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Baxter says suspension of pump shipments triggered 91 layoffs

Baxter International says the suspension of shipments of certain products led to its decision to eliminate 91 positions at its Medina plant.

The Illinois-based health care products company said 370 employees will continue to work at the Orleans County facility, said John O’Malley, a Baxter spokesman.

Baxter said the layoffs stem from the company’s decision in April to suspend shipping Sigma Spectrum infusion pumps to new customers while it works with the Food and Drug Administration “to address modifications made to the device.”

Industry reports said the FDA on April 1 issued a warning letter to Baxter about the marketing of the Sigma Spectrum infusion pumps with Master Drug Library without providing the required notice that the device had been modified.

Baxter, in an April 16 letter to its customers, said it was suspending shipments of the Sigma Spectrum pump, with two exceptions: devices that were committed to customers prior to April 1, and incremental devices to existing customers upon certification of medical need.

In 2009, Baxter entered into an agreement with Sigma International General Medical Apparatus in Medina for a 40 percent equity stake in Sigma, exclusive global distribution of its infusion pumps, and an option to buy the remaining 60 percent of the company. The deal was worth $100 million. Baxter exercised its option in April 2012, completing its purchase of Sigma for a cash payment of about $90 million.

O’Malley noted that when Baxter first partnered with Sigma in 2009, Sigma had about 225 employees, compared to the 370 who will still be working there after the layoffs. “Our overall story has been one of growth in Medina,” he said.

Baxter will continue its operations in Medina and the company is in the process of rolling out transition services to assist laid-off employees, O’Malley said.

Sigma’s owner bought the Medina facility, which was a former Fisher-Price factory, in the mid-1990s.

Baxter recorded profits of $2.3 billion on sales of $14.2 billion in 2012 and has about 50,800 employees.