Valeo Pharma Inc. (TSX:VPH, OTCQB:VPHIF) said it has launched a restructuring of its field sales operations, taking cost-cutting to more than $7 million a year, including other recent measures.
The latest initiative, which includes a 20% reduction of the workforce, aims to improve margins, reduce operating expenses, and accelerate the company's path to profitability.
Valeo expects these cost reduction measures to reduce its operating expenses by more than $5 million on an annualized basis, which is on top of previous $2 million of cost reduction measures announced last November.
"Although this restructuring was primarily focused on our Respiratory Group, we remain fully committed to our three specialty units, respiratory, ophthalmic and hospital," said CEO Steve Saviuk.
"We felt that a leaner, more focused approach was needed to ensure the continued revenue growth for our key products while providing important cost efficiencies that will allow us to achieve profitability as quickly as possible."
He said both sets of changes are key elements towards improving operating results and overall financial performance.
"While this restructuring provides us with a sustainable operating structure from which we will continue to grow, the decision to implement these challenging but necessary changes affects many Valeo employees. We would like to express our sincere gratitude to all the employees affected for their dedication and contributions made over the years," Saviuk said.
Restructuring charges will be incurred in the third quarter of 2024.