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Johnson & Johnson announces restructuring of medical devices businesses
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Johnson & Johnson has announced restructuring actions for its medical devices businesses.
According to a company press release, the actions will result in position eliminations for approximately 4% to 6% of the Medical Devices segment’s global workforce during the next 2 years.
The steps are needed to strengthen its go-to-market model, accelerate the pace of innovation, further prioritize key platforms and geographies and streamline operations, according to the release. The company expects an annualized pre-tax cost savings of $800 million to $1 billion which will provide added flexibility and resources to fund investments in new growth opportunities and innovative solutions for customers and patients. The majority of the cost savings is expected by the end of 2018. In addition, pre-tax restructuring charges of approximately $2 billion to $2.4 million are expected with approximately $600 million anticipated in the fourth quarter of 2015.
“As a market leader, we are committed to leveraging our breadth and scale to shape the future of the medical device industry, for the benefit of those we serve,” Gary Pruden, worldwide chairman of Johnson & Johnson Medical Devices, said in the release. “The bold steps we are taking are to evolve our offerings, structure and footprint and increase our investment in innovation. These actions recognize the changing needs of the global medical device market and will deliver more value to customers, increasing our competitive advantage and driving growth and profitability for our business.”
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