Hospira, Inc. HSP
Q4 2011 Earnings Call Transcript

Operator: Gregg Gilbert, Bank of America.

Gregg Gilbert - Bank of America-Merrill Lynch: Mike, I know you're not going to predict FDA's behavior, but given your extensive interaction with the agency and your consultants, what is your opinion as to whether the consent decree is on the table as a possibility? Then secondly, I have a bigger picture question. When you joined the Company, you seemed pretty confident that having pumps and drugs under one roof made sense for Hospira, and I was curious as to whether you've dug deeper on that issue and whether you still conclude the same thing?

F. Michael Ball - CEO: Gregg, yeah, with respect to any speculation on a consent decree, I just don't think that that's wise or possible. We are moving along, as I said before, in a partnership with the FDA, and I feel like we are doing the best at getting better, and I think the agency sees the extent of our efforts. A lot of the ongoing dialog with the agency is to further reinforce that perception, and also the fact that we will have a meeting with the agency over the next few weeks which will include the discussion around our mediation efforts. I think we'll go I hope again a long way in cementing this partnership of getting our remediation plans blessed by the FDA and get us moving in a positive direction. Again, you never know what the agency is going to do. But at this particular juncture, as I said, we have had no indication from them or any discussion with them of a consent decree. With respect to the second question on pumps and drugs being under the same house, coming in the organization, I like the fact that both of these things flow through the same customer channel, and from my standpoint there is leverage between these two areas. I see some leverage, I indicated at Investor Day that where we have pumps we have approximately a 20% increased uptake of SIP. From my standpoint on going forward, I believe that we can continue to leverage these two areas and I believe that the Company is much stronger having both of these product lines together under the same roof than splitting them apart. As I think I've mentioned before in a previous slide, I think there was very good reasons to spin out device because I did not believe that there was appropriate leverage. However, in the previous life as well, we brought device back in because there was leverage with the pharmaceutical portion and I believe that is the case as we see it here today.

Operator: Ami Fadia, UBS.

Ami Fadia - UBS: Firstly, could you give us a sense of which products are expected to be impacted by the production level assumption of 60% to 70% in your guidance and could you explain why you assume that the productivity levels remains at 60% to 70% throughout the year and what will it take to drive it above that?

Thomas E. Werner - SVP, Finance and CFO: I'll take the second part of your question. Our assumption at the lower end of our guidance is that it would remain at 60% to 70% for the full year. At the midpoint, we're assuming it begins to improve after the first half of the year. We will go into our July shutdowns and then we would expect that levels would improve. So, we haven't assumed at 60% to 70% for the whole year except in the lower end of the guidance. As far as the products in Rocky Mount, Rocky Mount produces a high number of anesthesiology drugs. I don't think there's any anti-infectives coming out of the facility to speak of. The best list that you can probably look at to get an idea unfortunately is the drug shortage list. There are quite a few drugs coming out of Rocky Mount that are showing up on the list. Propofol comes out of our Clayton facility, so that's not impacted by the Rocky Mount, but those are some of the drugs and the families that they are in.