HMR management and workers welcome deal

06 April 1998 00:00  [Source: ICB]

Both management and the works council of Hoechst Marion Roussel Deutschland (HMR) have expressed satisfaction with a pact signed last week to safeguard the Frankfurt R&D site.

The move follows Hoechst chairman J&uumlrgen Dormann's statement that HMR will try to achieve cuts without mandatory redundancies (ECN 2 February 1998). The deal, to take effect on 1 May, allows HMR to implement its new drug development concept while saving DM85m ($46.5m) in annual costs and reducing core staff from the current 1600 to 1100 without compulsory job losses.

HMR's original plan to cut DM95m in R&D costs and as many as 650 jobs at Frankfurt met massive resistance from the workforce and the regional political sector. Plans call for reorganisation of R&D into a new integrated organisation with overlapping work processes. To speed up drug development, project teams with more competence to implement findings will be created, HMR said.

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Initially, 1600 people will work in the new drug development (D I&A) segment, which replaces the previous research and development department. Between late 1998 and mid-1999 staffing is to be reduced to the agreed size. Management said some 290 jobs can be eliminated through natural wastage - around 90 jobs already have gone this way.

Around 160 service positions are to be transferred to other parts of HMR. Cell toxicology and parts of pharmacology staff working for outside companies will be set up as independent profit centres. Although HMR will retain some of the jobs it initially planned to eliminate, chief executive officer Heinz-Werner Meier said a saving of DM85m will be realised in 1999. Works council head Arnold Weber said employees had forced the company into 'important concessions'.

• Meanwhile, HMR has confirmed it has also signed a letter of intent to begin negotiations with Montedison subsidiary Antibioticos about a sale of its penicillin production at Frankfurt. It is also talking to Novartis group company Biochemie of Austria. The 40-year-old plant produces the active ingredient for HMR's penicillin drug Isocyllin. Its sales value is DM200m.
  
  

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