The parent of Canadian radioisotope supplier MDS Nordion is implementing a restructuring that will result in hundreds of job cuts in an effort to improve the company’s financial performance. MDS of Toronto said it was also planning to exit its generic radiopharmaceutical business located in Fleurus, Belgium.
MDS said that the generic radiopharmaceutical business is subject to increased regulatory standards, which would require a further investment not warranted by the future prospects of the business. MDS said it intends to continue to use the Fleurus operation to support the company’s remaining radioisotope business.
In addition, the company said that its U.S. diagnostics business has not met expectations for growth and profitability, and that it is taking steps to improve margins while examining the best way to participate in the market.
The changes will result in the elimination of 450-500 positions in the company, including 100 positions transferred to IBM, to whom MDS is outsourcing its information technology operations.
The various initiatives are expected to result in a pre-tax charge of $45 million to $55 million, Canadian ($34.3 million to $42 million, U.S.) in the fourth quarter. The company anticipates that these changes will result in savings of approximately $10 million, Canadian, ($7.6 million, U.S.) in 2004, growing to approximately $40 million, Canadian, ($30.5 million, U.S.) in 2005.
By AuntMinnie.com staff writersOctober 29, 2003
Related Reading
MDS records Q3 uptick in Life Sciences group, September 4, 2003
MDS Nordion inks licensing deal, August 12, 2003
MDS Nordion brings new cyclotron online, June 17, 2003
MDS sells oncology software unit to Delft, February 11, 2003
MDS Nordion gets regulatory approvals, July 11, 2002
Copyright © 2003 AuntMinnie.com
