Novartis ($NVS) has been squeezing costs out of its eye product operations since buying Alcon for nearly $50 billion several years ago. Analysts at the time suggested there was at least $700 million in savings to be had, mostly through layoffs. That process continues and the Swiss drugmaker plans to close up shop at a plant in Canada next year, whacking 300 jobs in the process.
The drugmaker last week told the Globe and Mail that layoffs at the plant in Mississauga, Ontario, will begin in May and operations will finish up by the end of next year. A plant in Texas will take over Canada's contact lens solution production, ramping up with a more efficient process. The Texas plant will not need any more employees to add to the production.
"We're continuously reviewing and adapting our manufacturing environment to reflect changing market dynamics and enhancing our competitiveness," said Mark Smithyes, head of government affairs and market access for Alcon Canada. The Swiss-based drugmaker got full control of Alcon from Nestlé in a three-step process concluded in 2011.
One employee told the newspaper that it was a shock, saying that when workers were called in last month to get the news, they believed there would be some layoffs but did not expect to learn that Novartis would abandon the plant.
Novartis has made other cuts in its manufacturing network this year. It cut 300 jobs at its troubled consumer healthcare plant in Lincoln, NE. At about the same time, it announced plans to expand a consumer healthcare plant in its home country that it had planned on closing, saying it would spend money to modernize the facility and expand production.
- read the Globe and Mail story
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