Roche Plans Business Makeover

Swiss drugmaker Roche is to implement a major cost-cutting and business review "in view of mounting pressures to curb healthcare costs," according to a company press statement. The group-wide Operational Excellence Initiative, as the company is calling its new game plan, is intended to decrease costs while increasing effectiveness and productivity.

In the coming months, each company division will review and analyze its structures and processes and will announce details of its plan for change, including any potential impact on staffing levels. As of 2009, Roche employed more than 80,000 workers worldwide and invested nearly 10 billion Swiss francs in R&D - there is no word yet on how these numbers will change in light of the company's anticipated makeover.

The company has suffered a number of problems in recent months, including delays to its taspoglutide diabetes treatment and the failure of its rheumatoid arthritis ocrelizumab, that have seen its stock price fall by nearly 20% this year.

CEO Severin Schwan commented: "We have launched this initiative from a position of strength. By contrast with many of our competitors, we are only marginally affected by patent expiries. Furthermore, despite recent setbacks, we have one of the strongest research and development pipelines in the industry."

The Operational Excellence Initiative will be carried out during 2011 and 2012.