Top 10 most productive workforces in biopharma

Gilead Sciences, Celgene and Biogen topped the list of most productive biopharma companies. (Image: Pixabay)

The math is simple, but managing a company isn’t. That’s the message we gleaned in analyzing productivity at major pharmas and biotech companies. As measured by revenue per employee as reported in 2016, the most recent full-year numbers available, we found a winning formula: Sell a powerhouse medicine with a relatively small pack of people. For Gilead Sciences, that’s its hepatitis C franchise; for Celgene, that’s Revlimid; for Biogen, it’s multiple sclerosis, at least for now. 

Easier said than done, of course. Big biotechs are historically good at maintaining high efficiency, but their highly concentrated therapeutic focus and smaller size can become a drawback as breakthrough products age and shrink. Compare that with some less-efficient Big Pharmas that appear farther down on the list, and you can already see the dilemma: to achieve high efficiency, a company needs to go small, but to be risk-resistant, it has to grow its portfolio. 

Biopharma companies are constantly evaluating their assets, streamlining operations, looking for ways to control costs and beefing up their options via M&A and licensing, hoping to strike a balance between how big they want to go and how comfortable they feel depending on a few blockbusters.

All of our 10 most productive companies have used these tools in recent years. Gilead got its hep C franchise through its 2011 Pharmasset buyout, and as that business declines, Gilead is now looking to grow in the burgeoning CAR-T business with last year’s Kite Pharma buy. AbbVie shelled out $20.8 billion for Pharmacyclics and its oncology portfolio, especially blockbuster Imbruvica, but it still largely depends on Humira—and some strategic Humira price hikes. Through two restructuring plans after the Schering-Plough merger, Merck & Co. had slashed about 40,900 positions by the end of 2016 and has set forth a new layoff round for 2018. Pfizer has divested its nutrition business to Nestle, spun off Zoetis and is now looking to sell its consumer health business—the fourth largest in the world.  

Pfizer is the last to make our list, with an efficiency rating of $0.55 million, but Roche, Takeda and Eli Lilly are trailing closely behind, standing at $0.53 million, $0.52 million and $0.51 million, respectively. Some recent changes could come into play for next time, including Eli Lilly’s 8%, or 3,500, job cuts announced in September aimed at $500 million in annual savings; Merck & Co.’s job cuts in sales; Takeda’s recent R&D transformation that includes swaths of new deals and transferring its drug development and postapproval capabilities to PRA Health Sciences; and, most recently, Teva’s massive cost-cutting program, which includes 14,000 layoffs. 

We’ll update when the latest round of employee numbers becomes available. In the meantime, read on, and let us know your thoughts. — Angus Liu (email/Twitter)

1. Gilead Sciences

6. AbbVie

2. Celgene

7. Bristol-Myers Squibb

3. Biogen

8. Merck & Co.

4. Amgen

9. Johnson & Johnson

5. Allergan

10. Pfizer
 

Gilead Sign

1. Gilead Sciences 

2016 employees: 9,000 
2016 revenues: $30.39 billion 
Revenue per employee: $3.37 million 

For years, Gilead has been the most efficient company in terms of revenues per employee, way ahead of the competition. Each of its employee produced $3.37 million in revenue in 2016, far larger than runner-up Celgene’s $1.57 million. But the company hasn’t always traveled over calm waters. 

Gilead’s revenue more than doubled in 2014, jumping from 2013’s $11.2 billion to $24.9 billion. It was driven primarily by its high-margin hepatitis C antiviral drugs Sovaldi and Harvoni, whose initial performance was so glamorous that the company reached a sales peak of $32.6 billion in 2015.   

The company has also been expanding its workforce—by about 1,000 every year starting from a base of approximately 6,100 in 2013. That might have worked perfectly fine if the hep C franchise had sustained its momentum, but it didn’t. As the number of chronically ill patients dwindled, and competition and pricing pressures mounted, Gilead’s hep C sales fell about 23% to $14.8 billion in 2016, and that was with the help of its new antiviral, the pan-genotypic Epclusa, which launched in the U.S. and Europe.  

