17 January 2012 - Swiss Novartis (VTX:NOVN) dropped its plans to shut down its site in Swiss Nyon, Pascal Brenneisen, head of the company's Swiss operations, told media on Tuesday.

Novartis unveiled in October 2011 it will axe 2,000 jobs worldwide seeking annual savings of approximately USD200m (EUR157.1m). The drug major intended to close its plant with 320 workers in Nyon and to cut 760 jobs in Basel.

Novartis now said it will not dismiss any employees in Nyon and the layoffs in Basel will be reduced by two thirds. The company will provide new positions for one-third of the affected Basel staff and will offer an early retirement to another third.

Regarding Nyon, the affected parties proposed to Novartis measures such as a decrease in fixed costs and cantonal tax relief. The personnel is ready to forgo part of agreed salary hike for 2012. The weekly working hours will be increased to 40 from 37.5.

Novartis, on its part, will invest a "significant" amount in the modernisation of the production facilities and their approval by the US Food and Drug Administration (FDA).

The company's decision to keep the Nyon site will not affect other locations.

Last week, Novartis said it will downsize its US staff by 1,960 due to a patent protection expiry for high blood pressure medicine Diovan (valsartan) and discouraging sales prospects for another hypertension drug, Rasilez/Tekturna (aliskiren).

(USD 1.0 = EUR 0.786)