ESTEVE RESTRUCTURES ITS PHARMACEUTICAL ACTIVITY TO BE MORE COMPETITIVE
The last 4 Royal Decrees have had a significant impact on the pharmaceutical market, resulting in financial losses and major margin drops.
The pharmaceutical company announces the launch of a Strategic Plan and a labor force adjustment plan in one of the Group's companies: Laboratorios Dr. Esteve, S.A.
The other Group activities: Esteve Química (fine chemicals) and Pensa Pharma (generics) will keep on pressing on with the internationalization process.
The severe economic crisis, the successive sector regulations and constraints to contain pharmaceutical spending and the market contraction back to 2005 levels have forced Grupo ESTEVE to reconsider its pharmaceutical activity in order to guarantee its future competitiveness and sustainability.
Consequently, Laboratorios Dr. Esteve, S.A. (LDE), the company responsible for the Group's pharmaceutical activity, has announced the launch of a Strategic Plan and the presentation of a labor force adjustment plan which will result in the termination of up to 225 jobs of the 1440 employments of this unity (15% of total company employees). This long thought decision meets the objective of adjusting LDE's dimensions to the new market reality.
At this moment, the company's management has already opened negotiations with the legal employees' representatives, hoping this will lead to an agreement that will be satisfactory for both parts.
Two years ago, the company launched a stern austerity plan that included a reduction of spending and investments, as well as the implementation of non-traumatic measures on the pharmaceutical activity such as labor force adjustments and termination of temp jobs in order to adapt the organization to production and margin drops. However, these measures did not suffice and the profits generated by the other two Group activities, fine chemicals and generics, could not make up for LDE's losses 56 million Euros of a total revenue of 412 million in 2012.
The Strategic Plan joins the rest of initiatives deployed to bring LDE back to generating profits and growth. This Plan, which started with the implementation of a new commercial model in Spain, contemplates the constant improvement of operational and process efficiency, and also foresees the medium term incorporation of several new products to the company's portfolio.
The Labor Force Adjustment Plan announced today will only affect Laboratorios Dr. Esteve, S.A. The other main companies of the Group Esteve Química and Pensa Pharma, fine chemicals and generics respectively will continue their current efforts to progress, consolidating their strong position on the market, specially on the international area.
ESTEVE (www.esteve.com) is a Spanish chemical-pharmaceutical group and has a strong international presence. With a turnover of 792 M (in 2012) and a global workforce of 2,538 people, maintains a firm commitment to excellence in the healthcare setting and has used its best efforts to promote health and improve people's quality of life. Research being ESTEVE's hallmark, a portfolio of highly innovating products aims to provide responses to unmet medical needs
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