HEALTHCARE SERVICES group, United Drug, is seeking to lay off up to 150 workers from its Irish supply business, the company confirmed yesterday.

The company, which distributes and sells drugs and medical devices to hospitals and pharmacists in Ireland and Europe, said earlier this month it was seeking €5 million across all its businesses.

Yesterday, United Drug confirmed it will seek up to 150 voluntary redundancies from the operation’s full and part-time workforce, which is understood to stand at 650 in total.

The company briefed workers on Thursday, and has begun talks with their representatives.

United Drug blamed the Government and Health Services Executive’s drive to cut costs and the amount of money spent on drugs.

“These changes have resulted in falling revenues and margins, and our profitability over the last few years has been eroded,” the company said in a statement yesterday.

It added that the impact of the changes was particularly acute as its business generates margins of around 1 per cent.

Earlier this month, the company said in a quarterly update that Irish revenues remained under pressure as a result of Government measures to rein in health spending, and added that it intended cutting costs here. United Drug also said it was seeking savings worth a total of €5 million a-year across the group.

It estimated that the restructuring involved would result in a once-off charge of €9 million.

The group is listed on the Dublin and London stock exchanges. Outside Ireland it has businesses in Britain, Belgium,Sweden, the Netherlands and the US.

Around 65 per cent of its profits are generated from operations outside Ireland.

United Drug will report full-year results for the 12 months ended September 30th in November. It expects profits to be ahead of those reported at the end of its 2010 financial year.

The company said yesterday that it would not comment further on the voluntary redundancy process and intends to open talks with staff over the coming weeks.