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Lundbeck cuts 600 sales jobs in Europe

Danish firm looks to other markets for growth as generics and tough economic climate hits sales

Lundbeck HQ

Lundbeck is set to cut 600 commercial positions as part of major restructuring efforts to cope with the patent loss of its antidepressant Lexapro (escitalopram) as well as tough economic conditions.

The Danish-based pharma firm said the jobs will go across its subsidiaries in Europe, although the company said it would still investment in growth markets, including the US.

“We will do our utmost to manage the process in a respectful way,” said the company in a statement, “and will now initiate a consultation process regarding the anticipated staff reductions with the works councils in the most affected markets.”

It is expected that Lundbeck will encounter costs of up to 500m Danish krone during its cost-cutting efforts during 2012, although the exact figure is still to be determined based on the implementation of the plan as well as negotiations with various local stakeholders. Specific countries where jobs will be lost were not referenced by Lundbeck.

"The market environment in Europe is changing rapidly at a time when Lundbeck has numerous new products to launch,” said Ulf Wiinberg, president and CEO of Lundbeck.

“To ensure a successful transition of our product portfolio in Europe we need a more flexible commercial infrastructure and to maintain cost control."

New products in development for the company include new antidepressant LU AA21004 that reported positive phase III data in May, 2012.

The company is also looking further afield than Europe, recently launching Lexapro in Japan and signing a multi-billion dollar alliance with Otsuka – another CNS-focused pharma firm with a strong presence in North America and Asia.

News of the job cuts comes one month after Lundbeck's head of commercial operations Marie-Laure Pochon resigned, citing family and private reasons, and just four months since Lundbeck reorganised its European operations into two regional units, a move the company said at the time would give it "optimal conditions for success in developing and expanding".

15th June 2012

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