboratories Inc.; and J&J's Razadyne, which treats memory loss and other symptoms of mild to moderate Alzheimer's.

Drug-development efforts have been hampered by a lack of knowledge about Alzheimer's causes. Most research has focused on preventing or reducing a sticky substance called amyloid in patients' brains thought to be linked to the disease's progression. Another group of compounds in development target tau, a different protein thought to be culpable.

Despite the uncertainty, drug makers have been spending billions of dollars to develop new Alzheimer's compounds because the potential payoff is big.

In the U.S. alone, the National Institute on Aging says that as many as 4.5 million patients suffer from the illness, which gradually robs people of their memories. World-wide, 24 million people have Alzheimer's and other forms of dementia, according to the World Health Organization.

"If a drug like bapineuzumab can actually halt progression of Alzheimer's, this could be an extremely large market," with more than $25 billion in annual sales world-wide, said Linda Bannister, an Edward Jones analyst.

Bapineuzumab, which is one of the most advanced treatments in development, had mixed results in earlier trials and is considered a high-risk investment. The so-called therapeutic vaccine aims to fight the progression of Alzheimer's by using antibodies to remove amyloid.

"I have become more skeptical about bapineuzumab than I was, say, two years ago or three years ago, partly because we've learned a lot more about the dynamics, if you will, of amyloid in the brain," said P. Murali Doraiswamy, professor of biological psychiatry at Duke University Medical Center. He has been involved with clinical trials or served as a consultant for several companies working on Alzheimer's, including an ongoing affiliation with Elan.

Amyloid appears to turn over rapidly in the brain, so a treatment that clears it from the system might have only a temporary response, requiring additional or more frequent treatments, he said.

There also have been cases of brain swelling in some bapineuzumab-trial participants, prompting the companies to stop giving some patients in late-stage trials the highest of three dose levels of bapineuzumab.

J&J, of New Brunswick, N.J., initially will commit as much as $500 million to continue bapineuzumab's development. For an additional $1 billion, J&J will get the Elan stake and will transfer the rights to Elan's Alzheimer's program into a new company. Elan will get a 49.9% stake in the new company, with J&J owning the balance.

Dublin-based Elan and Wyeth, of Madison, N.J., have been developing several potential therapies to slow the progression of Alzheimer's, in a collaboration that Wyeth will continue with J&J and Elan. Wyeth, which is in the process of being acquired by New York-based Pfizer, will receive 50% of the profits resulting from the collaboration, with Elan receiving slightly less than a quarter and J&J slightly more.

Pfizer referred questions to Wyeth, which issued a statement calling the deal a validation of the collaboration's work. "We are looking forward to discussing this proposed transaction in detail with Elan and J&J, as we continue to focus on the development of bapineuzumab and other" experimental therapies, Wyeth added.

Analysts said they didn't expect Wyeth to challenge the deal because J&J's investment helps solidify Elan, which has needed cash to help fund clinical trials.

The proceeds will allow Elan to reduce its debt to $400 million from about $1.8 billion, Chief Financial Officer Shane Cooke said in a conference call with analysts.

Cadbury European chief exits

Cadbury European president Tamara Minick-Scokalo is leaving the confectionery company after just six months in the top job amid an overhaul of the confectioner’s senior European team.

European commercial operations director Ignasi Ricou is to step-up to take a wider role as a result of Minick-Scokalo’s departure and a wider management shake-up.

The restructure is the second top level overhaul in less than 12 months at the confectioner. Minick-Scokalo took over the top European post in January following a shake-up that also saw the departure of Britain, Ireland, Middle East and Africa president Matt Shattock and the axing of 250 global management jobs.

The company seems to have managed its business during the recession relatively well so far, given results posted mid-June which show a sales rise in the UK and the US during April and May, following a slow start to the year. Cadbury was unavailable for comment about the management shake-up.

The multinational, which counts Dairy Milk and Trident gum among its top brands, announced last year it was restructuring its business units and cutting jobs in a bid to strengthen its focus on category development.

Minick-Scokalo joined Cadbury as global commercial president in 2007 from cosmetics multinational Elizabeth Arden, where she was a senior vice-president. She has worked across marketing, research and development and manufacturing for multinationals including Coca-Cola and Procter & Gamble.

Ricou is a former general and marketing manager for Princes food brand owner Adams and joined Cadbury as central and southern Europe managing director in 2005.

UK marketing director Phil Rumbol is not affected by the changes.

Maxygen, Astellas seal research pact, CEO will exit

Maxygen teams up with Japan's Astellas on R&D

* CEO, CFO and COO will leave after joint venture set

Maxygen Inc , has agreed to set up a joint venture with Japan's Astellas Pharma Inc. to focus on researching protein pharmaceuticals, as the U.S. drug maker brings in a partner to defray the cost of its research programs.

Maxygen said on Tuesday its chief executive, chief financial officer and chief operating officer will depart the company after the venture is set up and established. Maxygen will own 83 percent of the venture initially, in a structure to be finalized in the third or fourth quarter of this year.

The partners will contribute $10 million in cash each to the newly formed venture, which will likely be led by Maxygen's chief business officer, Grant Yonehiro, Maxygen said in a statement.

Maxygen, which has reported persistent losses over past years, said in October it would lay off 30 percent of its workforce and delay certain programs as it searches for partners to share costs.

Under the terms of the venture agreement, Astellas will have the option to buy out Maxygen's stake within three years after the venture is set up.

If Astellas does not buy Maxygen's stake during the three-year window, it may choose to license one product from the venture. The remaining products will be jointly owned by both companies.

"Today's announcement largely completes a multiyear strategic process to position Maxygen's programs and assets in collaborations and other arrangements that are primarily supported by external parties," the executive chairman of the board, Isaac Stein, said in a statement on Tuesday.

"As a part of this process and following an appropriate transition period after the closing of the joint venture transaction, we also expect Maxygen's current senior management team -- Russell Howard, Larry Briscoe and Elliot Goldstein -- will be leaving the company."

The company plans to shift one of its major research programs, focusing on the treatment of autoimmune diseases such as rheumatoid arthritis and transplant rejection, to the joint venture, Maxygen said.

Shares in the Redwood City, California-based company closed down 4.4 percent at $6.72 on the Nasdaq.