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After completing the $6.8 billion purchase of Pennsylvania-based Cephalon, Teva, the world’s largest generic drug manufacturer announced plans to eliminate about 1,500 US jobs, most of them at Cephalon. Cephalon, which has several marketed products, currently employees about 3,700 US-based persons. This means that Teva will cut Cephalon’s workforce by about 40 percent.

According to a post on today’s Pharmalot blog, a company spokesperson said that the jobs that will be eliminated will be those that overlap with those functions already being performed by Teva. Layoffs at Cephalon were not unexpected as the company had previously identified approximately $500 million in possible savings that it would implement after the deal closed.

If layoffs at pharmaceutical and biotechnology companies continue at their current pace, I am not sure that there will be a US life sciences industry in the future.

Until next time...

Good Luck and Good Job Hunting!!!!!!!!!

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From 2001 to present, roughly 300,000 pharmaceutical employees have lost their jobs. That is a massive number; second only to the job losses in the automotive and financial services industries. The main reasons for the layoffs have been a lack of return on investment on R&D activities and impending patent cliffs in 2013 for as many as 15 blockbuster drugs. 

Ed Silverman who runs the Pharmalot blog speculated in a post yesterday that the number of pharma layoffs may be dwindling. His assertions are based on an analysis of the annual number of pharma layoffs provided by the outplacement firm of Challenger, Gray and Christmas. Ed’s wrote:

 “So far this year, pharma layoffs have totaled 19,076, and this includes the 13,000 job cuts planned by Merck, which is actually eyeing many foreign positions, therefore, swelling the latest tally. Last year, pharma eliminated 53,636 jobs, down from 61,109 in 2009, when annual layoffs peaked. In fact, the 2009 bloodletting was outsized compared with every other year - the next highest annual layoff tally occurred in 2008, when 43,014 industry cuts were announced. Between 2003 and 2007, the number of jobs that were eliminated ranged from about 15,000 to 31,000 annually, according to the firm.”

This led Ed to posit that the worst may be over and those pharma employees who still have jobs may be able to relax a bit. However, it is important to note (as Ed also points out) that many big companies are still purchasing or opening new  R&D and manufacturing facilities in emerging markets like India and China and more and more R&D jobs are being outsourced. Further, while many US pharma reps have lost their jobs hiring reps in emerging markets continues to explode. Interestingly jobs that are in demand and still available to Americans include those in regulatory affairs, compliance, IT, clinical operations and marketing. Unfortunately, these are very specialized jobs and many of those pharma employees who have been layed off lack the requisite skills to compete for those jobs!

While I think we may have seen the last of massive layoff in big pharma, smaller and less publicized layoffs will likely continue at many US life sciences companies. The downsizing trend taking place in America will likely continue until drug pipelines are populated with new candidates and life science executive realize that outsourcing R&D job is not a viable solution for their productivity problems.

Until next time...

Good Luck and Good Job Hunting!!!!!

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Several weeks ago Bayer AG’s Chief Executive Officer Marijn Dekkers said that he would consider a “merger of equals” to bolster the company’s sagging healthcare division. The division, a minor revenue source for Bayer AG, posted $25.1 billion in sales last year.

Today, the company announced that by 2013 it would outsource the entire production of its blockbuster MS treatment Betaferon to its German arch rival Boehringer Ingelheim. At present, Betaferon sold in the US is manufactured at Bayer’s production facility in Emeryville, CA. Bayer will close that facility and about 540 jobs will be lost.

Boehringer already manufactures Betaferon sold in Europe and it recently received US Food and Drug Administration approval to also sell it in the US. A Bayer spokesperson said that “It is important for us that we can offer the product from a single source.” While that makes sense from a regulatory standpoint, the decision also suggests that Bayer Healthcare may indeed be positioning itself for sale. It also suggests that Bayer may be abandoning the US market for “greener pastures” in the emerging BRIC markets (Brazil, Russia, India and China).

For more insights into Bayer Healthcare check us this article in Life Science Leader.

Until next time...

Good Luck and Good Job Hunting!!!!!!!

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Mathew Herper, who writes at the Forbes Blog, reported today that according to a report compiled by the outplacement firm Challenger, Gray and Christmas, since 2000 the pharmaceutical industry cut 297,650 jobs. According to Herper “that is about as many people as currently work at the three largest drug makers — Pfizer, Merck, and GlaxoSmithKline — combined.” As he aptly points out “Many of those who were laid off were probably hired back by other drug makers. Some folks have probably been laid off more than once. It’s also worth noting that big mergers are one reason for the cuts.”

