More job cuts are coming at Boston Scientific ($BSX), Reuters reports. And acting CEO Hank Kucheman will separate the two main divisions of its cardiac device business, the company's biggest sector.
Boston Scientific did not disclose details about the number of layoffs coming this time, or when they would take place. But company spokesman Steven Campanini told FierceMedicalDevices that the company is "implementing steps to align its workforce and operations with the company's global initiative to operate more cost effectively." Reuters, which broke the story, reports that the specific layoffs will be announced within the next two months.
Campanini confirmed that the layoffs are part of a larger restructuring effort announced in July 2011. Back then, the struggling medical device giant said it would slash 1,400 jobs by the end of 2013 to save $275 million in costs, both through employee attrition and layoffs. At the same time, Boston Scientific, now with 24,000 employees (about 1,000 fewer than a year ago), said it would add 1,000 new jobs in China over the next 5 years as it expands in that country. A spokesman told Reuters, meanwhile, that some of the latest job cuts would result from manufacturing adjustments both in the U.S. and overseas.
Campanini would not comment on moves to split the company's cardiac arm into two divisions. But an anonymous source told Reuters that Kucheman explained some of the details in a letter to employees earlier this month. Such a move to divide the company's cardiac division would undo changes put into place by former CEO Raymond Elliott. He merged the company's cardiac rhythm management unit (heart pacemakers and implantable defibrillators) with its interventional cardiology business (stents) three years ago, Reuters notes. But the change would restore the previous status quo.
As Reuters points out, Boston Scientific hasn't been the same since its massive acquisition of heart stent maker Guidant in 2006, which forced it to take on substantial debt. Under Elliott, Boston Sci reduced debt, restructure and eliminate about 2,000 jobs, the story notes.
Boston Scientific continues to face plunging sales for its cardiac rhythm management and interventional cardiology business lines. But Kucheman told FierceMedicalDevices in July that the company's reorganizational moves will begin to pay off within the next 12 to 18 months.
- read the Reuters story
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