Reorganisation of Bayer Schering Pharma r&d activities to cost 800 US jobs

The structure of Bayer Schering Pharma's global research and development organisation has been defined and a reorganisation of the US sites has been initiated. Research programmes and activities will be consolidated into three major r&d sites: Berlin and Wuppertal in Germany and Berkeley in California, US.

The Berlin research group will take leadership for diagnostic imaging, oncology and gynecology/andrology research, and Wuppertal will be core for the company's cardiology research. Both locations have significant capabilities and activities in target discovery, lead generation and optimization, drug metabolism and pharmacokinetics, toxicology and clinical pharmacology.

Berkeley will remain an important global r&d centre for protein-based biologics drug discovery and will continue to be home to the Kogenate biological manufacturing facility. This facility is expected to become a research centre of excellence and anchor for continuing work in hematology as well as in immunology and inflammation.

Bayer HealthCare's US research site in West Haven, Connecticut, and that of Berlex (US subsidiary of Schering) in Richmond, California, will be closed. Bayer Pharma will relocate remaining departments and functions presently based in West Haven into headquarters locations in New Jersey.

The consolidation of research activities is expected to be largely complete by the end of the first half of 2007 and will result in the loss of approximately 600 US jobs, primarily in research. Over time it is anticipated to eliminate an additional 200 US-based positions by the overall reorganisation. The company expects to achieve overall r&d cost-savings in excess of US$210m per year by the end of 2008. Synergies totaling Euro 700m ($544m) are expected to be achieved from 2009.