Nevertheless, the number of lost jobs is staggering. Interestingly, while almost 300,000 jobs have been lost in the last decade, a majority of the cuts (234,814) have taken place over the past six years (see below).   It is not clear from the report whether or not these numbers include the numbers of jobs lost by the aggregate life sciences industry (including biotech and specialty pharma) or only by the pharmaceutical sector.    

   Source: Challenger, Gray & Christmas, Inc. © (via the Forbes Blog)

With mergers on the way and more jobs being outsourced to Asia and elsewhere, don’t be surprised if the total number of layoffs continues to grow.

Until next time

Good Luck and Good Job Hunting!!!!!!!!!!

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The Japanese drug maker Eisai, Co announced that it will cut at least 900 jobs over the next five years to improve operating margins to offset the impending lost of patent protection for Aricept its blockbuster Alzheimer’s  disease treatment. The company did not specify where the cuts would take place.

In other news, based Eli Lilly & Co announced plans to outsource its R&D bioanalytical functions to Advion Biosciences a contract research organization that is building new laboratories Lilly’s home town of Indianapolis, Indiana. Ithaca NY-based Advion is building a 22,000 sq ft facility that will focus on ADME and toxicology experiments that are required for new molecules to enter human clinical testing.

Advion offers a range of Good Laboratory Practice-compliant and discovery bioanalytical services, including liquid chromatography-tandem mass spectrometry (LC/MS/MS) for determining small-molecule drugs, macromolecule therapies and biomarkers; immunoassay services; ADME (absorption, distribution, metabolism, and excretion) screening; cytochrome P450 inhibition and induction study support; metabolism profiling; metabolite identification; sample management; and sample storage.

According to a press release:

 “Lilly will transition its own drug discovery bioanalytical capabilities to Advion and will offer employees affected by the move the opportunity to join Advion. The new laboratory is expected to be fully operational by the end of May 2011.”

This is another example of big pharmaceutical companies exiting the R&D space. Because of the rampant downsizing and outsourcing of R&D functions to CROs, now could be one of the better times in years to start a biotech company. Big pharma is relying on starts up companies and academic laboratories to be the major source of new molecules that they develop. That said, the age of big “in-house” drug discovery operations at big pharmaceutical companies is drawing to an end. 

Until next time...

Good Luck and Good Job Hunting!!!!!!!!!!!!!!!!

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The German drug maker Bayer today announced that it plans to eliminate 4,500 jobs by 2012. Of the 4,500 positions to be cut, roughly 1,700 will be eliminated in Germany. Interestingly, during the same period, Bayer plans on creating 2,500 new jobs in “emerging markets;” yet another sign that big pharma is betting on translating the explosive growth of these markets into large profits.

While pharma’s interest in emerging markets may be good for the workers who live in these regions, it has been disastrous for scientists and sales personnel in developed markets like the US and Europe. To date, almost 200,000 pharmaceutical and biotechnology employees have lost their jobs since 2007.

Until next time...

Good Luck and Good Job Hunting!!!!!!!!

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The fiscal year at most life sciences companies is drawing to a close, new budgets are being crafted and the holiday season is almost upon us. In years past, this time of year typically meant that it was bonus time for most pharma workers. Sadly, over the past three years bonus time has been replaced by layoff time. And, unfortunately the upcoming holiday season may not be joyous for many Pfizer and Roche employees.

Yesterday, Pfizer indicated that it may lay off up to 11,700 more employees than the 19,500 it had announced in connection with the buyout last year of Wyeth Pharmaceuticals. While Pfizer confirmed that it would be reducing its worldwide work force by more than the originally expected 19,500 the exact number remains a mystery. However, a quarterly report filed Friday with the U.S. Securities and Exchange Commission stated that Pfizer has estimated termination costs for 46,600 employees, while only 33,400 workers had actually been laid off as of Oct. 3. This appears to suggest that the company plans to reduce its work force by 11,700 more than originally announced, given that Pfizer is only 1,500 positions away from fulfilling its job-elimination pledge related to the Wyeth merger.

