In the wake of contractual disruptions and US regulatory issues, 134 jobs are on the line at Aspen Pharmacare’s production facilities in Gqeberha.
The company has started a formal consultation process under sections 189(3) and 189A of the Labour Relations Act.
This follows the closure of its eyedrop production facility, prompted by findings from the US Food and Drug Administration (FDA).
The anticipated layoffs could take place by July 31.
The company employs 2,703 people.
In the section 189(3) and 189A notice sent out on Thursday, Aspen SA operations executive general manager Branson Bosman said significant external and internal developments had materially affected Aspen’s ability to sustain its operating model and workforce structure.
“In October 2024, preliminary findings from a regulatory inspection conducted by the FDA necessitated the immediate suspension of the company’s eyedrop production lines,” he wrote.
“Though Aspen proactively sought to mitigate the impact of this disruption by temporarily redeploying the 134 affected employees to other areas within the business, the final findings of the FDA, culminating in a formal warning letter issued in 2025, confirmed that the facility in question would remain permanently closed.
“This development has rendered the continued redeployment of these employees unsustainable, both operationally and financially.”
In parallel, Aspen had also recently suffered the termination of a major contract valued at about R2bn, prompting a comprehensive organisational review, the notice said.
“These compounding events have made it imperative for Aspen to align its workforce with its adjusted operational requirements and financial capacity.”
According to the notice, all 134 employees in the SVP Suite A could be affected.
Severance benefits would be provided based on the company’s policy, and affected employees would receive support with CV preparation and interview readiness.
“The possibility of retrenching employees is not something that the company is taking lightly, and throughout the retrenchment process we will consider all reasonable alternatives to retrenchment.”
Aspen spokesperson Shauneen Beukes said the number of affected employees was undisclosed.
The Gqeberha plant has three units for sterile products and only one makes eyedrops.
The company also makes sterile products at its Notre-Dame-de-Bondeville facility in France.
In a letter sent in February to the pharmaceutical manufacturer, the FDA warned Aspen that its eyedrop production facility put the products at risk of microbial contamination.
The drops are marketed exclusively in the US and are manufactured under contract for a customer it declined to identify.
The FDA said Aspen did not establish scientific systems to monitor impurities during stability testing of products containing the active pharmaceutical ingredients naphazoline hydrochloride or tetrahydrozoline hydrochloride.
They are found in non-prescription eyedrops used to treat redness caused by minor irritations.
It said FDA inspectors had found levels of impurities, which it did not identify, that might pose a risk to patient safety.
In a letter on Friday to staff, Bosman said no decisions were final.
“A formal joint consensus-seeking consultation process is currently under way,” he said.
“This process is being conducted in full compliance with legislation and close engagement with organised labour.
“It aims to explore potential alternatives to retrenchment and ensure that any decisions are fair, transparent and legally compliant.
“No final decisions have been made.
“The first CCMA-facilitated session will take place once final confirmation is received.
“We remain committed to keeping you informed where appropriate, while respecting the integrity and confidentiality of the consultation process currently under way.”
Aspen has had several bouts of retrenchments over the years, with 14 in the last 12 months.
Chemical, Energy, Paper, Printing, Wood and Allied Workers Union (Ceppwawu) organiser Karools Adams said they had received the CCMA notice on Monday.
“I do not want to comment at this stage as discussions have not started,” he said.
“I received a notification from Aspen last week that there would be potential restructurings affecting 134 people.”
Numsa regional secretary Mziyanda Twani said stewards had not yet received the notice.
“They are in Johannesburg and are engaged in salary negotiations with Aspen as we speak,” he said. — Additional reporting by Business Day
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