The European Commission has said that Sweden should receive 4.3 million euros from the European Globalisation Adjustment Fund (EGF) to help 700 employees made redundant by AstraZeneca back to employment.

"The pharmaceutical industry is currently undergoing significant changes in order to retain its competitiveness in a tough environment, and it is therefore increasingly seeking synergies to hold down the rising costs of R&D activities," said the EU Commissioner for Employment, Social Affairs and Inclusion, Lazlo Andor.

He was confident, he added, that the proposal, which now goes to the European Parliament and the EU's Council of Ministers for their approval, would help to make the ex-AstraZeneca workers' transition to new jobs "easier and faster."

Sweden had applied for support from the EGF concerning 987 redundancies from AstraZeneca following the firm's closure of its R&D sites in the municipalities of Lund and Umea and limiting operations in Molndal and Sodertalie. Of the total 987 workers, 700 who will have the most difficulty in getting new jobs are targeted for support from the EGF. The package aims to help them by offering them occupational guidance and job search assistance, as well as vocations training and retraining, and help with self-employment.

The total cost of the package is estimated at around 6.6 million euros, of which the EGF would provide 4.3 million euros.

The Commission notes that, as the pharmaceutical industry is increasingly seeking synergies to hold down the rising costs of R&D activities and retain its competitiveness, many companies are in a state of transition, which results in reorganisations, consolidations, merger and acquisitions. Global investments and biotechnological research are increasing, and new competitors are growing in strength in China, Brazil and India.

Many non-European countries are designing strategies for biosciences and industry in areas of pharmaceuticals, biotechnology and medical technology. AstraZeneca, which had three R&D centres in Sweden, followed the trend and adopted a new R&D strategy in 2010. This included the necessity to focus on fewer disease areas, closures of sites (including those in Lund and Umea) and significantly greater utilisation of external resources through outsourcing, it adds.

Most of the firm’s redundancies were in Lund in southern Sweden, but the job losses also affect Umea in northern Sweden, Sodertalie in the metropolitan area and, to a lesser extent, Molndal in western Sweden. Unemployment increased in all affected municipalities from January 2009 to November 2011. 

There have been 101 applications to the EGF since the start of its operations in 2007, and around 435.3 million euros have been requested to help about 90,481 workers. EGF applications are being presented to help a growing number of sectors, and by an increasing number of European Union (EU) member states, the Commission notes.

Meantime, the new Cyprus Presidency of the EU Council has told Members of the European Parliament (MEPs) that the way out of the current economic crisis "is through growth-enhancing policies and investment in research and innovation."