The additional job cuts—if they are realized—would amount to about 10 percent of Pfizer’s worldwide work force. If a reduction of that magnitude were applied to Pfizer drug-research sites in Groton and New London, which currently employ nearly 5,000 workers, about 500 jobs would be lost. The company in January 2009 announced that cuts would total 15 percent of the combined Pfizer and Wyeth work force. At the time, the combined work force numbered about 130,000; the latest official figure places that number at 111,500.

In other news, Roche today announced plans to cut 4,800 jobs, or 6 percent of its worldwide workforce of 82,000. Today’s announcement confirms the news leak three months ago (reported by the Pharmalot Blog) which suggested that job cuts would be likely during the fall.

According to today’s press release, technical operations activities will be reorganized in California, Mannheim, Germany and various other sites, resulting in the elimination of 750 jobs. The company also intends to sell sites in Florence, South Carolina and Boulder, Colorado; shedding an additional 600 jobs. About 1,200 jobs will be cut in the North American commercial operations, mainly in Roche’s primary-care business, while 700 positions will be lost in commercial operations in Europe.

R&D will also be affected. The company will discontinue activities in research and early development in RNA interference in Kulmbach, Germany, Nutley, New Jersey, and Madison, Wisconsin. Also, there are plans to reorganize other operations at these sites which will eliminate another 600 jobs.

Until next time...

Good Luck and Good Job Hunting (are there any left?)!!!!

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Last week, the outsourcing firm Challenger, Gray and Christmas reported that layoffs at big pharmaceutical companies had slowed in August. However, while layoffs may have begun to slow at many big pharma companies, they are continuing at several biotechnology and specialty pharmaceutical companies.

In a press release late last week, Roche CEO Severin Schwan announced that the company will review its business and cut costs to offset recent setbacks with some of its key drugs and rising healthcare costs. These setbacks include suspension of clinical trials for ocrelizumab, a mAb-based treatment for rheumatoid arthritis, a rejection of accelerated review of trasttuzumab-DM₁ a new breast cancer treatment and a delay in approval for a diabetes drug.

Many of the setbacks have occurred at its biotechnology subsidiary, Genentech. Consequently, much of the costs savings, including restructuring and layoffs will likely occur at Genentech over the next few years. The cutbacks are expected to save the company almost $1.9 billion per year. According to one biotechnology analyst:

"They will mainly be looking at the primary sales force and R&D for cuts, which will be mostly in the United States and Europe. There was overcapacity in the sales team -- numbering around 1,500 in the United States and Europe -- after a recent delay to its diabetes drug candidate taspoglutide and the fact Roche had one of the highest research and development spending rates in the industry offered scope for savings”

In related news, Marc Tessier-Lavigne, PhD, Genentech’s second in command for R&D, yesterday announced that he was leaving Genentech to become President of Rockefeller University. While Dr. Tessier-Lavigne contends that his decision to leave Genentech after 7 years has nothing to do with expected cutbacks and layoffs, his departure signals that big changes are likely at the company in the near future.

Also last week, Endo Pharmaceuticals announced that it would be cutting the size of its sales force. The announcement comes just one month after Endo agreed to purchase Penwest Pharmaceuticals for $144 million. Moreover, the $3.2 billion dollar merger between the biotechnology company Valeant Pharmaceuticals and Biovail is expected to result in a 25 percent reduction of its combined 4,000 employee workforce. Finally, Japanese drug maker Shionogi yesterday announced that it is cutting roughly 50 percent of its US sales force to 350 sales reps.

Although layoffs may have appeared to abate at many big pharma companies, don’t be surprised if new job cuts are announced around the beginning of the US holiday season this year. Also, layoffs will continue at biotechnology and specialty pharma companies as consolidation continues in these sectors.

Until next time...

Good Luck and Good Job Hunting!!!!!!!!!

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Japanese drug maker Takeda Pharmaceuticals announced today that it will slash almost 1,600 jobs or 28 per cent of its 5000 person US workforce. Most of the cuts will take place at the company’s North American headquarters (1400) in Deerfield, Illinois; the remainder (ca. 170) will occur at Takeda Global Research and Development Center in Lake Forest. These cuts represent a 20 per cent reduction in R&D employees at the site.

The layoffs, which are part of a restructuring of Takeda’s North American operations, are directly related to declining sales and the coming generic competition to its top-selling diabetes drug Actos. In addition to being Takeda's biggest revenue producer, Actos is the nation's top-selling brand name diabetes drug and was the 8th-best selling brand in 2009, generating $3.4 billion in U.S. sales, according to the most recent information available from market.

