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1,000 Layoffs Expected At Bucks County Prescription Firm

BENSALEM (CBS) -- Just before the holidays comes bad economic news from Bucks County. One thousand people will be losing their jobs early next year as Express Scripts says it's pulling out of Bensalem completely.

The mail order prescription company based in St. Louis will shutter its dispensing plant on Marshall Lane and the prescription processing plant on Street Road.

The company says both facilities and the one thousand people they employ will be gone by February 1st.

Bensalem Mayor Joe DiGirolamo calls the news devastating for the township.

"We were hopeful that we could save those jobs, we were hopeful that they weren't all leaving, never gave up hope but obviously that's gone now. So it's a big blow to us," said DiGirolamo.

Express had said they would close the Marshall Lane plant. The company decided to close the other location because of what it calls an impasse in labor negotiations.

DiGirolamo says the township will now work hard to try to find a company or two to help make up some of those job losses.

Thom Gross, a spokesman for Express Scripts, said "We have asked the union to enter "effects bargaining" in which the goal is to arrive at a shutdown agreement that includes severance, outplacement, work transfer and other considerations. Because we have reached an impasse in labor negotiations, Express Scripts has announced that it will be closing its prescription-processing facility in Bensalem, Pa., approximately Feb. 1, 2011.

We attempted for more than eight months to negotiate an agreement with the union that would have allowed us to continue to operate the Bensalem prescription-processing facility. We understand how this situation affects the families involved, and that is why we worked tirelessly during negotiations to avoid this outcome. However, we have a commitment to clients and patients: to make the use of prescription drugs safer and more affordable. We can deliver on this promise only when we control our costs.

At Express Scripts, we are in the business of reducing the overall cost of healthcare. We do that by making prescription drugs safer and more affordable while improving health outcomes for the millions of Americans we serve. One important reason we are able to hold down the cost of prescription drugs is that we operate very efficiently and keep our own costs under control.

The wages and benefits we provide our employees are competitive, and compare favorably with what similar workers make in their geographical area. However, labor costs at our prescription-processing facility in Bensalem were the highest in our system by a significant margin. We asked the union representing Bensalem employees to agree to some adjustments that would bring that facility in line with our other facilities nationally. These adjustments were essential for us to continue to make the use of prescription drugs more affordable, to stay competitive, and to keep these jobs in the Bensalem community. However, the union never made a proposal that met the company's objective of becoming cost competitive.

The company previously announced the closing of its dispensing pharmacy in Bensalem, effective Dec. 16, 2010, because of overcapacity and the availability of technology in our system that makes filling prescriptions safer and more accurate. That decision remains in effect."

In response, Dan Haney, the VP of the Express Scripts chapter of the Service Employees International Union Local 1199 said, "Absolutely this came as a shock because we're still in negotiations as far as we're concerned. We'll fight until the day they close, if they close."

Union officials say the union offered to take paycuts, pay freezes and proposed to take $8 million in concessions but the company rejected the offer. The union calls the company's decision to close the two plants, "illegal" and plans to fight this matter in court.

Reported By: Brad Segall, KYW Newsradio; Elizabeth Hur, CBS 3

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