AstraZeneca, Britain’s second-largest pharmaceutical company has announced a plan to outsource its entire drug manufacturing activities within ten years.
David Smith, AstraZeneca’s executive vice-president of operations, said that the company aimed to become a pure research, development and marketing organisation.
“Manufacturing for AstraZeneca is not a core activity," Mr Smith said.
“AstraZeneca is about innovation and brand-building . . . There are lots of people and organisations that can manufacture better than we can.”
Restructuring
The company is undergoing a restructuring drive designed to cut costs and improve profitability before the expiry of patents on key drug.
The priority would be to outsource all of AstraZeneca’s manufacturing of active pharmaceutical ingredients – the basic chemicals used to formulate conventional medicines.
Later, the company would seek to strip out and outsource more advanced manufacturing and logistics activities.
At present, AstraZeneca has 27 manufacturing sites in 19 countries.
In February, the company announced a plan to cut 7,600 jobs, 11 percent of its 66,000 global workforce.
The majority of cuts announced so far are in the group’s manufacturing and supply-chain operations.
Astra-Zeneca’s research unit, which employs about 12,000 people is not expected to reduced.
Other big pharmaceutical companies, such as Pfizer, the huge American group, have also begun outsourcing manufacturing recently.
The company, which is the world’s biggest drug maker said last week that it was shedding 420 jobs at its British factory, at Sandwich, Kent. It also told of plans to outsource some functions.
September 19 2007
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