Vas Narasimhan, Novartis CEO, explains reasons behind 2,100 jobs cut

Novartis new CEO Vas Narasimhan has given a long interview to the Swiss daily Basler Zeitung today. The interview has been almost entirely focused on the cut of approximately 2,100 jobs, announced by the Swiss multinational’s management two days ago. Vas Narasimhan has stated that it was immediately clear to him and his new management that Novartis’ Technical Operations unit, with 28,000 employees in 66 sites spread over 26 countries, was too large and needed to be reorganized, so the announcement is a direct result of this early analysis. The Indo-American manager has added that, despite the $10bn profit, his group must increase its EBITDA, which is 30% now, while the average in the sector is approximately 35%. The 35% EBITDA target may be reached as early as 2022, Narasimhan has said.

Novartis will maintain its strong presence in Switzerland. Indeed, despite the massive reorganization plan, 10% of the company’s workforce is employed in Switzerland, and the Swiss market will further grow in importance as Alcon’s headquarters are moved from the US to Switzerland.  However, Novartis expects support by Swiss politicians, in order for the market to remain attractive and competitive.

(Source: Basler Zeitung)