Healthcare manufacturer Johnson & Johnson today announced that it will cut around 3,000 jobs, or 4 to 6% of its global medical devices workforce, as part of a restructuring that the company says will make that division more globally competitive.
Gary Pruden, Worldwide Chairman of Johnson & Johnson Medical Devices, in a statement called the move “bold” and said it was necessary to “evolve our offerings, structure and footprint and increase our investment in innovation.”
Pruden acknowledged “the changing needs of the global medical device market” and said the move would keep costs competitive and ultimately make the business more profitable and free up more funds to invest “in new growth opportunities and innovative solutions for customers and patients.”
The company said the actions would add up to annualized pre-tax cost savings of $800 million to $1.0 billion, “the majority of which is expected to be realized by the end of 2018, including approximately $200 million in 2016.”
Additional information regarding today’s announcement can be found in the FAQ posted on www.investor.jnj.com/MDFAQ. Further commentary will be provided during the company’s fourth quarter earnings conference call scheduled for January 26, 2016.
Johnson & Johnson’s Consumer Medical Devices businesses, Vision Care and Diabetes Care, will not be affected by the layoffs, the company said.
The Medical Devices segment products are used primarily by health care professionals in orthopaedics, neurovascular, surgery, diabetes care, infection prevention, cardiovascular disease, vision care, sports medicine, and aesthetics.