April 16, 2008 / 4:10 PM / 11 years ago

UPDATE 1-Lilly to cut up to 500 jobs in streamlining

(Adds details from announcement, share move)

NEW YORK, April 16 (Reuters) - Drugmaker Eli Lilly and Co (LLY.N) said on Wednesday it would cut up to 500 jobs as it streamlines manufacturing operations in its hometown of Indianapolis.

The voluntary exit program is expected to mainly affect workers in manufacturing, along with a small portion in selected areas of research and development.

The cuts involve sites that manufacture ingredients for the insulin products Humalog and Humulin and the osteoporosis medicine Forteo.

Lilly said it has cut its global work force by about 12 percent, or about 5,500 people, from peak employment levels reached in mid-2004, with the reductions coming mainly from attrition.

Most large drug makers have slashed jobs to cut costs as they face withering competition to top medicines and sluggish research productivity.

Lilly said it would take a yet-to-be-determined charge associated with the job cuts in the second quarter.

Lilly shares were up 34 cents at $51.89 in mid-day trade on the New York Stock Exchange. (Reporting by Lewis Krauskopf, editing by Gerald E. McCormick and John Wallace)

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