Novartis to make new round of job cuts

pharmafile | December 19, 2007 | News story | Sales and Marketing |   

Novartis will cut around 2,500 jobs as part of a new streamlining programme that aims to save $1.6 billion by 2010.

The decision has come at the end of a challenging year for the company, marred by industry pressures and weak sales.

It is the second round of job cuts inside three months, as Novartis declared plans in October to lose over a thousand staff and save $230 million after third quarter pharma sales fell by 2% in local currencies.

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Setbacks this year include the loss of irritable bowel syndrome treatment Zelnorm, which was pulled from the market in April, and US generic competition for products Lotrel, Lamisil and Famvir.

The new job cuts are part of a streamlining operation dubbed 'Forward', which has been designed to 'simplify working processes and decision making by eliminating layers', according to a company statement.

Novartis chief executive Dr Daniel Vasella said: "We have taken the opportunity given the short-term down-cycle in our pharmaceuticals business to initiate this project. This will simplify our organisation and redesign the way we operate."

The number of cuts represents 2.5% of the global workforce, and Novartis expects many will be achieved through normal staffing fluctuations.

The move marks the latest in a series of job cuts made by big pharma companies suffering from generic competition and flagging pipelines, including GSK, Pfizer and AstraZeneca.

Novartis expect to see an increase in speed and productivity in the later half of 2008.

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