Novartis AG Plans More Cuts and Consolidation
9/16/2011 6:59:56 AM
During an investor presentation the other day, Novartis execs spent considerable time not only discussing recent financial performance and pipeline progress, but also the many steps taken to save money. These include a raft of cuts across various divisions around the globe and, in the US, consolidating some operations, such as shifting some research from Boston to New Jersey. For instance, over the last 18 months, more than $1.6 billion was saved by reworking procurement, mostly from the pharma unit. Since November, six manufacturing sites are in the process of being “exited.” Selling, general and administrative expenses have dropped from 5.2 percent of sales to 4.9 percent since 2009 (see the slides). And marketing and sales expenses fell from 29.3 percent of sales to 27.2 percent during the same period, including the elimination of 1,400 sales reps (read here).