Novartis closes factory and reduces R&D at Horsham, Sussex. Government promises new pharma action plan
Novartis is closing down a large chunk of its work at Horsham in south east England - the latest in a series of cutbacks by pharma firms in the UK that have today prompted the government to promise a new action plan for the industry.
The bulk of the job losses announced by Novartis are in manufacturing rather than on the R&D side, with about 550 jobs in total reported to be redundant.
The respiratory R&D work employing 330 people is set to continue and exactly how many jobs will go amongst scientists is not clear. The Swiss pharmaceutical giant's gastrointestinal research teams at Horsham in West Sussex are going to be moved to Basel and Cambridge.
The closure is bad news after the decision by Pfizer to close its R&D lab in Sandwich, Kent, with the loss of 2400 jobs, and thousands of other pharma R&D job losses in Britain recently.
MPs on the science select committee are already investigating the Pfizer closure and today's news seems certain to prompt more debate about whether Britain - and indeed the world - now has a truly fundamental problem with its pharmaceutical industry and medical science. The National Endowment for Science Technology and the Arts tackled some of the questions in an event yesterday in London and Derek Lowe's blog is good on the global trends.
The credit crunch has put funding for basic medical research under pressure both at the UK's Medical Research Council and the National Institutes of Health in the US. The Cambridge-based venture capitalist Lucy Marcus has warned recently that the cutbacks are contributing to wariness among investors.
The Novartis move will also increase pressure on the government's growth plans just a week before George Osborne delivers the Budget. A promised white paper on growth has already been delayed and downgraded. And with the new financial year days away, the government has yet to give the Technology Strategy Board, its flagship agency for hi-tech innovation, a budget - while David Cameron's own innovation guru, James Dyson of vacuum cleaner fame, has seemingly turned his back on the government's approach.
TEXT OF NOVARTIS PRESS RELEASE TODAY AT 4PM
Novartis UK proposes reduction of its Horsham site operations while reaffirming to maintain respiratory research in the UK
• Proposals to restructure operations at Horsham site announced as part of ongoing review of global operations
• Novartis will continue to support its respiratory research group at its Horsham site in West Sussex
• Support to be provided to affected associates including redeployment, relocation and outplacement as appropriate
Horsham, March 16, 2011 – Novartis UK announced today that it will initiate consultation on proposals to restructure operations at its Horsham site in West Sussex while remaining committed to maintaining the site‟s respiratory research function. The proposals are part of the company‟s ongoing efforts to align resources to better respond to patients and customers in a challenging healthcare marketplace.
“Novartis is continuously evaluating its resource allocation to ensure that the organisation is highly flexible and able to proactively adapt to external challenges which best meet the needs of its customers,” said Sue Webb, General Manager, UK & Ireland and Country President. “With significant changes in healthcare systems aimed to contain or cut cost, this critical assessment and the subsequent potential changes to the Novartis UK organization are key to maintain significant investment in innovative drugs and our research efforts in the UK.”
Novartis continues to invest in both research and manufacturing in the UK. The respiratory research group, along with corresponding support functions, will remain in Horsham and the company will maintain its major manufacturing sites in Grimsby, Liverpool and Dundee. Novartis believes the environment for the pharmaceutical industry in the UK is a good one. We are collaborating with the government on a number of valuable initiatives to promote lifesciences research in the UK, including Clinical Research Networks, the Academic Health Science Centres and the Therapeutic Capability Clusters.
The Novartis Horsham site is a „campus‟ site shared by: Novartis Pharmaceuticals, Novartis Institutes for BioMedical Research (NIBR), and Novartis Consumer Health. There are approximately 950 full-time equivalent positions on the campus of which approximately 330 are dedicated to respiratory research.
Novartis is engaged with the UK Government to help proactively and positively manage the environment for the pharmaceutical industry in this country. The pharmaceutical manufacturing operations in Horsham are proposed to close and it is proposed to partially close the Global Development Site in Horsham, both with a potential exit over a two-year period.
While the Respiratory Clinical Development Franchise and Respiratory Research team has been recommended to stay in Horsham, other global line functions are recommended to exit. To further align with Global priorities, the gastrointestinal research teams are proposed to be co-located with teams in Basel and Cambridge over a 1-2 year period. Finally, to continue strategic alignment of business units in the UK, the Over-the-Counter operations are recommended to move to (or near to) the Novartis Frimley site, to further leverage integrated back office services.
The potential impact of these proposals will be subject to an employee consultation process and final Novartis UK board approval. Those employees whose roles are put at risk by the proposal will, if the proposal is accepted, be supported by Novartis through the process, with the identification of opportunities for redeployment or alternative positions and, where necessary, outplacement services among other assistance.