Abbott Laboratories - Top 10 pharma layoffs of 2011
Company: Abbott Laboratories ($ABT)
Based: Abbott Park, IL
Job cuts announced: 1,900
Date revealed: Jan. 26
Theme: Pipeline woes
The scoop: Abbott Laboratories kicked off 2011 with a big January layoff announcement, saying that the challenging regulatory environment was a force behind its plans to let go 1,900 workers, or 6% of its employees. Now further upheaval at Abbott is afoot with the planned breakup of the mammoth healthcare company into two separate entities: one focused on pharmaceuticals and one on other medical products.
It turns out that the spinoff of the pharmaceuticals business was music to the ears of some investors, but the breakup won't change the realities of the drug industry that led to the layoffs. For one, the high safety bar on new drugs is unlikely to drop, and Abbott learned the hard way about this trend when the FDA cited risks associated with the company's experimental psoriasis drug briakinumab, prompting the company to pull its application for the drug in major markets in January 2011.
This year is likely to be a historic one for Abbott as the company aims to execute the pharma spinoff, but a downside most likely will be angst among the ranks of workers wondering how the massive change will impact their jobs.