May 19, 2017
By Alex Keown, BioSpace.com Breaking News Staff
BASEL, Switzerland – Novartis AG is shaking up its operations by terminating approximately 500 production and development positions in Switzerland, but adding an additional 350 jobs to its growing biotech business, Matthias Leuenberger said in a posting on the company’s Swiss site.
In the posting, which is available in French, Leuenberger said the jobs set to be eliminated will be phased out by the end of 2018. The jobs that are being affected by the reorganization are traditional production, coordination and development. The jobs being targeted for elimination are in the region of Basel, the company’s headquarters.
“These adjustments are necessary to preserve long-term competitiveness; It is, however, a severe ordeal for the employees concerned. We are fully aware of this and will treat all those involved with the utmost respect and fairness,” Leuenberger said in the posting.
The new positions being created are being described as high-tech positions in the areas of biologics manufacturing.
“The planned measures underscore our long-standing commitment to Switzerland, which is our global headquarters, and is an investment in our ability to innovate and grow. They also reflect the attractiveness of Switzerland as a center of innovation and employment in high-value-added sectors,” Leuenberger said.
Novartis employs about 13,000 people in Switzerland, Swiss Info reported.
Last year Novartis introduced an “integrated development model” as part of a global transformation. That model includes three focused, customer-facing divisions. The divisions will be Innovative Medicines (formerly the Novartis Pharmaceuticals division), which will include the Novartis Pharmaceuticals and Novartis Oncology business units; Sandoz, the generics and biosimilar division, which includes the Retail Generics, Anti-Infectives and Biopharmaceuticals franchises; and Alcon , the struggling eye care division, which includes the Surgical and Vision Care franchises. The divisions will be supported by Novartis Institutes for BioMedical Research, Global Drug Development and Novartis Operations, which includes Technical Operations and Novartis Business Services.
Leuenberger said the reorganization is being taken in order to accelerate innovation while optimizing the quality and efficiency of the company’s global activities.
Leuenberger said there are no other “adjustments of this magnitude,” meaning layoffs of up to 500 people, scheduled for Swiss-based employees through the end of 2018. Leuenberger said though that he could not rule out smaller-scale layoffs, what he termed as “a few modest adaptations that are part of the normal course of business.”
Layoffs are nothing new for Novartis. In August, Novartis disbanded its Cell and Gene Therapy Unit, a division that employed 400 people. Some of those employees were shifted to other Novartis units, but there were about 150 layoffs.
More layoffs could come as Novartis is considering selling off its Alcon division. In April, the company hired Bank of America to review its options when it comes to the potential deal due to underperforming revenues. In January, Chief Executive Officer Joe Jimenez said all options are on the table when it comes to the division, which posted flat fourth-quarter sales and an operating loss of $120 million. Novartis has attempted to turn around Alcon. Last year, Novartis tapped former Hospira executive Michael Ball to help turn Alcon around.
