Drugmakers see contract reps as an easy-come, easy-go approach to marketing. Hire up when times are busy and new drugs rolling; staff down when drugs go off patent or the cost-cutting police come calling. But contract reps have rights, too--and that's why a former Eli Lilly ($LLY) salesperson is suing the company.
As the Indianapolis Star reports, Leslie Pinciaro Dudley isn't asking for much money--just the $15,000 in bonuses she believes she's owed. But she is hoping to gather other contract reps to her cause for a class action against the company.
Dudley worked for Lilly from February 2011 to March 2013, and for most of that time frame, she earned her bonuses and collected them on schedule. But her final round of incentive pay wasn't forthcoming, her lawyer, Steven Simmons, told the Star.
At issue, apparently, is a clause in Lilly's contract that requires temporary reps to still be working on the last day of each incentive-pay period. Lilly says Dudley's employment contract expired three weeks before that time frame ended, and so she wasn't entitled to a bonus. Simmons says Dudley's contract didn't include that clause.
As Dudley's contract expired, Lilly was preparing to lay off hundreds of sales reps, anticipating generic rivals for its top-selling antidepressant, Cymbalta. Dudley worked in Lilly's men's health division, but the company has been cutting costs all over.
Lilly has filed a motion to dismiss the case, but a judge hasn't yet acted on it. Whether other contract reps might sign on to Dudley's claim remains to be seen. In the meantime, would Lilly settle if the judge decides not to toss the suit? The company may want to avoid setting a precedent. Does this lawsuit portend more conflict among drugmakers and contract salespeople? It looks like a very specific--and small--case to us, but we aren't in the habit of reading reps' employment contracts.
We'd wager, however, that this is no multimillion-dollar class action like the overtime cases still plaguing Big Pharma. That series of lawsuits--against Lilly, but also Bristol-Myers Squibb ($BMY), GlaxoSmithKline ($GSK), Abbott Laboratories ($ABT) and more--cost some drugmakers big money, and the issue made its way to the Supreme Court. The justices ruled that pharma reps aren't entitled to overtime, probably saving the industry hundreds of millions.
- read the Star story
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