FORTY jobs are set to be slashed at a Morpeth pharmaceutical firm following the loss of a contract to make artificial sweeteners.

Pharmacia, formerly known as Searle Pharmaceuticals, made the shock announcement after the termination of a contract to supply Canderel with the sweeteners.

The plant currently employs 550 staff and company bosses remain confident that although redundancies will be inevitable most will be voluntary and that employees will also be redeployed in other areas of the factory.

The decision affects only the sweetener manufacturing and Pharmacia s main business, the manufacture of medicines and pharmaceutical ingredients, will be unaffected.

The contract to supply the sweetener products will cease at the end of May 2001 and has been blamed on the decision by Canderel owners Merisant Plc to pull out of the arrangement.

Pharmacia have been manufacturing Canderel since the early 1980s and ironically used to own the company before selling to Merisant and producing the sweeteners on a contractual basis.

It has not been disclosed how much cash will be lost by the collapse of the deal, but the Morpeth-based company has assured workers whose jobs are cut they will receive statutory redundancy packages.