Siemens Healthineers has announced plans to shut down its Fast Track Diagnostics unit, affecting 90 jobs in a move the company blames on a post-Covid-19 decline in diagnostics demand.
The Germany-based healthcare firm will now no longer be producing some of the polymerase chain reaction (PCR) testing products previously bound for the general European market and intends to shut the unit down by the end of September of this year.
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Whilst the company has confirmed that 90 jobs will be affected, mostly based out of facilities in Luxembourg, it has not announced lay-offs. The move comes as part of a wider company-wide restructuring effort. In November 2023 Siemens laid off as many as 300 members of staff from its diagnostics and manufacturing division based out of Flanders, New Jersey.
Siemens Healthineers has said that its fast-track diagnostics unit represents only a fraction of its overall diagnostics business. GlobalData’s Medical Device Intelligence Centre details that Siemens Healthineers comprises 5.4% of the tracked global in vitro diagnostics market, seeing an annual revenue of approximately $2.6bn.
However, financial reports published by the company over the past three years detail how the Fast Track Diagnostics unit brought in approximately €37m ($40.1) for the company in 2021 followed by €35m ($38m) in 2022, before dropping to €14m ($15.2) in 2023.
GlobaData Analyst, Selena Yu, elaborated how this move may end up being beneficial for the company as they shutter services that were profitable during the Covid-19 pandemic and pivot more towards more financially viable assays and point-of-care testing, as well as ensuring that their test analysis devices can work across multiple indications.
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By GlobalDataYu said: “This move means that they are also moving away from the academic research use only space and pivoting into a much more clinical area of sales so that more of the tests that Siemens spends resources developing can be used in patient populations.
“For example, they are remaining strong in the field of haematology. When it comes to haematology analysers they are in the top third of companies, so I think based on their testing portfolio and their push towards innovation to build more tests for their analysers.”
