(Bloomberg) — Gulf Pharmaceutical Industries is looking to hire a restructuring adviser after cutting jobs as a ban on the medicine maker’s exports to Saudi Arabia weighs on its finances.
The company known as Julphar replaced most of its top management and appointed new board members as it comes under increasing financial strain. The United Arab Emirates-based firm also cut about 150 jobs, or 3% of its workforce, according to a person with knowledge of the plans who asked not to be identified because they are private.
A small proportion of staff were affected by a “modest restructuring” and all key positions have been filled, according to Chief Executive Officer Jerome Carle. The company will soon announce its new executive team and is working with consultancy firms to help optimize the business, he said.
“We are currently in the process of undertaking a voluntary reorganization of the company,” Carle said in an emailed response to questions. “Julphar’s leadership team has been conducting a comprehensive review of all areas of our business to identify cost savings.”
Julphar, which has about 801 million dirhams ($218 million) of debt, is under growing pressure after Saudi Arabia’s Food and Drug Authority in September banned its products for failing to meet regional standards. Julphar is working with the agency to get the ban lifted and posted a full-year net loss, as well as a slump in revenue in 2018.
“While now largely behind us, the impact of the suspension in Saudi Arabia will continue in 2019,” Carle said. “Challenges still lie ahead but we are taking steps to strengthen our financial health as part of a new far reaching strategy that will see us increasing our effectiveness and efficiency.”
Julphar, one of the Middle East and Africa’s largest pharmaceutical companies, also recalled about half a dozen products, including cough syrup and mouthwash, to address concerns raised by health authorities. It’s also faced political turmoil and currency devaluations in some of its markets.
Based in the emirate of Ras Al Khaimah, Julphar produces medical drugs and supplies. Its biggest shareholder is the government of Ras Al Khaimah, one of seven members that make up the U.A.E. The company is one of the biggest contributors to the emirate’s domestic economy.
–With assistance from Layan Odeh