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AstraZeneca to cut 700 jobs across USA

December 12, 2016
Life sciences

Pharmaceutical company AstraZeneca announced Thursday it will eliminate 700 positions across the United States by early 2017.

The company’s U.S. headquarters in Fairfax, Del., will see about 120 job cuts.

“The remaining impacted roles are field-based roles across the US and include both sales and non-sales roles,” said a company spokeswoman via email. “These changes are specific to the US Commercial Business and do not apply to other parts of the business, including Newark, or other US-based global employees.”

In September, AstraZeneca (AZN) reported having 2,100 workers in Delaware, including those working in Newark, Del., global roles based in Wilmington, Del., and contractor positions. On Thursday, the British company said the 120 impending job cuts would bring its total state workforce to 1,500. Company executives declined to elaborate on the discrepancy.

“Those are the figures we have available today,” the spokeswoman said via email.

Delaware is expected to take the largest hit among AstraZeneca’s U.S. operations when the layoffs take effect Feb. 10. The AstraZeneca statement did not say how many employees are in the United States.

“My heart goes out to the employees and families impacted by this announcement,” Delaware Gov. Jack Markell said in a release.

AstraZeneca declined to provide any information about the severance packages that will be offered to its laid-off workers.

“AstraZeneca is committed to treating every employee with dignity and respect throughout this process,” the spokeswoman said. “Employees who are impacted will be provided with internal and external assistance and support.”

In an announcement posted on the company’s website, AstraZeneca said the layoffs are part of the company’s return to growth strategy. The company’s U.S. revenue was down in 2017.

“These changes reflect the ongoing focus to further streamline and drive greater efficiency across the entire organization,” the statement said. “We continue to face loss of exclusivity impacts from many of our legacy products and work to compete in an ever-changing external environment.”

AstraZeneca received a large economic development incentive package from then-governor Tom Carper in 1999 that brought the company’s U.S. headquarters to Delaware. The company received a $40.7 million package of grants and tax credits, along with $70 million in road improvements to convince the newly formed AstraZeneca to establish its North American headquarters in Fairfax. In exchange, AstraZeneca pledged to increase its work force at the site from 2,400 to 4,000 by 2004.

AstraZeneca’s employment hit a peak of 5,000 workers in 2005, only to have patent losses and a global recession lead to a major restructuring that has gradually reduced the company’s local work force.

“AstraZeneca’s announcement of layoffs to its Delaware headquarters is deeply disappointing,” Carper, now a U.S. senator, said in a news release.

“While this is a tough time for the company, I am hopeful it will gain solid footing and be able to grow and thrive with the new drugs in its pipeline,” he said.

The drugmaker is in the midst of a transformation. The company has shifted its focus from highly-competitive pharmaceutical markets such as antibiotics to medicines that target diseases with little or no treatment options. That strategy has fueled AstraZeneca’s $4 billion purchase of a stake in Acerta Pharma, a Netherlands company developing a rare blood cancer medicine that would have only one competitor on the market.

Executives in May first announced plans to cut sales and manufacturing operations as part of an effort to eliminate $1 billion from its budget by the end of 2017.

In a move to cut costs, AstraZeneca sold its molecular antibiotics business to Pfizer in August for $1.6 billion. Weeks later, the company said it would be closing its Fort Washington, Pa., plant and relocating all 134 workers to its Fairfax headquarters.

It was not immediately clear how many of those relocated workers were included in the layoffs announced Thursday.

The layoffs at AstraZeneca just weeks before Christmas echo the mass layoffs DuPont Co. announced in 2015. The chemical giant broke the news that it intended to cut 1,700 jobs in Delaware just days after the holiday. Those workers were all let go by the end of March.

By Jeff Mordock and Scott Goss

Source: USA Today

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