Roche is restructuring its manufacturing network for small molecules to focus on specialised medicines produced in lower volumes.
As a result the Swiss company will exit four manufacturing sites in Clarecastle, Ireland; Leganes, Spain; Segrate, Italy; and Florence, United States. It will also invest 300 million Swiss francs (CHF) into a dedicated facility in Kaiseraugst, Switzerland to support “future technology requirements” for this new generation of specialised medicines.
“With these changes we are responding to the evolution of our small molecule portfolio towards specialised medicines produced in lower volumes,” says Daniel O’Day, chief operating officer of Roche’s pharmaceuticals division of Roche. “We are aware of the impact this decision has on our colleagues, and we will do our utmost to support them during this transition.”
In an effort to minimise job reductions, the company is looking into divestment opportunities for the closed facilities and will immediately begin discussions with employee representatives in the respective countries. It estimates that the closures will affect around 1,200 positions.
Transition will begin in 2016 and is planned to end by 2021.
It is expected that site exits will result in non-core restructuring costs of CHF 1.6 billion until 2021, of which up to CHF 600 million will be in cash. This also includes additional efficiency efforts undertaken in the manufacturing network and organisation. Roche says that estimated non-core costs in 2015 are up to CHF 800 million, with only a minor cash flow impact in 2015.