Issue Date: February 4, 2008
Over the next three years, pharmaceuticals maker Wyeth plans to cut as many as 5,000 jobs or 10% of its global workforce to decrease costs. The firm plans to share details with employees in March.
According to a company spokesman, the firm is evaluating its business with an eye toward becoming more efficient and lowering expenses. However, he cautions, "it is important to realize that nothing is etched in stone, and it is premature to discuss how many or which positions may be affected or how the reduction will be achieved."
The job cuts are part of an effort to counter financial difficulties expected in 2008. On Jan. 31, the firm reported that its 2007 income rose 10% to $4.6 billion on sales of $22.3 billion, but it forecast lower earnings and flat sales in 2008.
Other big pharma firms already are cutting employment and reducing costs as their patents expire and profitability slips. A year ago, Pfizer launched a restructuring plan that included the elimination of 10,000 jobs. More recently, Bristol-Myers Squibb said it would lay off 4,350 people.
Complicating the picture for Wyeth over the past year were delays in gaining FDA approval for four new drugs. In addition, generic drug competition has taken a toll. In December, after a legal dispute, Israel-based Teva Pharmaceutical Industries launched a generic version in the U.S. market of Wyeth's third-best-selling drug, Protonix, for severe heartburn. To recapture lost market share, Wyeth just launched its own generic version of the drug.
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