With a major part of its top line exposed to generic
) is looking towards cost-cutting initiatives to drive the bottom
line. The company is seeking to offset the impact of
genericization of key products by streamlining its cost
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AstraZeneca has announced proposals to shut down the Brixham
Environmental Laboratory, Devon, UK, which employs 71 people
directly by the end of Mar 2014. The site provides environmental
support services, which comprises assessment of pharmaceuticals
and chemicals used by a range of industries on the environment.
The company plans to get the services, currently provided by the
Brixham Environmental Laboratory, from third parties.
We note that the company initiated a major overhaul of its
research and development (R&D) segment in Mar 2013. As per
the proposed plans, the company's R&D activities will be
primarily centered in three facilities including the UK
(Cambridge), the U.S. (Gaithersburg) and Sweden (Mölndal). The
selling, general and administrative (SG&A) segment will also
be optimized. The initiative will result in the relocation and
termination of approximately 2,500 and 5,050 roles, respectively.
Besides streamlining its operations, AstraZeneca is focusing on
developing new treatments to make up for revenues lost due to
The company is working on bolstering its pipeline. It is also
looking at suitable acquisitions and deals. In a bid to add
late-stage candidates to its pipeline, AstraZeneca entered into a
number of acquisition deals (Pearl Therapeutics and Omthera
Pharmaceuticals) in the last few months and agreements with
companies such as FibroGen, Inc.
AstraZeneca, a large-cap pharma company, presently carries a
Zacks Rank #3 (Hold). Companies that currently look attractive
Johnson & Johnson
). While Roche is a Zacks Rank #1 (Strong Buy) stock, Johnson
& Johnson and Bayer are Zacks Rank #2 (Buy) stocks.