June 14, 2012 / 1:15 PM / 8 years ago

UPDATE 1-Lundbeck to cut 600 jobs in Europe

* Restructuring costs of up to 500 mln Danish crowns

* Faced with patent expiry, healthcare reforms, competition

* Shares down 0.1 pct, outperform Danish index

By Mette Fraende

COPENHAGEN, June 14 (Reuters) - Danish drugmaker Lundbeck is to axe around 600 jobs in Europe as it looks to cut costs to cope with the patent expiry of a key antidepressant, pressure from cutbacks in government healthcare spending, and cheap generic competition.

Lundbeck said on Thursday it would book restructuring charges of up to 500 million Danish crowns ($85 million) from revamping its commercial organisation in Europe. It did not give an estimate of the expected savings.

“The market environment in Europe is changing rapidly at a time when Lundbeck has numerous new products to launch,” chief executive Ulf Wiinberg said.

“To ensure a successful transition of our product portfolio in Europe we need a more flexible commercial infrastructure and to maintain cost control,” Wiinberg said.

The exact restructuring costs were uncertain, Lundbeck said, adding it was maintaining its previous guidance for 2012 earnings before interest, tax, deprecation and amortisation (EBITDA) and EBIT before restructuring costs.

Lundbeck is trying to find replacements for its key antidepressant Cipralex - sold as Lexapro in the United States and Japan - which is losing patent protection.

Last month, the company missed first-quarter profit forecasts due largely to a faster-than-expected slide in sales of its top-selling antidepressant, while at the same time it invested in new drugs.

Lundbeck has warned group earnings will stall until 2015 as it goes through a transition of getting new drugs into the market to replace Cipralex sales.

New drugs like Ebixa for Alzheimer’s disease, as well as a string of soon-to-be launched treatments, will pick up the slack, the company has said.

Shares in Lundbeck were down 0.1 percent at 121.30 crowns at 1200 GMT, holding up better than the Copenhagen stock exchange’s benchmark index which was down 0.9 percent.

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