GSK reviews Montrose API plant

By Gareth Macdonald

- Last updated on GMT

Related tags Glaxosmithkline Gsk

UK drug major GlaxoSmithKline is examining operations at its active
pharmaceutical ingredient (API) manufacturing plant in Montrose,
Scotland, with an eye to potential job cuts.

According to various media reports, the facility currently employs around 450 manufacturing personnel and produces ingredients for 20 of the company's products, including treatments for respiratory disorders, highly infectious diseases, skin conditions and cancer.

Claire Brough, a GSK spokesperson, told that the firm is " currently conducting a review of the Montrose facility, looking at the overall dynamics of the site in an effort to make it as cost effective as possible ."

She added that the review is expected to be completed sometime in July.

Brough explained that the while review is ongoing as part of the drug major's £700m ($1.4bn) global restructuring programme that was announced late last year, employees at the site have been notified about the potential for a small number of job cuts.

She added that in such circumstances, the firm will initiate a full consultation period with workers. ' Operation Excellence' In 2001, shortly after the merger between Glaxo Wellcome and Smithkline Beecham that established the drug major, GSK said that it planned to divest the facility to Dutch chemicals group Akzo Nobel and reduced its workforce by around 700 employees.

When that deal subsequently collapsed, staffing at the Montrose plant remained at the reduced level.

In 2007 GSK, the world's second-largest drug company unveiled its 'Operation Excellence' restructuring scheme, which is designed to deliver annual pre-tax cost savings of up to £700m by the year 2010.

The plan said that costs would be reduced through increased use of off-shoring and outsourcing to manufacturing specialists.

At the time GSK's CEO Jean-Pierre Garnier, who retired last month, said that such a move was crucial to the firm's efforts to adapt to the increasingly competitive global environment.

Prior to GSK's announcement Pfizer, the world's leading pharmaceuticals group, announced that 10,000 positions will be axed worldwide, while AstraZeneca, the UK's second-biggest drug firm, said that it would be reducing its workforce by around 7,600 employees.

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