The company plans to save 3bn Danish Krone ($444m) in costs in 2017 by reducing its headcount at headquarters and in commercial operations, and cutting early pipelines.
It revised its financial guidance for 2015 to predict 14bn Krone ($2bn) in revenues and 500m Krone core ($74m) EBIT, following 1.7bn Krone ($250m) in one-off write-downs in Q3. It will spend around $160m on severance payments and restructuring costs.
Lundbeck said it is seeking a competitive return on investment and needs “higher profitability to be able to invest in future profitable growth initiatives.”
The changes will see the company cut some unnamed early-stage drug programmes, and focus on existing products Abilify Maintena (aripiprazole for schizophrenia), Brintellix (vortioxetine, an SSRI), Northera (droxidopa, hypotension), Onfi (clobazam, seizures), and Rexulti (brexpiprazole, schizophrenia).
Lundbeck also plans to expand its new business service centre in Krakow, Poland, restructure operations at its headquarters in Valby, Denmark, and minimise administrative work at affiliate sites.
This is the latest of several major reorganisations in recent years for Lundbeck’s infrastructure. In 2012 it cut around 600 positions in its European subsidiaries, and a reorganisation in 2013 divided the company into six global regions and created 10 European business units.
Since May this year, Lundbeck has been led by former Novo Nordisk executive Kåre Schultz. The previous CEO, Ulf Winberg, resigned after a scandal followed his receiving a gift of shares from Stratified Medical Ltd around the time Lundbeck invested in the company.