OR WAIT 15 SECS
Amgen announced it would cut 2200–2600 jobs as part of a plan to increase operational efficiencies.
Thousand Oaks, CA (Aug. 15)-Amgen announced it would cut 2200–2600 jobs as part of a plan to increase operational efficiencies. The job cuts are the first ever for the company and will result in a 12–14% staff reduction. Amgen’s plan also includes closing certain production operations and reducing planned capital expenditures by approximately $1.9 billion during 2007–2008.
Kevin Sharer, Amgen’s chairman and chief executive officer, stated, “Recent changes in coverage rules and adjustments to Amgen’s FDA-approved labels for ‘Epogen’ and ‘Aranesp’ have and will adversely affect Amgen’s revenue. The initiatives announced today respond to that new reality by taking account of reduced revenues and appropriately lowering costs across the company.”
The company also changed its adjusted earnings per share guidance for 2007 from $4.28 to $4.13–4.23, excluding restructuring charges. The change results from low sales of Amgen’s “Aranesp” drug.
Amgen expects its initiatives to be completed by 2008 and to generate $1.0–1.3 billion in pretax savings. The cumulative pretax restructuring charges associated with these changes are expected to be $600–700 million in 2007 and 2008, including $289 million for asset impairment and related costs reported in the second quarter of 2008.
The company said it would implement the initiatives in a way that maintains its responsiveness to customers and patients. Amgen also stated it would treat its staff fairly and minimize the workforce reduction’s impact on its employees by using attrition, hiring freezes, and a voluntary transition program. Affected staff will receive career counseling assistance in securing new employment.