DSM Seeks Partner In Antibiotics

DSM has completed a strategic review of its anti-infectives business by concluding that it needs to find partners for the operation that are based in countries with low production costs, such as China, India, and Mexico.

At the same time, the company says it will continue to restructure its own business by shifting production of antibiotic side chains from Spain to China and possibly divesting certain business segments, such as the clavulanic acid operation.

It expects to cut 100 jobs in the process and take a restructuring charge of more than $20 million. As a result of these changes, the company expects to report a profit in its anti-infectives business in 2008 after years of losses due to competition from lower cost competitors.

DSM says it continues to negotiate a partnership with North China Pharmaceutical for antibiotic production in China. The partnership has been slow to materialize: The company first announced plans for it in late 2004.