Hard on the heels of its merger with Cephalon, Teva Pharmaceutical Industries ($TEVA) is sharpening its jobs axe. Israeli news sources report anywhere from 1,000 to 1,500 cuts, with most of the layoffs in Europe and the U.S., and many concentrated in Cephalon's generics business.
Globes' numbers are on the low end. The news service says Teva is looking for $500 million in synergies from the buyout, and layoffs will help fill the bill. The 1,000 job-cuts target would represent 27% of Cephalon's workforce before the acquisition. When Teva bought U.S. generics specialist Barr in 2008, 10% of its workers were cut, Globes says.
One focus of cuts will be Mepha, the Swiss generics maker Cephalon bought last year, Globes reports. The company had 620 jobs when Cephalon snapped it up.
Ynet News, meanwhile, says Teva is eyeing 1,500 job cuts. Several employees have already been given notice, the site reports, citing Calcalist. Not surprisingly, most of the jobs wearing a bulls-eye are in redundant departments; like Globes' sources, Ynet mentions Mepha as a unit that will bear a big portion of the pain.
Some other clues as to where jobs might be cut come in the breakdown of Teva's "synergy" plans. The company said it would cut sales, marketing and admin expenses by $300 million, R&D by $120 million to $150 million, and production costs by $50 million to $80 million. The R&D savings would be achieved by cutting duplicate operations, the company said.