Novartis slashes 2,000 jobs despite higher earnings
Swiss pharmaceutical giant Novartis said Tuesday it would slash 2,000 jobs, mostly in Switzerland and the United States, despite reporting third quarter net profits of $3.53 billion (2.5 billion euros).
The firm said in a statement that profits for the quarter were up 12 percent but that the job cuts were part of a $300 million restructuring programme to strengthen productivity.
The group will close one plant in Switzerland and another in Italy as part of cost-saving measures to be spread over three to five years.
Research currently based in Switzerland would be transferred to the United States, Novartis said.
While slashing jobs in the higher-cost industrialised countries, the pharmaceutical group said it would create 700 new jobs in "low cost and other countries."
"To strengthen our future, we have accelerated actions to reduce our cost base over the next few years," said the group's chief executive Joseph Jimenez.
"These actions are necessary to ensure that we adapt our organization to continue delivering on our mission of bringing innovative new drugs to patients," he added.
Meanwhile, sales in the July through September period increased by 18 percent to $14.84 billion.
The results sent shares in Novartis falling 2.2 percent in Tuesday late morning trade, underperforming the overall Swiss Market Index, which was down 0.50 percent.
© 2011 AFP