Novartis marks 235 admin jobs for deletion amid companywide restructuring

Novartis ($NVS) is ticking off another 235 boxes on its job cuts list. The Swiss drugmaker plans to lay off 215 administrative and support staff in New Jersey by the end of June, and another 20 in similar positions elsewhere in the U.S., the Star-Ledger reports.

Most of the New Jersey cuts will come at Novartis headquarters in Hanover. They follow another 92 layoffs in the state two months ago.

All of the jobs cut are part of a worldwide restructuring Novartis announced in February. The company plans to cut or shuffle up to 4,000 jobs in its pharma business, with many of the positions moving to a new operations center in Hyderabad, India. Already this year, the company cut and reshuffled 500 jobs in Switzerland, to move resources from R&D and admin functions to other positions in the pharma business, generics and over-the-counter drugs. Another 525 jobs fell victim to a planned manufacturing shutdown in New York.

Overall, Novartis says, its global workforce will remain relatively stable. So, jobs will be moving, rather than disappearing; as part of that, the company has been consolidating back-office operations to a handful of business centers around the world. The new Hyderabad facility will join that group. When it is up and running next year, the ops center will be equipped to house some 4,500 workers, the company says.

This year's cuts follow at least 1,000 layoffs in 2013, which hit several of Novartis' divisions. An Alcon plant shutdown will hit 299 workers, while another 300 jobs are evaporating at the company's consumer health plant in Lincoln, NE. Another 300 jobs were targeted for the ax in a pharma R&D reshuffle in November, with several dozen cut in sales and marketing at the same time. A vaccines facility in Emeryville, CA, lost another 54 jobs.

The layoffs are only one part of Novartis's restructuring plans. The company is in the midst of a worldwide strategic review. At a time when its fellow Big Pharma companies are shedding units to refocus on their most promising operations, Novartis is eyeing its own divisions for opportunities to sell or spin off on the one hand, and partner up or buy in on the other. For months, rumors have swirled that Novartis would trade its animal health and vaccines businesses--or pieces thereof--for Merck's ($MRK) consumer health unit. Merck's consumer business has other bidders interested, however, so that idea may never come to fruition.

Joe Jimenez

In any case, the Swiss drugmaker has said it's most interested in unloading animal health and vaccines. Alcon, its eye business, and Sandoz, its generics division, are hefty enough for Novartis to keep in its fold. The company already sold its blood-diagnostics operations to Spain's Grifols.

But while that big-picture restructuring is underway, CEO Joe Jimenez intends to shed costs wherever possible. Hence the job cuts. "I am not satisfied with operating margins," Jimenez said at an investor conference in January. "We intend to increase these margins over time, and we begin now."

- read the Star-Ledger story

Special Reports: The top 10 largest pharma layoffs of 2013 - Novartis | Top 10 pharma companies by 2013 revenue - Novartis

Editor's note: This story was revised to say that the Novartis business center in Hyderabad can accommodate 4,500 workers when fully operational, rather than 8,000 as previously reported.

 

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