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Lonza rejigs ops and says more changes are to follow

By Gareth Macdonald , 05-Feb-2013
Last updated on 06-Feb-2013 at 09:51 GMT

Lonza has reorganised its operations into two new divisions – Pharma and Specialty ingredients – and says more changes are on the way.

The move will see Lonza’s custom manufacturing business merge with its biosciences arm under the Pharma markets banner and its life science ingredients and microbial control divisions combine to form a specialty ingredients unit.

CEO Richard Ridinger said that establishing the two units – which will be led by exec committee members Stephan Kutzer and Beat In-Albon – is designed to cater for Lonza’s core markets.

He also said that: “Following these changes at the top level management we will gradually roll out subsequent organizational changes throughout the company,” adding that “we will create a lean organization focused on improving efficiency and profitability with dedicated market orientation.”

News of the new organizational structure follows just a week after the Swiss ingredients firm hinted it may reduce production capacity as part of an ongoing review of its manufacturing footprint .

At the time Ridinger said he was happy with the life science ingredients and bioscience division but unsatisfied with the EBIT performance of the custom manufacturing division.

The firm later told us that costs associated with its new facility in Singapore and spending need to address quality issues at its active pharmaceutical ingredient (API) production plant in Hopkinton, Massachusetts, US reduced profits in 2012.

in-Pharmatechnologist.com asked Lonza if any of the ‘subsequent organisational changes’ prompted by the new structure will involve job cuts, but the firm did not respond ahead of publication.

Previously efficiency drives have seen Lonza reduce its workforce. In August last year the firm hired Beat in-Albon – chief of the new specialty ingredients unit - to try and make its API plant in Visp, Switzerland more competitive and profitable .

In-Albon’s response to the so called ‘Visp Challenge’ was to increase the amount of high-value manufacturing products undertaken at the facility and announce plans reduce Lonza’s headcount by 400 employees over the next two years.

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