Agency cuts loom with Sandoz-Ciba merger

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The merger of Sandoz and Ciba-Geigy, two of Switzerland's big three chemical/pharmaceutical companies, into a new company called Novartis will have consequences for the ad agency business. Both companies employ a large number of ad agencies across the world, so many in fact that spokespeople for the two giant companies say it will take a week to compile a list. They also say it is too early to assess a new agency lineup, but they believe redundancies are inevitable.

The merger, which creates one of the world's largest pharmaceutical groups, provides for the spinoff of Ciba's textile, chemical and polymer operations and of Sandoz's chemical operations, all of which have their own agencies. In Switzerland alone, dozens of agencies are involved in the pharmaceutical and chemical sectors. For Ciba, they include Seiler/ DDB Needham, Allcom Business, Schmidlein & Partner, L&F and Tondeur. The Sandoz pharmaceutical division's agencies include Marti/Ogilvy & Mather while Matter/ Leo Burnett works with Sandoz's chemicals division.

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