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Abbott slashes 700 jobs

Published on 31/01/12 at 10:23am
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Abbott Laboratories has said it will cut 700 jobs across its US and Puerto Rican operations, including hundreds of manufacturing posts, despite posting sales and earnings growth in 2011.

The announcement comes as Abbott gears up for a major reorganisation of its businesses, including a separation of its biologics and pharmaceuticals from generics, medical devices, diagnostics and consumer healthcare products which is due to complete by the end of this year.

The US-headquarter drugmaker has said it plans to lay off around 300 workers at its vascular-stent manufacturing plant in Temecula, California, as well as another 200 diagnostics positions from its main site in Lake County, Illinois. Most of the remaining 200 cuts will be applied in Puerto Rico, according to the company.

One of the main reasons for the layoffs at the Temecula plant is the upcoming expiry of Abbott's contract to manufacture and supply the Promus everolimus-eluting cardiovascular stent, to Boston Scientific Corp. 

The latter is introducing a new-generation version of Promus - called the Promus Element Plus - which it will manufacture in-house. The new version of Promus was approved by the FDA in November 2011, and the phase out of the older version is a double blow to Abbott as it receives a 40% share of the profits under a co-marketing alliance.

Local news reports suggest that several hundred additional layoffs could hit Temecula over the course of the year. 

This is the third round of job losses to be announced by Abbott in 12 months. In January 2011 the drugmaker said it would reduce its workforce by around 2% - or 1,900 positions - after a period of lacklustre growth at its pharmaceuticals division. It followed that in September 2011 with a decision to cut its diagnostics workforce by 160 staff.

Phil Taylor

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