Despite rumors of job creation in other sectors of the US economy, pharmaceutical companies continue to shed jobs.

Until next time…

Good Luck and Good Job Hunting!!!!!!!!!!

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Bristol-Myers Squibb (BMS) announced Tuesday that its board authorized the repurchase of up to $3 billion of its common stock.

The company said the buyback program has no expiration date and will take place over the next few years. Company spokespersons said the decision reflects Bristol-Myers' strong financial position, which included $9.8 billion in cash and marketable securities at the end of the first quarter.

While stock repurchase programs are common, BMS is steeling itself for the expected loss of substantial revenues beginning in 2011 due to patent expiry of its top selling anti-clotting medication Plavix. In the past year or so, the company has sold off a profitable medical device subsidiary (Convatec) and a consumer products company (Meade Johnson) to sure up its finances and improve stock share price. 

Long be rumored to be a takeover target, BMS has attempted to reinvent itself over the past few years as a “next generation biopharmaceutical company” through licensing agreements and acquisition of smaller biotechnology companies with promising technology platforms and near term new biotechnology products (Medarex). However, the loss of Imclone—the biotechnology company that developed the one of the top-selling colon cancer drugs called Erbitux—to rival drug maker Eli Lilly has significantly slowed the next generation initiative.

Stay tuned for all late-breaking events.

Until next time…

Good Luck and Good Job Hunting!!!!!!

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As the recession slogs on, it is likely that many more people will lose their jobs and you might find yourself in the unenviable position of having to commiserate or console a friend or colleague was layed off. Not surprisingly, this is often a difficult and delicate situation that requires some sensitivity and tact. 

Because many of us have never been layed off or fired, it is often difficult to know what to say or more importantly determine what a person who lost their job may want from family and friends. To that end, there was a wonderful article in today’s New York Times that offers some insightful suggestions and guidance on navigating a conversation or meeting with a friend or colleague who recently lost their job.

Read and learn!!!!!

Until next time...

Good Luck and Good Job Hunting!!!!!!!!!

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I know this is kind of odd, but I have recently begun to wonder which life sciences companies have layed off the most employees this past year. Well, for those of you out there who were also wondering we don't have to wonder any longer because Ed Silverman over at the Pharmalot blog has conveniently compiled a list of the top offenders for us. For those of you who may be wondering which company was number one on the list, it’s name begins with a “P” and ends with an “r.”

Until next time…

Good Luck and Good Job Hunting!!!!!!!!
 

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According to a recent analysis conducted by Covalence a Geneva Switzerland-based organization that tracks the ethical reputation of multinationals, the pharmaceutical industry’s ethical reputation dropped from first to third on Covalence’s all-time EthicalQuote ranking that monitors 10 industries. Further, over the past year, pharma has only managed to achieve an overall ranking of 8th on the list.

The reasons given for the ongoing decline are increased attention on product risk and decreasing media coverage of donations and philanthropy of pharmaceutical companies. The recent high profile coverage of the safety risks associated GlaxoSmithKline’s Paxil and Merck’s Vioxx are good examples of why the ethical image of pharma continues on its downward spiral.

To improve their image, ethicists recommend that drug companies showcase innovative drugs in poor countries, reduce prices to increase access to drugs and loosen intellectual property rights so that there is global access to potentially life-saving drugs. While several companies like Merck and Roche have gone down this path, it may be too little too late.

Until next time…

Good Luck and Good Job Hunting!!!!!!!!

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The Pharmalot Blog reported today that Schering Plough will eliminate 1,000sales jobs or 20% of its sales force by October. This latest round of layoffs is part of a reorganization plan that was announced last year to cut 10% of it workforce by 2012 (although must of the downsizing will occur by 2010). The reorganization was announced shortly after Schering purchased Organon Biosciences and the “wheels came off” of its Zetia/Vytorin anti-cholesterol medication franchise.

In other news, BioJobBlog heard through the grapevine that Merck has been quietly laying off workers (since Labor Day) in an attempt to reduce its workforce by 20% over the next few years. Many very talented people who have been with Merck for years are looking for new jobs.

