Amgen (AMGN) Eliminating Up To 2,900 Jobs; Will Shutter Seattle, Bothell Sites
7/29/2014 5:03:28 PM
Amgen To Layoff Up To 15 Percent Of Workforce
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July 30, 2014
By David Sohn, BioSpace.com Breaking News Staff
Amgen (AMGN) announced plans Tuesday to close its Elliot Bay campus and Bothell manufacturing plants in Washington State. The California-based company, which currently employs 20,000 worldwide, is seeking to consolidate its operations to its Thousand Oaks and South San Francisco locations as a cost cutting measure. Closures of its Washington facilities could affect as many as 660 employees.
The world’s largest independent biotechnology firm stated that it would offer to assist in the relocation of some employees affected by the closures, but details on the expected layoffs still remain unclear. Amgen is part of a large biotechnology presence in Seattle with about 190 other pharmaceutical and bioscience companies in the area. In 2004, Amgen’s iconic 750,000 square-foot campus in Elliot Bay was completed at a cost of $625 million dollars. The company announced plans in 2006 to further expand the campus an additional 550,000 square-feet to accommodate its expanding operations.
The layoffs could affect up to 15 percent of Amgen’s global workforce, but the cost-cutting measure is expected to save $700 in operating expenses by 2016. A company spokesman stated that most of the savings would be utilized for the development of new products. The consolidation and restructuring is estimated to cost between $775 and $950 million.
Amgen announced its Q2 earnings Tuesday after market close. The company exceeded analysts’ expectations for the quarter by reporting an earnings per share of $2.37, compared to the $1.99 consensus estimate. According to the report, total revenue increased 11 percent to $5.2 billion, with sales driven by its popular arthritis drug Enbrel.
Despite plans to close its Washington facilities, chief executive officer, Robert A. Bradway reaffirmed investors of Amgen’s financial strength. "Robust growth through the first half of 2014 affirms the underlying strength of our business," Bradway said. "We are making excellent progress in advancing our pipeline as we prepare to launch a number of promising new innovative medicines. From a position of strength, we have announced today restructuring initiatives that will allow us to reallocate resources to invest in our upcoming launches and drive growth."
The company is currently the maker of 12 FDA approved drugs for 17 different conditions. As of December 2013, Amgen had 11 drugs in its development pipeline.
Since its foundation in 1980, Amgen has made at least five major corporate acquisitions, including Immunex in 2002 and Onyx Pharmaceuticals in 2013.
Shares in Amgen were trading 5 percent higher this morning at $129.30.
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