AstraZeneca launches overhaul to cut costs by £1.1bn a year

Pharmaceutical firm AstraZeneca has unveiled plans to slash costs by 1.5 billion US dollars (£1.1 billion) a year as part of a major restructuring to boost investment in its new drug pipeline.

The London-listed group said the three-year overhaul would cost it up to two billion dollars (£1.5 billion) in restructuring charges, but declined to provide details on where the savings would come from and whether jobs would be impacted.

Anglo-Swedish AstraZeneca employs 100,000 workers globally, of which around 10,000 are based in the UK.

Its global headquarters are in Cambridge, with other UK sites including research and development (R&D) and manufacturing bases in Macclesfield, Cheshire, as well as sites in London and Speke, Liverpool.

The group said: “The company has initiated the ‘reshaping for sustainable growth’ programme to create additional capacity to invest behind its industry-leading pipeline and transformative technologies.

“Over the next three years, the programme will redeploy resources and strengthen capabilities across AstraZeneca’s existing business and therapy areas.”

It added: “The savings generated will continue to be reinvested back into the company, principally in the pipeline.”

Details of the cost-cutting targets came as it reported better-than-predicted profits for the third quarter, with pre-tax profits jumping 22% higher to 3.96 billion dollars (£2.9 billion).

Operating profits also rose 22% to 4.39 billion dollars (£3.21 billion).

AstraZeneca is ramping up new drug development, with more than 180 projects in the pipeline, as it looks to meet a target to reach 80 billion dollars (£58.8 billion) in annual sales by 2030.

It is expecting to underpin this with about 20 new medicine launches.

Pascal Soriot, chief executive of AstraZeneca, said: “With multiple potential blockbuster assets in late-stage development and transformative technologies scaling rapidly, we are on track to deliver our 2030 ambition and to sustain growth through the next decade.”