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Baxter expects $70 million hit to fourth-quarter sales from Hurricane Maria
October 25, 2017 / 11:52 AM / in 2 months

Baxter expects $70 million hit to fourth-quarter sales from Hurricane Maria

(Reuters) - U.S. hospital products maker Baxter International Inc on Wednesday forecast a nearly $70 million hit to its fourth-quarter revenue, due to manufacturing disruptions arising from Hurricane Maria.

Baxter said all three of its facilities in Puerto Rico - which was devastated by Hurricane Maria last month - were currently in limited production.

Deerfield, Illinois-based Baxter makes items such as premixed injectables and products used in the delivery of medications from its Puerto Rican sites.

Baxter is the latest U.S. company to forecast the financial impact of the disaster, which knocked out electricity and caused widespread damage to homes and infrastructure in Puerto Rico.

About 10 percent of the drugs prescribed in the United States are made in Puerto Rico, and most major drug companies including Merck, Johnson & Johnson, Pfizer and GSK operate facilities there.

The U.S. Food and Drug Administration (FDA) said last week it was working with healthcare companies in Puerto Rico to prevent shortages of medical products in the United States.

FDA Commissioner Scott Gottlieb has said the agency is monitoring more than 40 drug products in Puerto Rico.

Medical device maker Medtronic and drugmaker Depomed earlier this month said Maria was expected to impact their earnings.

Baxter expects Hurricane Maria to have “very little” impact in the first quarter of 2018, Chief Executive José Almeida said on a call with analysts.

Products affected by Maria should return to healthy inventory levels by the first quarter, Almeida added.

The company said the FDA had given it a temporary green light to import some products from facilities in Ireland, Australia, Canada and Mexico to fill supply gaps in the United States.

Baxter on Wednesday also reported third-quarter earnings above Wall Street analysts’ estimates.

Its shares were slightly lower at $64.19 in morning trading.

Reporting by Akankshita Mukhopadhyay in Bengaluru; Editing by Sai Sachin Ravikumar

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