Argentina’s drugmakers cannot escape the country’s recession. Pharmabiz has learned that TRB Pharma has begun crisis prevention measures cutting 10% of its workforce.
Argentina’s pharma sector is feeling the heat of the country’s prolonged recession and economic crisis as local drugmaker TRB Pharma announces a 10% cut to its workforce.
The cuts are being made under Argentina’s so-called Procedimientos Preventivos de Crisis (PPC) – crisis prevention procedures that allow companies to take measures to avoid folding. The use of these procedures is on the up owing to the ongoing situation of recession coupled with high inflation. Just this week Coca Cola-FEMSA presented a request to use the procedure at its plant in Pompeya, Buenos Aires, joining a growing number of companies on the list.
Other major Argentine companies to resort to the procedure include tyre company Fate and aluminum giant Aluar. Several more are joining the list this southern hemisphere summer according to local journalist Alejandro Rebossio. See article in Spanish.
The pharma sector is applying to use the same procedure requested by the likes of Coca Cola-FEMSA and Fate. A precedent in the sector was set by national drugmaker Craveri, whose move to cut staff at its plant was broken by Pharmabiz in November.
Pharmabiz has learned that a PPC process has been launched by national lab TRB Pharma, which has already announced a cut of 10% of its workforce, which comprises 350 employees in Argentina. According to information seen by Pharmabiz, cuts are mainly being applied at the drugmaker’s plant in the district of Pilar and across its sales team.
Pharmabiz has seen the official legal notice issued to the staff who have been laid off, in which the company argues that the move was necessary on entering the PPC process because of the «economic context and a 50% devaluation of the Argentine peso against the US dollar in only eight months.» It also stated that «90% of the company’s revenue was in pesos, while 80% of supplies were purchased in dollars«. See official notice.
TRB Pharma defines itself as a subsidiary of Swiss company TRB Chemedica, but for close to 26 years, the Argentine company has been led by the Romanenghi family and 70% of its portfolio is of local origin.
TRB Pharma is a rare bird. It defines itself as a subsidiary of Swiss company TRB Chemedica, but going against the trend at the multis, who rotate their main leaders in the country every four years, TRB Pharma Argentina has been run by the Romanenghi family for close to 26 years. Founder Lorenzo Romanenghi is an ex-Pfizer man with participation in the company, although Pharmabiz has never been able to gain a clear explanation of the stake. Around 70% of the company’s portfolio is of local origin – productos brought together by Romanenghi himself.
One such product is the line of analgesics Matrix which the company managed to sell to Mexico’s Genomma in 2013, gaining the funds to build its own plant in Pilar, Greater Buenos Aires, focusing on oral solids and replacing a plant in Buenos Aires City which burned down in 2011. See article.
The tool of the PPC is proving to be a savior for companies with financial problems and is proving ever more in demand since it allows companies to offer half the usual legal compensation for layoffs. Fate CEO Javier Madanes Quintanilla told newspaper Perfil that the company was resorting to the instrument because of «a systematic deterioration in the economic equations over the last three years. There are productivity problems in a context that has been worsened by increases in export costs and a sharp fall in the internal market«. See article in Spanish.