Johnson & Johnson to Layoff 1,000 Workers
Johnson & Johnson to Layoff 1,000
Workers
Johnson & Johnson announced on Wednesday that it will close two factories and layoff as many as 1,000 workers as part of a new restructuring plan. The moves pertain to the company stopping production of heart stents coated with Cypher at two factories and halting the development of a new model. The New Brunswick, New Jersey-based company said it will cease production on the stents by the end of the year, and the restructuring will force the company to take charges totaling $1.1 billion this quarter.
The world's largest manufacturer of health-related products, J&J has lost ground in the $4 billion-per-year global market for heart stents, devices used to prop open clogged arteries, to rivals Abbot Laboratories and Boston Scientific Corp. J&J's Cordis unit sold $627 million worth of stents in 2010, well off the $919 million worth it sold in 2009 and just a fraction of the $2.62 billion it sold in 2006.
“ Due to evolving market dynamics in the drug-eluting stent business, we see greater opportunities to benefit patients and grow our business in other areas of the cardiovascular device market,” said the chairman of Cordis, Seth Fischer. He did say that the division wold remain in other markets, and “we will continue to bring innovative cardiovascular solutions to patients in the future,” he said. J&J will close plants in Cashel, Ireland and San German, Puerto Rice, where the stents are made, and will cease development on Nevo, a next-generation stent whose clinical trials have been delayed.
Johnson & Johnson announced on Wednesday that it will close two factories and layoff as many as 1,000 workers as part of a new restructuring plan. The moves pertain to the company stopping production of heart stents coated with Cypher at two factories and halting the development of a new model. The New Brunswick, New Jersey-based company said it will cease production on the stents by the end of the year, and the restructuring will force the company to take charges totaling $1.1 billion this quarter.
The world's largest manufacturer of health-related products, J&J has lost ground in the $4 billion-per-year global market for heart stents, devices used to prop open clogged arteries, to rivals Abbot Laboratories and Boston Scientific Corp. J&J's Cordis unit sold $627 million worth of stents in 2010, well off the $919 million worth it sold in 2009 and just a fraction of the $2.62 billion it sold in 2006.
“ Due to evolving market dynamics in the drug-eluting stent business, we see greater opportunities to benefit patients and grow our business in other areas of the cardiovascular device market,” said the chairman of Cordis, Seth Fischer. He did say that the division wold remain in other markets, and “we will continue to bring innovative cardiovascular solutions to patients in the future,” he said. J&J will close plants in Cashel, Ireland and San German, Puerto Rice, where the stents are made, and will cease development on Nevo, a next-generation stent whose clinical trials have been delayed.
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