Boehringer follows Sanofi with job cuts in France

Boehringer Ingelheim has confirmed it plans to axe more than 10% of its workforce in France, or more than 300 jobs, adding to several hundred losses at Sanofi last week.

The privately-held German drugmaker says it will eliminate 327 positions – 197 in human health and 130 in its animal health unit – a move which comes just under two years after it acquired Sanofi’s animal health unit Merial in exchange for its consumer health division.

All told, Boehringer employs 2,800 employees in France across both divisions, and it also says 32 new jobs will be created while 180 workers will have their contracts altered, mainly in connection with relocation to other sites within France. One of the key moves will be a consolidation of support functions at a single site in Lyon.

Last week, the CGT trade union revealed that Sanofi are planning to cut 670 jobs in France by 2020 that will affect functions such as human resources, IT, legal, and finances, with another 80 IT jobs set to be outsourced. Sanofi has said it also intends to recruit 250 people in France for new positions in areas such as bioproduction and digital.

In a statement, Boehringer’s French subsidiary said that the drive is a response to the Merial acquisition as well as to remain competitive in an “increasingly constrained market…particularly in human health.” The announcement comes as a moratorium on job losses agreed when the Merial takeover was negotiated comes to an end.

In fact, human health is very much bearing the brunt of the cuts both in numerical terms and proportionally, as that business employs 514 people at the moment and will be reduced by almost 39%. The head of the French unit, Jean Scheftsik de Szolnok, told Agence France Presse (AFP) that in the last two years turnover for the human health unit has fallen 18%, in part because of reductions in the reimbursable price of medicines, and also that two thirds of the cuts will come among pharma sales reps.

Boehringer has been working to cut costs around the world over the last couple of years after losing patent protection for flagship respiratory drug Spiriva (tiotropium). In 2016 for example it announced plans to reduce its US workforce by around 725, with a further 120 cuts unveiled later that year.

Meanwhile, at the same time it has been making a series of bolt-on acquisitions to boost its R&D pipeline, including a series of immuno-oncology deals, and also exited some businesses including biosimilars outside the US.

That includes a €210 million takeover of oncolytic virus company ViraTherapeutics in September, a €1.1 billion deal to license a checkpoint inhibitor from French biotech OSE Immunotherapeutics, as well as earlier alliances with Siamab, AbeXXa Biologics, CureVac and Philogen.