Novartis to cut workforce by 2,000

Swiss drugmaker Novartis is slashing 2,000 jobs in Switzerland and the United States as it seeks to rake in annual savings of…

Swiss drugmaker Novartis is slashing 2,000 jobs in Switzerland and the United States as it seeks to rake in annual savings of more than $200 million in the face of growing price pressures and the strong Swiss franc.

The measures, which affect 1.7 per cent of its workforce, will be carried out over the next three to five years and will include the closures of two sites in Switzerland and one in Italy.

Novartis said it would be scaling back and outsourcing activities like technical research and development, data management, clinical trial monitoring, drug safety and epidemiology and drug regulatory affairs.

Novartis expects to take a restructuring charge of around $300 million in the fourth quarter.

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The soaring franc has made the cost of doing business in Switzerland very costly, and both Roche and Novartis are looking to keep costs down there by outsourcing the more commoditised elements of their businesses to less expensive centres.

Cross-town rival Roche warned the robust franc was likely to hit its full-year earnings when it posted third-quarter sales earlier this month.

Novartis' third-quarter core earnings per share rose to $1.45, largely in line with the average estimate of $1.46 in a Reuters poll.

Reuters