PFI Growth Initiatives Include Personnel Shifts, Supply Agreements
This article was originally published in The Tan Sheet
Executive Summary
Pharmaceutical Formulations, Inc.'s strategic growth plans involve personnel changes, new supply agreements and a rights offering to shareholders
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Pharmaceutical Formulations, Inc.'s strategic growth plans involve personnel changes, new supply agreements and a rights offering to shareholders. In a recent statement, the Edison, N.J.-based private labeler noted that "business development activities relating to new products, brand development and potential mergers/joint ventures" have "broadened significantly," to the point where it is "necessary to separate the responsibility for future business development from that of current sales activities." As a result, Tony Cantaffa, who previously presided over both sales & marketing and business development, now will focus solely on the latter. His title will remain VP-business development. Hank Sokol will take over Cantaffa's other responsibilities as VP-sales; Sokol previously held the same position at Orchard, N.Y.-based Mentholatum Company. Sokol's assignments likely will include oversight of two new retail supply agreements. PFI noted it would begin shipping private label products to the new accounts this summer. The generics manufacturer already supplies products to CVS, Brooks, Rite Aid, Eckerd, Duane Reade, Shop Rite, Food Lion and Wegman's. PFI also noted it has reached "long-term supply arrangements with two major pharmaceutical companies." To raise funds for its various growth initiatives, PFI announced May 10 that all holders of its common stock and stock options will be eligible to receive 2.8 subscription rights for each share held at the close of business May 7. If all rights are exercised, PFI will raise $11.7 mil. in funds; the offering closes June 25. For the fiscal third quarter ended March 30, PFI recorded a 6.7% increase in sales to $12.7 mil. and a net loss of $1.3 mil., half the $2.6 mil. loss reported in the prior-year period. For the nine months, sales rose 5.1% to $38.8 mil. and the firm recorded a net loss of $6.2 mil., a 28.7% improvement over a year ago. PFI cited costs related to its supply agreements, as well as complying with the OTC labeling final rule, as adversely affecting its results. |