Lonza Streamlines Manufacturing

Lonza is restructuring operations because of economic pressures and cost reductions at its pharmaceutical customers. This year, the Swiss company will close its Conshohocken, Pa., active pharmaceutical ingredients facility; a vitamin K-3 plant in Shawinigan, Quebec; and a warehouse and offices for its biosciences business in Wokingham, England. The closures will impact 175 employees and cost about $140 million. Lonza expects the changes to achieve about 40% of the $60 million to $80 million in annual cost savings it earmarked in October 2009; the remainder will be achieved through routine cost-cutting measures, Chief Financial Officer Toralf Haag says. Lonza will transfer customer projects and activities from the three closed locations to other sites. Meanwhile, it will continue to build up capabilities at its new site in Nansha, China. “The closure of the three sites will help to optimize our global operational network and further increase the competitiveness for our customers,” CEO Stefan Borgas says. “The reengineering project is a key element in our endeavor to bring Lonza back to a sustainable growth.”