Alliance Boots will cut 200 jobs over the next two years at its manufacturing site in Nottingham so it can invest in better technology.
It is understood the pharmaceutical wholesale group which owns health and beauty retailer Boots, will cut 60 night time roles immediately from its BCM manufacturing business. It will redeploy jobs where possible.
The redundancies, which will incur a one-off £30m cost, are part of an ongoing review into the business which has recorded a reduction in volumes due to a drop in demand for contract manufacturing and an increase of regulatory compliance requirements.
Alliance Boots will also scrap “certain unprofitable areas of third-party manufacturing”.
Alex Gourlay, Alliance Boots chief executive of the health and beauty division, said: “By modernising and improving the efficiency of our Nottingham factory, we strengthen its position for the future and make it more suited to support the increasing global footprint of our product brands.
“It is an important step in our continued efforts to keep contract manufacturing in the UK, despite the ongoing challenges that the industry faces.”
Alliance Boots said it wants to refocus the business on activities where it has sustained a competitive advantage, including the group’s top skincare and beauty brands.
It is also expected to help the company invest in new product technologies to enable greater flexibility and support for Boots product development and will build “a stronger factory for the future”.
Alliance Boots believes this will better position the business to take advantage of growth opportunities overseas, including the US market.