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Schering restructures for long-term growth

Published on 17/06/04 at 10:58am

German pharmaceutical company Schering AG will no longer conduct research and development into cardiovascular or, with a few exceptions, central nervous system (CNS) diseases following a series of strategic changes.

The company will instead concentrate its energies in just four areas: oncology, gynaecology and andrology, diagnostic imaging and specialised therapeutics.

The chairman of Schering's executive board Dr Hubetus Erlen said Schering will significantly increase its profitability by 2006, aiming to reach an 18% operating profit margin.

Dr Erlen plans to deliver cost savings in excess of E200 million and the company has cut its headcount by 1,100 and has plans for a further reduction of 900 jobs by 2006.

He added: "The reshaping of our business portfolio will enable us to concentrate our efforts on those fields with the best growth prospects for Schering."

Oncology will be a new therapeutic area for Schering and the company says it is committed to building a strong business presence for itself in this area. It will do this by expanding its haematology business and developing treatments for various solid tumours.

Gynaecology and andrology  will remain at the core of the company's business and it has ambitions to lead the US market for innovative fertility control products and assume a global leadership position within female healthcare.

Schering said its diagnostic imaging business should provide it with prospects for long-term growth, part of which will come from the emerging field of molecular imaging. Meanwhile, its specialised therapeutics business area will focus on researching and commercialising products in areas of high unmet medical needs.

As the company shifts its R&D resources into these core portfolio areas it will terminate its research programmes in cardiovascular and CNS diseases, with the exception of those in multiple sclerosis and those for spheramine, a novel cell therapy for Parkinson's disease.

The company will also spin off its dermatology business into a separate entity with 600 employees globally and headquarters in Berlin.

 

 

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