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Germany loses out in Astellas restructuring

Published on 02/08/07 at 05:04pm

Astellas has announced streamlining and cutbacks to its operations across Europe, with operations in Germany losing staff in its saleforce and in drug development.

The Japanese company is the latest in the sector to disinvest in Germany, which is increasingly seen as a hostile environment for pharma.

Heavy mandatory price-cuts have persuaded a number of companies to freeze investment or pull out of the country, with Merck Serono being one company to move its headquarters out of Germany following its merger.

Astellas' European operations employ 3,300 people with sales of €1,463 million in the company's last financial year, making it the company's second largest profit centre.

The company says its medium-term plan is to make its European business  a stable revenue and profit base, and the company began its cost-cutting programme by selling off three of its European production plants in January.

The restructuring has now turned to R&D and sales and marketing, with the company consolidating its two development sites in the Netherlands (Leiderdorp) and Germany (Munich) into the Dutch facility, with the German site closing.

Meanwhile, Germany will suffer further losses with a reduction in the country's field force, which the company says is a direct result of stringent healthcare cost-containment measures enforced by the German government,

Astellas says its salesforce in Germany will be reduced to improve both profitability and efficiency of the country affiliate.

Support staff functions will also face further streamlining, with Germany losing out once again, with functions moved to either the UK or the Netherlands.

The company says all the changes will result in around 200 job losses in total.

The plans are subject to the usual consultations with works councils, and the company hopes to conclude the process by March next year.

Astellas forecasts the restructure will cost around Yen 12 billion in expenses for integration and closure of business bases, with around Yen 5.4 billion already written off.


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