Last month, AstraZeneca said it would cut $1.1 billion in annual costs, zeroing in on sales and administrative expenses for a big part of those savings.
Now, the U.K.-based company’s sales operation in the U.S. is feeling the effects.
AstraZeneca cut its contract salesforce from Publicis Touchpoint Solutions, the company confirmed in an emailed statement Tuesday, and is reviewing its AstraZeneca sales staffing as well.
Publicis handles AstraZeneca brands in a variety of therapeutic areas, AstraZeneca spokeswoman Abby Bozarth said. The clinical educator team will also see some cutbacks.
“We flexibly shape our selling teams to fit the realities of the marketplace and maximize opportunities for both our growth and future brands,” Bozarth said.
Publicis sales reps on the AstraZeneca force said the cutbacks would hit 1,600 contract employees, largely in diabetes, although the respiratory team and the Movantik force would also see some reductions. The sources spoke on condition that they remain anonymous.
The Publicis cuts take effect June 30. They were announced via conference call Monday.
AstraZeneca would not confirm hard numbers on the staffing changes. But the company said it’s revisiting its “field force deployment” as part of its “ongoing strategy to operate its business more efficiently.”
Bozarth said the company is working through the details of the cutbacks now. “We are reviewing all staffing as we make decisions on how best to align our sales organization for success,” she told FiercePharma via email, and “this includes both AstraZeneca and contracted sales force roles.”
As Bozarth pointed out, pharma companies commonly use contract sales groups to augment in-house sales forces as a way to manage staffing levels. Drugmakers often grow and shrink their sales teams by adding or subtracting contract reps. The approach “gives us the flexibility to change our sales force size to react to market changes and to meet customer needs,” Bozarth said. “[T]hese changes will not impact our ability to bring innovative medicines to people who need them.”
AstraZeneca is hardly alone in cutting sales jobs. Japan-based Daiichi Sankyo recently announced up to 1,200 layoffs in its U.S. unit, many of them in its commercial headquarters, and Sanofi told French unions earlier this year that it would cut 155 jobs in its sales and marketing force there. In late 2014, GlaxoSmithKline said it would cut hundreds of commercial jobs; the layoffs were part of a $1.6 billion restructuring designed to cope with fast-declining sales of respiratory giant Advair.
More recently, the embattled drugmaker Valeant Pharmaceuticals, facing a sales hit after promising to abandon its growth-through-price-hikes strategy, said it would cut loose 140 contract reps handling the new female libido pill Addyi, as well as 140 salespeople repping its dermatology, GI and women’s health brands.
Like Daiichi, which cut jobs as its big-selling blood pressure drug Benicar neared the end of its patent life, AstraZeneca is anticipating sales slippage for a blockbuster med now facing generics. The cholesterol fighter Crestor, the company’s top seller with $5 billion in 2015 sales, lost its exclusivity May 1.
AstraZeneca plots cost cuts to save $1.1B as Crestor generics loom
Valeant moves quickly to slash jobs, beginning with Addyi, dermatology sales reps
Sanofi sharpens job-cutting ax with 500-plus in France
Struggling Daiichi plots another 1,000-plus job cuts in U.S.
GSK makes deep job cuts as Advair sales crash fast