Amgen Inc., the world’s largest biotechnology company, plans to reduce workforce by 14% amid the fear of declining sales of its top-selling drug, Aranesp.
Board decision will leave some 2,200 to 2,600 people jobless, but will save $700 million approximately. After hit hard by decreasing sale of its best selling drug Aranesp, company quickly enforced restructure plan, which aims to save more than $1 billion in 2008.
Company hasn’t short listed geographical locations, where job positions will be affected. However, speculations are soaring high as market experts are hoping that company will slash nearly 800 at its Elliott Bay campus, 230 in Bothell and 100 at 1201 Third Avenue in Seattle, but nothing is official.
While talking on the cut, company’s Spokeswoman Carol Pawlak, confirmed that the initial reductions will be made through attrition and hiring freezes and by seeking volunteers, who will be contacted within a week if it’s determined they’re qualified, based mainly on their years of service and age.
After languishing income forecast, Amgen reduced its adjusted earnings per share guidance for the full-year to between $4.13 a share and $4.23 a share from previous guidance of $4.28 a share. Company also reduces capital expenditures by $1.9 billion.
Company’s restructure plan doesn’t come as a surprise as Amgen signaled problems last month when it reported that worldwide sales of its anemia-treating drug Aranesp dropped 10% to $949m in the second quarter. The Food and Drug Administration found that the drug should carry a stronger warning label when used in cancer patients with anemia.
Aranesp was the company’s best-selling drug last year, with $4.12 billion in sales and with the set back, company has decided to cut back on expansion plans overseas and would refocus resources on research and development efforts.
Market volatility also effects on its shares values as while regular trading its shares were down by 73 cents at $50.59.
Via: Star-Tribune
