Schering, BMS cut manufacturing staff

Related tags Bristol-myers squibb Schering

Germany drugmaker Schering is planning to reduce its headcount by
1,250 with most of the cuts coming in production. The company is
blaming increased cost pressures due to European and international
competition.

In Germany, approximately 950 jobs will go: 700 jobs at Schering's production site at Bergkamen and 250 in Berlin. About 300 will be reduced at sites outside Germany.

Earlier this year, Schering announced a headcount reduction of approximately 2,000 jobs globally. As of September 30, already more than 600 posts were cut and about 1,800 of the 2,000 will go by the end of 2005.

"The decision to reduce headcount has not been an easy task for us. But, we have to do everything to ensure the competitiveness of our company in the long term and thereby secure remaining jobs, "​ said Jorg Spiekerkotter, executive board member responsible for finance and personnel.

The moves will enable Schering to achieve an operating profit margin of 18 per cent by 2006, he added. The cuts will lead to a one-time charge of €70 million.

Meanwhile, US drug major Bristol-Myers Squibb has also started laying off people in its manufacturing facilities after a difficult period for the company, which has been hit by late-stage product failures and generic competition to some of its top-selling drugs. But the firm insists a recovery is on the way with three new products due to be filed by year-end.

The company has eliminated the jobs of 70 scientists, chemical engineers, managers and support staff at its facilities in New York and New Jersey in the US, as it begins to align manufacturing operations for its new portfolio of medicines. BMS announced in August that it would cut 120 jobs over the next two years as it ends antibiotics manufacturing.

At an investor's meeting, BMS unveiled positive data from one Phase II and three Phase III clinical trials for its investigational diabetes compound muraglitazar, which will be filed for approval in the US by the end of the year.

The company also recently submitted applications in the US and Europe for entecavir, an investigational treatment for hepatitis B, and will also seek approval abatacept, an antibody-basted for rheumatoid arthritis, by year-end.

BMS maintains that with three new drugs approved in the last 16 months - Abilify (aripiprazole) for schizophrenia, Erbitux (cetuximab) for colorectal cancer and Reyataz (atazanavir sulfate) for HIV - plus its three new filings, the recovery of its pipeline is complete.

The company will still employ 800 people in East Syracuse, New York, where it has a technology center. BMS has spent $60 million to expand its biologics drug-making capabilities since 2001 and another $50 million to expand its laboratories at the site.

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