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Medtronic one of the world’s largest medical devices manufacturer earlier this week announced that it will cut its workforce by 5 percent which translates into 1,500 to 2,000 fewer jobs. Most of the cuts will come from the company’s struggling external heart defibrillators unit (Physio-Controls) which it would like to sell. Revenues from pacemakers and defibrillators, Medtronic’s largest selling products, fell 2 percent in the last quarter. 

In a statement, the Minneapolis-based Medtronics will cut 4 percent to 5 percent of its employees with voluntary programs, retirements and layoffs. 

Until next time...

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

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Many life sciences company executives will tell you that getting US Food and Drug Administration (FDA) approval for their products has gotten tougher than it has been in the past 10 years or so. This shouldn’t come as a surprise to most BioJobBlog readers because there was almost know regulation of pharmaceutical, biotechnology and medical devices products during the eight years that Bush was in power. Seemingly, many life sciences companies have forgotten that FDA’s mission is to provide the American public with SAFE and efficacious drugs and devices; not to quickly approve products to bolster a company’s stock share price. That said, some medical devices companies, like their pharmaceutical and biotechnology cousins, have begun to complain about the FDA regulatory process for medical devices.

Historically, the regulatory challenges for getting medical devices approved have always been much lower than those for garnering approval of prescription drugs, vaccines and other biological products. Since 2000, the regulations guiding regulatory approval for medical devices had grown extremely lax.  For example, there has recently been a spate of recalls for certain previously-approved devices including cardiovascular stents, implantable cardiac devices and hip replacements.

The Obama administration is attempting to restore the rigor of the approval process and some medical devices companies are extremely unhappy about it. This renewed effort has forced some devices companies to eschew the lucrative US devices market entirely in favor of European and Asian markets; mainly because they were unable to garner FDA approval for their devices. Interestingly, the companies that are complaining the loudest are start ups rather than established medical devices companies. Their main complaints are the ever-increasing size of the clinical trials and length of time it takes to win regulatory approval for their products. Not surprisingly, these complaints are mostly driven by financial pressures at the start ups. Because of the recession, many of the venture capitalists who backed these companies have less money to invest and demand quicker and higher returns on their investments. Consequently, many of the star tups are under capitalized and simply don’t have the financial resources to stay in business and wait for FDA approval. While I understand their business pressures and urgency, winning FDA approval is suppose to be about safety and efficacy not about ROI. Maybe start up devices companies experiencing these difficulties ought to retool or reinvent their business plans!

To be clear, FDA approval rates for medical devices are down; 19 premarket approvals (PMA) were granted in 2010 as compared with 48 in 2000. Also, the average time to win 510(k) clearance (less stringent than PMA and used for most devices) rose to 116 days in 2008 from 97 days in 2002. There is no question that winning regulatory approval for new medical devices may seem to be getting tougher than in the recent past. But, if that helps to improve efficacy and patient safety than I don’t necessarily think that it is such a bad thing. And as Stephen Oesterle, MD senior vice president for medicine and technology at Medtronic (one of the world’s largest medical devices companies) aptly said in a recent NY Times article “The FDA is asking for larger trials, more thoughtful trials, all in the interest of the American public.”

Until next time...

Good Luck and Good Job Hunting!!!!

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Things are just not going well for Natick, MA-based device manufacturer Boston Scientific. Yesterday, the company announced that it lost $1.1 billion in the fourth quarter this year. The losses mainly stem from the company’s $1.73 billion settlement earlier this month with Johnson & Johnson ending a seven year patent dispute over drug-coated cardiovascular stents. Also, Boston Scientifics’ ill-advised purchase of medical device rival Guidant for $27 billion several years ago hasn’t helped matters.

The company said that it would cut as many as 1,300 jobs or 8 to 10 percent of its workforce to reduce operating expenses. Boston Scientifics’ decision to eliminate jobs follows similar moves made by several of its competitors last year. For example, last spring Medtronic, the largest device firm in the world, said it would eliminate at least 1,500 workers. In August, Minnesota rival St. Jude Medical eliminated 200 positions.

Device makers have seen their sales squeezed by safety recalls of top-selling products and cost cutting measures at hospitals because of the economic downturn. Also, new data suggest that drug-coated stents may not offer the benefits (over bare-metal stents) as previously thought. In fact, some physicians are beginning to reconsider the advantages of stents as compared with other surgical or pharmacologic interventions for certain cardiac patients.

While layoffs at medical devices manufacturers don’t come close to the massive layoffs in the pharmaceutical sector, don’t be surprised if other device manufacturers announce layoffs later this year.

Until next time...

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

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Minnesota-based Medtronic, Inc., one of the world’s largest medical devices companies, announced  that it was cutting about 1,100 jobs; 350 of which will be in Minnesota. This is the first layoff at the medical devices manufacturer in over 5 years. According to a press release, slightly over a third of the layoffs will come from the company’s local operations, which has about 8,000 employees. The overall effect of the reorganization will be relatively small—affecting roughly 3% of the company’s worldwide workforce of 39, 500.

Medtronic attributes the realignment (not restructuring according to company executives) to slumping sales of its spinal and cardiac devices. Accordingly, the company’s cardiac rhythm and neuroscience businesses along with local operations will bear the brunt of the job cuts.

It looks as though the entire life sciences sector is under assault. Belt yourself in—it’s going to be a rough ride for the foreseeable future!

Thanks to Ed at Pharmalot for the heads-up!

Until next time….

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

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