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500 jobs to go as Novartis plans to shutter NY Diovan facility

By Dan Stanton , 22-Jan-2014
Last updated on 22-Jan-2014 at 13:39 GMT

Novartis says it intends to shutter a New York manufacturing site due to reduced demand following the loss of exclusivity on its one-time topseller Diovan.

The Suffern, New York facility is a major producer of one-time blockbuster blood pressure drug Diovan (valsartan). However, due to its loss of US exclusivity in September 2012, Novartis announced yesterday it was to shutter the plant.

“Changes in our current portfolio, namely the loss of exclusivity of Diovan, have significantly reduced the future production demand on the Suffern, NY site,” Novartis spokeswoman Anja von Treskow told in-Pharmatechnologist.com.

“Consequently the site’s future volumes would be significantly below the minimum required to operate it cost effectively.”

Net sales of Novartis’ blood pressure drug Diovan (valsartan) stood at $5.7bn (€4.2bn) worldwide in 2011, but the following September the drug’s patent expired in the US and overall sales fell by 22% for the year, according to regulatory filings .

Jobs

The 48,000m2 plant, which makes a number of other Novartis products, will start to close its doors in the second quarter of 2014 and will be completed over the next three years, she added, with all 525 employees at the site set to be affected by the news.

“All impacted associates will be treated fairly and with respect,” she said, and “where possible associates will be redeployed to other Novartis sites.”

The Swiss company had already cut over 1,600 positions from its field force in January 2012 ahead of the patent expiration.

Like other Big Pharma – including Merck & Co. and Pfizer – Novartis is continually reviewing its manufacturing infrastructure and capacity in order to deal with products going off patent and ever-changing pipelines and requirements.

For Novartis: These on-going evaluations of our manufacturing network forms part of our global strategy to create designated Manufacturing Centers of Excellence worldwide to better support the future Novartis product supply chain and maximize our productivity,” von Treskow said.

Swiss restructure

The Suffern announcement was accompanied by further news relating to Novartis jobs, this time in Switzerland, where the firm plans to “shift and streamline resources” in order to support planned 2014 launches of respiratory, lung cancer, dermatology and heart disease drugs.

Though several hundred jobs will be added to areas such as oncology development, OTC manufacturing and supply chain management for its generics subsidiary Sandoz, the firm will cut up to 500 jobs to support this, mainly in headquarter support functions and in operational roles in pharmaceuticals development.

However, Novartis says the overall headcount in Switzerland will remain stable, at around 15,000.

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