Cries from investors and analysts calling for M&A emerged with the first sign of a slowdown. That was not entirely new territory for Gilead—the hep C empire itself was built on the $11 billion purchase of Pharmasset in 2011—and that was exactly what Gilead did, albeit more slowly than some analysts expected.  

In late August 2017, Gilead said it would pay $11.9 billion for Kite Pharma, which was on the verge of winning approval for a hotly anticipated CAR-T cell therapy, Yescarta. Based on the 2016 numbers, the deal wouldn’t impact Gilead’s efficiency much in the near term; Kite’s 447 employees—now more than 700, according to Gilead’s close-of-deal release—helped the company achieve revenues of $22.2 million that year.

But the deal injects new life into Gilead. Following Novartis’ Kymriah, approval for Kite’s CAR-T therapy, Yescarta, came in October. Hopes rest on it and the expected launch of Gilead’s fixed-dose HIV combo bictegravir/FTC/TAF to help fill the gap left by the hep C drugs, though the HIV triad will have to compete with GlaxoSmithKline’s recently approved two-drug regimen, Juluca. 

But a key question remains: How big will that gap be? Although the FDA in July granted blockbuster hopeful Vosevi the go-ahead, AbbVie, which already sells the Viekira family, picked up an approval in August for its eight-week, pan-genotypic treatment Mavyret. Its lower price tag and shorter treatment duration might further chip away Gilead’s share. During the third-quarter earnings call, Gilead executives cautioned that Mavyret would have a big impact on future hep C numbers. 

celgene

2. Celgene 

2016 employees: 7,132 
2016 revenues: $11.23 billion 
Revenue per employee: $1.57 million 

For years, Celgene’s story has been a Revlimid story, and that drug has kept the Big Biotech on Gilead’s heels as biopharma’s second most productive company. 

That’s partly because Celgene has successfully racked up new indications for its star drug. In 2014, Revlimid won U.S. and European approvals to treat newly diagnosed myeloma patients, bumping its sales that year by 16% to nearly $5 billion. The company’s 6,012 full-time employees helped generate 2014 total sales of $7.67 billion.  

The momentum has continued for the past two years. Sales of Revlimid jumped another 16% to $5.8 billion in 2015 and a further 20% to about $7 billion in 2016, while employee numbers were 6,971 and 7,132, respectively. For 2016, employee numbers only grew 2.3%, far less than Revlimid’s did. 

But Celgene has seen some setbacks. Revlimid fell short as a first-line treatment in chronic lymphocytic leukemia in 2013 because of trial deaths, and it failed in 2016 as a $1 billion-potential maintenance therapy in diffuse large B-cell lymphoma. Another failure came at the end of last year in non-Hodgkin lymphoma. But at least for now, the med is still expected to become the best-selling cancer drug by 2022, with global sales projected to reach about $13.5 billion, thanks to other new indications and as part of combination therapies. 

But pharma-watchers are looking for action beyond Revlimid, and as Celgene has diversified its pipeline, its headcount has grown.  

In July 2015, Celgene acquired Receptos for $7.2 billion, strengthening its inflammation and immunology portfolio. Ozanimod, which was part of that deal, beat out Biogen’s Avonex in relapsed multiple sclerosis in a phase 3, though missed a secondary endpoint in another pivotal trial. But Celgene and some analysts believed the drug’s safety profile would help it nab an FDA approval and up to $2 billion in sales. The drug is also undergoing late-stage trial in ulcerative colitis, with readouts due in 2018.

But Celgene’s inflammatory bowel disease portfolio also delivered some bad news. In October 2017, the company pulled the plug on a phase 3 Crohn’s disease trial of GED-0301, a drug it paid $710 million upfront and committed almost $2 billion to acquire from Nogra Pharma in 2014. Just days after that major trial failure, Celgene reported Otezla sales in the third quarter missed analyst prediction by $103 million, cutting back its 2020 revenue guidance from a previous target of $21 billion to between $19 billion and $20 billion.

