Eli Lilly's modernisation plan cuts 250 jobs in France

By Murielle Gonzalez | Published: 16-Jan-2019

The Fegersheim site will see a €100 million investment in new technology

Eli Lilly, the US pharmaceutical company, is investing heavily in strengthening its manufacturing capacity at home and abroad. Following the announcement of a US$8bn deal to acquire Loxo Oncology to push its cancer drug portfolio, the pharma giant said it also plans to modernise the Fegersheim site in France.

More than €100m will be invested to implement innovative technologies at the site. The project, however, will see 250 positions redundant. There are 1,400 workers currently employed at the plant and a voluntary exit programme, which that will be negotiated with the unions in France, has been scheduled to start in February 2019.

Fegersheim site is Eli Lilly’s biggest manufacturing site. Located in the Alsace region, the facility produces parenteral drugs in cartridges and vials, and injection devices used in the treatment of cancer, diabetes, osteoporosis and growth hormone deficiency.

Manufacturing infrastructure onsite includes sterile filling in cartridges using isolator technology, freeze-drying and assembly of injection pens for the pharmaceutical products.

Eli Lilly said the need for a transformation plan "is due to market pricing pressures that require more rigorous manufacturing cost management." The company also pointed out to the growing competition from additional diabetes products.

The multimillion-euro investment, implemented from now until the end of 2021, will see new technology at the site, such as new capabilities in digitally connected products. This is in addition to the €300 million invested over the last several years, the company said.

Cancer drug push

The acquisition of Loxo is Eli Lilly's biggest deal and it's aligned with the decision to focus on its human pharmaceutical business.

Based in Stamford, Connecticut, Loxo specialises in development and commercialisation of highly selective medicines for patients with genomically defined cancers.

Under the terms of the agreement, Lilly will commence a tender offer to acquire all outstanding shares of Loxo Oncology for a purchase price of $235.00 per share in cash, or approximately $8 billion.

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