Look out, pharma marketing. As drugs continue dropping off the patent cliff, your departments are most vulnerable to new job cuts. And those job cuts will come, Morningstar analyst Damien Conover tells Reuters.
Never mind that drugmakers have already laid off tens of thousands of workers over the past few years, with 45,000 jobs cut this year alone. Conover expects additional workforce cuts of up to 2 percent. "We will see even more restructuring as we near the patent cliff," he told the news service. "[S]elling, general and administrative expenses will take the hardest hits."
The "most obvious targets," Reuters says, are sales people assigned to blockbusters set to go off patent. Pfizer's cholesterol drug Lipitor, for instance; Plavix, the Sanofi-Aventis and Bristol-Myers Squibb blood thinner, for another. Already, Pfizer is saying that its post-Wyeth-merger job cuts will be larger than expected, although it hasn't specified the parts of the combined company that will take the additional hits.
Drugmakers have been expecting generic competition for these mega-blockbusters, yes, but uptake of copycat drugs has been much quicker lately, Deutsche Bank's Barbara Ryan said. "[T]he rate of penetration of generics has been much higher than what anybody imagined," she told Reuters. And when more people turn to generics, branded drugmakers suffer.
- read the Reuters coverage