Finally, Montvale, NJ-based Memory Pharmaceuticals announced that it was laying off 55 workers or roughly 50% of its workforce. The company, which went public in a much heralded IPO in 2004, focuses on developing treatments for cognitive disorders. Although the company has never been profitable, the person who ran the company for the past three years (first as president, then CEO and finally CFO) earned $876,807 last year. Not surprisingly, he will be leaving the company as part of the downsizing initiative.

The ongoing pharma slowdown coupled with this week’s Wall Street meltdown (many people who work on Wall Street live in New Jersey) should make New Jersey a very challenging and interesting place to live in the coming months.

Hat tip to Ed at Pharmalot.

Until next time….

Good Luck and Good Job Hunting (I would avoid NJ)!!!!!!

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On the heels of yesterday’s announcement that it wants to buy Genentech, Roche, in a surprise move, announced today that it will move its Nutley, NJ-based US corporate headquarters to California. According to a report, research and development activities in oncology and metabolism at the Nutley site will be expanded. However, the company will consolidate all Nutley-based finance and information-technology operations and close manufacturing facilities on the site by 2010. It is not clear how many of Roche’s 3,240 New Jersey employees will be affected by the proposed move to South San Francisco. Suffice it to say, more than a few Roche employees are likely to lose their jobs after the company’s headquarters heads west.

Once dubbed the”nation's medicine chest”, New Jersey has steadily been losing pharmaceutical jobs since 1990 when 20% of all US pharmaceutical jobs were in NJ—at present 13.7% of  American pharmaceutical jobs reside in NJ. It has been a long, slow burn for the pharmaceutical and biotechnology workforce in the Garden State.

The Roche announcement comes as several other New Jersey drug makers, including Schering-Plough and Johnson & Johnson's Ortho Biotech unit, have been laying off workers because of the economic downturn and tough times in the industry. It also comes several days after Barr Pharmaceuticals, headquartered in Montvale, announced that it is being acquired for $7.5 billion by Israeli generics giant Teva.  

The growing scarcity of pharmaceutical and biotechnology jobs coupled with the highest property taxes in the US may cause a mass migration from the state. Not that there is anything wrong with that!!!!!!

Until next time….

Good Luck and Good Job Hunting!!!!!

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I happened upon a Sunday morning talk show yesterday where one of the guests was discussing strategies that employees ought to adopt to keep their jobs in a recessionary economy. For those of you who haven’t been paying attention, the US economy lost 63,000 jobs last month; another bit of evidence that we are sliding into an unavoidable recession. 

The talk show guest posited that only those employees who were able to quickly adapt to rapidly changing corporate/business environments would keep their jobs; the other less adaptable employees would find themselves jobless. Call me crazy, but his analysis sounded eerily similar to Darwin’s principle of natural selection or “survival of the fittest”–only those members of a population who were able to adapt (through mutations in Darwin’s case)  to changing environmental conditions will survive; the other less adaptable members will perish. Imagine that, using a recessionary economy to illustrate one of the fundamental principles of Darwin’s theory of evolution–how cool is that?

Here are some insights into how to keep your job during a recession when many companies are unstable and in flux. First, employees who work at financially-troubled companies must embrace the changes frequently instituted by management whether or not they agree with them. Invariably, there will be a cadre of employees who openly and publicly criticize the “new corporate policies”–these will likely be the employees who are demoted or “right-sized” out of the company.  In Darwinian terms, these employees are unable to adapt to change and they will either be eliminated or their standing in the population (company) will be diminished.  On the other hand, the employees who are able to embrace change will not lose their jobs and will likely be able to maintain or improve their standing in the population (company).  In other words, adaptable employees have a selective, competitive advantage over unadaptable ones which will allow them to survive and flourish in their new environment. Second, it is probably not wise during periods of corporate upheaval, for mid-level managers or employees to tout their past accomplishments or remind management about their worth to the company. In times of change, management embraces individuals with forward-looking ideas (to facilitate change) not those who are rooted in the past and are invested in antiquated corporate policies and practices. Again, only those employees who adapt will be able to survive and compete in their new corporate environment.  Finally, as a science educator, it is always exhilarating and exciting to find new ways to teach Darwin’s Theory (sic) of Evolution so that it makes sense to lay audiences. Maybe watching Sunday morning talk shows isn’t a waste of time after all!!!!

Until next time… 

Good Luck and Good Job Hunting (adapt)!!!!!!!!!

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