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Valeant expects $200 million in savings in 2012

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Valeant Pharmaceuticals International Inc. expects to find $200-million of cost savings this year as it works to fully incorporate the former Biovail and other smaller drug companies recently acquired.

Those efficiencies, outlined in a guidance conference call with analysts Friday, are expected to come from shedding redundant departments and jobs.

Valeant has about 5,000 employees but gave no indication how many jobs would be cut as it streamlines operations.

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The company is working to integrate a number of drug makers it bought — including the Edmonton-based maker of the Cold-FX flu treatment —after the merger with Biovail.

The company also outlined that total revenues for 2012 are expected to be between $3.1-billion and $3.4-billion at constant currency rates. That's a 30 per cent to 40 per cent increase over 2011 revenue.

Earnings per share are projected to be between $3.95 and $4.20, which is 40 per cent to 50 per cent higher than in 2011.

Valeant, a Mississauga, Ont.-based pharmaceutical company that focuses on nervous system and skin-care therapies, has spent $2.9-billion in the past year to buy several companies.

Most recently, the Canadian drug maker completed a $425-million acquisition of dermatology company Dermik from French pharma giant Sanofi. Dermik makes the acne drug BenzaClin.

In September 2010, Valeant and Biovail Corp. merged to become one company, with businesses around the world.

The largest acquisition was to acquire iNova, a private Australian drug maker in a deal that could be worth as much as $714-million.

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It also signed deals to buy the Ortho Dermatologics division of Janssen Pharmaceuticals Inc. for $345-million, Dermik, a dermatology unit of Sanofi in the U.S. and Canada, for $425-million, and Cold-FX maker Afexa Life Sciences Inc. for about $88-million.

Valeant chairman and CEO Michael Pearson said the company hopes to become a top 15 global pharmaceutical company by the end of 2013.

The drug maker said to achieve that goal, it will have to grow into other segments of the drug market, primarily through acquisitions. But it said it doesn't plan to consider a merger to grow.

"Our modus operandi is to continue to buy companies at reasonable prices and see disproportionate returns from those," Mr. Pearson said.

The company says there's no shortage of buying opportunities, but it is waiting to find the right deal at the right price.

Shares in the company fell 20 cents to $47.91 in Friday morning trading on the Toronto Stock Exchange.

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