The 2012 layoffs toll may continue to mount. British newspapers are reporting that AstraZeneca's ($AZN) cost-squeezing program could grow by another 3,000 or so job cuts. The company is said to be preparing an announcement in conjunction with its earnings release later this week. AstraZeneca itself won't comment on the talk, nor about a possible expansion of its stock-buyback program, but did tell The Telegraph that its "clear focus on cash and value creation will continue."
If true, the additional layoffs would follow about 1,500 job cuts announced for the U.S. salesforce and commercial operations late last year, and a series of restructuring programs that have cast off about 24,000 positions since 2009. Like its Big Pharma rivals, AstraZeneca faces the loss of patent protection on several top-earning products, including the antipsychotic drug Seroquel. It's also suffering from pricing pressures in Europe and new Medicare rebates in the U.S.
Unlike some of its rivals, however, AstraZeneca has also stumbled repeatedly on the R&D side over the past year or so. Several promising programs--such as its ovarian cancer treatment olaparib--have faltered or fallen apart altogether. The company is taking a $381 million write-off on recent R&D losses in the fourth quarter, on top of a $445 million R&D charge for the same period in 2010.
Those failures leave the U.K.-based company fewer prospects for rebuilding its revenues as generic erosion continues. One bright spot is Brilinta, the company's new blood thinner; it recently won a recommendation from U.K. cost-effectiveness watchdogs, and German regulators declared it superior to older treatments, a key designation under that country's new price-setting program.
The new layoffs announcement may be accompanied by a $3 billion expansion of AstraZeneca's stock-buyback program, the Manchester Evening News reports. That would come on top of about $2.1 billion worth of repurchases in 2010 and about $4 billion in 2011, The Telegraph says.
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- see the Evening News story
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Special Report: AstraZeneca - Top 10 pharma layoffs of 2011