King Pharmaceuticals To Lay Off 72

King Pharmaceuticals will lay off 72 people at its Bristol, Tenn., plant this spring due to concerns over the future of its most popular drug, company officials said Friday.

“This is very unfortunate,” King spokesman James Green said Friday, adding that the layoffs will leave the Bristol plant with 430 employees.

On Jan. 21, a federal judge invalidated two of the three patents King Pharmaceuticals has for Skelaxin, a muscle-relaxer that is the company’s top-selling drug.

The ruling stems from a January 2003 suit King filed against Eon Labs Inc. and its successor Sandoz Inc. in the U.S. District Court for the Eastern District of New York, Green said. The ruling was done without the benefit of a public hearing and will be appealed by the company as soon as possible, Green said.

If King loses its third Skelaxin patent, Green said, rival drug companies would be free to develop generic versions of the drug. That could result in a major financial loss for the company, he said.

“We are taking this action out of the uncertainty this lawsuit creates,” Green said of the layoffs. “We have to align our cost structure with our business prospects.”

Green said the layoffs will take place between March 31 and April 13. All branches of the company will be affected by the loss of “many good employees,” he said.

The company will offer severance packages, benefits and career transition help to those losing jobs, he said.

The state government also will lend a hand, said Jeff Hentschel, a spokesman for the Tennessee Department of Labor and Workforce Development. Hentschel said that King notified his department’s Rapid Response Team on Friday about the coming layoffs. The response teams help people find information about state services such as job training programs and unemployment insurance.

King’s stock closed Friday at $8.74 a share, dropping in value by 27 cents or about 3 percent during the day’s trading. The publicly traded company employs more than 2,000 people across the United States.

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