Biacore to Lay Off Quarter of Workforce as Part of Cost Cutting Plan

NEW YORK, Oct. 4 (GenomeWeb News) - Biacore International plans to lay off almost a quarter of its workforce, or 80 of its 345 employees, as part of a strategic business review, the Uppsala, Sweden-based company said today.

"The aggressive cost cutting plans that we have outlined are necessary to return Biacore to profitability in 2005 and to enable us to capture the growth opportunities that clearly exist for our current range of instruments," said Erik Wallden, Biacore's new president and CEO, in a company statement.

In particular, Biacore plans to cut R&D costs by SEK 55 million ($7.5 million) a year, mostly through laying off 30 of its 95 employees in this area and by cutting ties with some external consultants. In addition, the company will take an SEK 44 million ($6 million) write-down of the value of its array technology in the third quarter of 2004.

Biacore also plans to close its headquarters facility in Neuchatel, Switzerland, by mid-2005 in an attempt to improve its operating efficiency.

The company will charge SEK 36 million ($4.9 million) in one-time costs related to the layoffs to its fourth quarter earnings this year. Overall, it hopes to save approximately SEK 90 million ($12.2 million) a year by its cost-cutting measures.

As demanded by Swedish labor laws, Biacore will make its decisions final after negotiating with trade unions.