H. Lundbeck will eliminate 180 to 200 positions over the next two years as part of a restructuring of its business services operations within its Fit-for-the-Future companywide overhaul.
Lundbeck said it plans to restructure its European business services by consolidating more than 30 affiliates into 10 business units, as well as by establishing a business service center in Poland. The company will set aside DKK 200 million ($36.3 million) toward all Fit-for-the-Future initiatives, though Lundbeck cautioned that final estimates for the cost of the program as well as benefits are subject to completion of consultation processes with relevant work councils.
"Lundbeck remains fully committed to our long-term strategy, and over the years we have taken decisive steps in order to improve our organizational efficiencies and our ability to succeed in a changing environment,” Anders Götzsche, EVP and CFO at Lundbeck, said in a statement. "We are very aware that these initiatives affect many employees, and we will strive to mitigate any negative effects these might have.”
The company added that Fit-for-the-Future will generate DKK 500 million ($90.7 million) in annual savings when fully implemented in 2016.
Under Fit-for-the-Future, launched June 20 and set to run through 2015, Lundbeck will divide its commercial operations into six parts: Europe, the United States, Canada, Asia, Latin America, and Middle East & Global Distribution. The division is designed to reflect the company’s global diversification and to ensure it will focus fully on growth markets.
According to Lundbeck, Fit-for-the-Future consists of initiatives to optimize and standardize administrative processes, reduce supply chain complexity, ensure even more effective execution of clinical trials, structure procurement, and decrease spending on less critical activities. The overhaul’s overall goals include reducing complexity, increasing organizational efficiency, and freeing up resources for corporate priorities.