After Novartis drafted plans to wed its pharma and oncology businesses earlier this month, reports of potential layoffs poured in. Now, as Novartis taps prolific Wall Street analyst Ronny Gal, Ph.D., to spearhead M&A, the company has confirmed that thousands of positions could be under threat.
“As a broad range, we expect a number in the single digit thousands of roles across the company would be impacted by these changes,” a Novartis spokesperson told Fierce Pharma via email. “This will be subject to consultation with works councils and subject to the finalization of the full organizational structure."
The company stopped short of naming a precise layoff figure given that the design of the restructuring is still in flux, the spokesperson said.
Novartis expects “the new structure to be fully in place and operational by the end of 2022," she added.
Some affected employees might be able to switch to open roles at the company, Novartis told Endpoints News, which first reported the layoff confirmation.
In early April, Novartis said it was merging its oncology and pharmaceuticals commercial departments into a singular innovative medicines unit, which will be managed under U.S. and international markets organizations.
At the time, Novartis said the combination would trigger some job cuts but that it was too early to speculate which roles and how many. Also at that time, three Novartis executives were left without positions at the company.
In its Tuesday email to Fierce Pharma, Novartis didn’t say what types of job duties would be affected or where.
In addition to the layoff plan, Novartis is also reviewing options for its generics unit Sandoz. The company hasn't decided whether to keep the business or spin it off.
As part of the reorganization plan, meanwhile, Novartis has minted the role of chief strategy and growth officer—a new position in charge of corporate strategy, R&D portfolio strategy and business development.
Tuesday, Novartis made the surprising decision to slot seasoned Bernstein analyst Gal into the role. Novartis CEO Vas Narasimhan has stressed that the gig will be independent from Novartis’ R&D and commercial teams.
Under Novartis’ current M&A focus, Gal will be on the hunt for targets with a deal size below $2 billion, Narasimhan said on a press call Tuesday. The goal of the restructuring, for its part, is to save at least $1 billion a year by 2024.
Novartis had 41,280 employees working in sales and marketing as of year-end 2021. At the time, the company had nearly 12,800 staffers in operations and 4,727 in general and administration.