Schering-Plough Restructures Manufacturing Operations

June 2, 2006
Patricia Van Arnum

Patricia Van Arnum was executive editor of Pharmaceutical Technology.

ePT--the Electronic Newsletter of Pharmaceutical Technology

Schering-Plough Corporation (Kenilworth, NJ) announced plans to phase out manufacturing operations at its Manati, Puerto Rico site, expecting to discontinue operations there by the end of 2006.

Schering-Plough Corporation (Kenilworth, NJ, www.schering-plough.com)announced plans to phase out manufacturing operations at its Manati,Puerto Rico site, expecting to discontinue operations there by the endof 2006. The company also will reduce its workforce at manufacturingfacilities in Las Piedras, Puerto Rico and in Kenilworth and Union, NewJersey.

The actions will eliminate roughly 1100 positions, primarily in 2006.Approximately 600 regular, full-time positions will be eliminated inPuerto Rico, including 550 in Manati and 50 in Las Piedras.Schering-Plough expects to continue to employ roughly 475 people in LasPiedras. The company also will eliminate 500 regular, full-timepositions in Kenilworth and Union.

Schering-Plough expects these actions to generate annual costreductions of $100 million in 2007. Total expenses associated withthese actions will be between $235-260 million: $60-70 million forseverance; $85 million for fixed asset and inventory write-offs; and$90-105 million for accelerated depreciation and closure costs. Thecompany will incur $130 million of these expenses in the second quarterof 2006, with the balance in the second half of 2006.

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