AMRI cuts US jobs and focuses on Asia
Aims to save costs while meeting rising demand from Far East
Albany Molecular Research (AMRI) is reducing its US workforce by 10% with the loss of 80 jobs as part of its strategy to increase global competitiveness and meet a continued shift in demand from customers for services in Asia and Europe. The company expects these job cuts will result in an estimated US$4m in savings.
The contract research operation is also suspending operations at one of its research laboratory facilities in Rensselaer, New York. Employees and equipment will be consolidated into nearby AMRI locations. As a result of this action, the company expects to take a restructuring charge of US$3–5m in the second quarter of 2010.
AMRI is pushing ahead with plans to expand in Asia and will invest in excess of US$30m in its international facilities and hire 180 people in India and Singapore.
AMRI chief executive Thomas D'Ambra said: ‘These actions reflect the focus by our customers on cost of services amid a highly competitive environment coming primarily from Asia. This has led to a continued shift in demand for AMRI’s services from the US to lower cost resources in Asia and Europe.’
While AMRI remains ‘cautiously optimistic’ about a return in demand for contract research outsourcing by the biopharmaceutical industry, D’Ambra said softness in the US market has extended beyond expectations.
‘The actions we are taking are part of our on-going commitment to manage costs tightly while also managing our infrastructure to support future growth and development,’ he added.
AMRI chief financial officer Mark Frost said AMRI remains financially sound. ‘The decision to reduce our structure in the US was difficult, but after exhausting all other options, we believe necessary to achieve our longer term success,’ he said.
For 2010, the company is expecting an increase in contract revenue of up to 13%, compared with 2009.