A leading pharma company successfully transforms its operations and go-to-market strategy.
Douglas Ingram on Allergan Transformation
Douglas Ingram rose through the ranks at Allergan over the past 20 years, during a period of extremely strong growth for the company. Allergan is a global pharmaceutical company originally based in Irvine, California, that makes products in a range of categories, including ophthalmology, dermatology, neuroscience, and urologics, among others. Ingram ultimately became president in 2013, as Allergan needed to make changes to keep pace with a dynamic pharmaceuticals market.
In response, Ingram launched a transformation effort that was ambitious in both timing (just six months to develop and implement) and scope (virtually everything was on the table for consideration). The company’s goal was to restructure in order to accelerate earnings growth beyond its historical rate of 15%, so that it could deliver greater value for shareholders. Just as the company launched the transformation, it faced another challenge—a hostile takeover attempt—that redoubled the company’s sense of urgency.
In response and in partnership with BCG, Allergan cut low-ROI activities and restructured quickly, reduced costs by more than $500 million, and increased its earnings growth rate from 15% to more than 20%. Shareholders and analysts approved, increasing the company’s overall market value by some $20 billion. As a result of these changes, Allergan’s management was able to avoid the hostile takeover and pursue a deal with a different acquirer—Actavis—on better terms.