Though GlaxoSmithkline has yet to confirm the rumors, two papers are reporting that the world's second-largest drugmaker is set to eliminate between 6,000 and 10,000 jobs.
The two UK-based papers--the Telegraph and the Observer--are reporting different figures. The Observer is projecting a loss of about 10,000 of the company's 100,000-person workforce, while the Telegraph says only 6,000 positions will go. Neither paper cited a source.
While no announcements have been made yet, the cuts are likely to hit two segments in particular. Sales reps, who have seen many of their jobs evaporate over the last year, will almost certainly suffer some of the cuts. Additionally, jobs will be cut in the UK, which will only create more problems for the country's ailing biopharma sector.
The reasons behind pharma layoffs are well-known by this point. Like so many of its rivals, GSK is facing patent expirations in the coming years, which means increased competition from generic drugmakers. The company has already cut 1,800 pharma reps, 1,200 R&D workers and shuttered two plants that produce several drugs that are going-off patent. This new round of layoffs is part of CEO Andrew Witty's ongoing efforts to reorganize and diversify GSK to prepare for tough years ahead. Witty wants GSK to rely less on blockbuster drugs and more on a broad range of smaller drugs, which would protect the company from repeating the patent-loss scramble in the future.