Other deals Celgene has made include the $600 million purchase of EngMab, which focuses on T-cell bispecific antibodies, and licensing BeiGene’s PD-1 drug, while offloading its Chinese operations as well as rights to a few approved drugs—Revlimid included—in the country to BeiGene. 

biogen

3. Biogen 

2016 employees: 7,400 
2016 revenues: $11.45 billion 
Revenue per employee: $1.55 million 

Biogen has mostly kept its staff size in check for the past two years—7,400 for 2016, and 2015’s 7,350 was actually a rare cutback from 7,550 in 2014. But there was an expansion spree prior to that. The company increased its employees from 5,000 at the end of 2011 to 5,950 in 2012, and then to 6,850 in 2013 and 7,550 the next year.  

At that time, steadily rising sales of Avonex, the acquisition of full commercial rights to Tysabri from Elan in early 2013, and perhaps, more importantly, the addition of Tecfidera contributed to total revenue growth. Tecfidera was approved in the U.S. in March 2013, and it immediately delivered $876 million to the company’s top line that year; in 2014, the year it was approved in the EU, sales exceeded $2.9 billion. 

But things looked less optimistic starting from 2015. Though sales still grew 11% that year, ironically, that was also the percentage of the workforce the company said it was laying off in a restructuring effort to save $250 million in operating expenses. The money it saved would support key commercial initiatives, like that for Tecfidera, whose growth trajectory was notably going flat. The company also scrapped a phase 3 program for Tecfidera in secondary progressive multiple sclerosis, and another Tysabri study missed both primary and secondary endpoints. 

In 2016, Biogen reached a deal to sell a manufacturing plant at its headquarters in Cambridge, MA, moving work to other more efficient operations and parting ways with 250 to 285 employees, only half of whom were hired by the new plant owner. 

A similar fate met Convergence Pharma, the company Biogen paid up to $675 million to snap up in 2015. It was also shut down in 2017, and its R&D activities, including the development of a neuropathic pain candidate BIIB074 (formerly known as raxatrigine), were relocated elsewhere. 

The Big Biotech is known for its multiple sclerosis products, so it made sense when the company announced in May 2016 the plan to spin off its hemophilia business into a new publicly traded company, later known as Bioverativ. That meant sales from Alprolix and Eloctate were removed from Biogen’s financial results, leaving at least one analyst, Leerink Partners’ Geoffrey Porges, not so keen on the idea at the time. His reasoning rings more truth today, as the entire MS industry is under a pricing probe by lawmakers; and for Biogen itself, more competition, especially in the form of Roche’s Ocrevus, will likely chip away its market share. 

These days, Biogen’s portfolio also centers on spinal muscular atrophy drug Spinraza, with sales projected to reach $1.3 billion by 2022.  

Amgen flag

4. Amgen 

2016 employees: 19,200 
2016 revenues: $22.99 billion 
Revenue per employee: $1.20 million 

Amgen expanded its workforce in 2016 by about 7%, from 17,900 in 2014 to 19,200. In September 2015, it also shelled out $300 million in cash and up to $1.25 billion in milestones to acquire Netherlands-based biotech Dezima Pharma, expanding its cardiovascular portfolio with a late-stage CETP inhibitor for dyslipidemia, though it later scrapped development of that candidate.  

However, one might remember the drastic downsizing in 2014 that slashed about 15% of the company’s workforce (or 2,900 staffers) and involved the closure of several facilities in Colorado and Washington. Then, a report emerged last March that the Big Biotech was planning to reassign or lay off about 500 of the 5,500 people stationed at its headquarters as part of a reorganization. 

Thanks to good performance by the company’s backbone product Enbrel and contribution from a few other fairly new drugs, Amgen’s total revenues have been steadily growing at a mid-to-high single-digit rate, reaching $22.99 billion in 2016, compared with $17.27 billion in 2012.  

But it was not all rosy for the company’s sales. Kyprolis, which Amgen bought from Onyx for $10 billion in 2013, continued to miss analysts’ expectations, and more doubts about its future piled on as it failed as a first-line multiple myeloma treatment and Johnson & Johnson rival Darzalex entered the second-line realm. 

Then there’s Repatha, which helped make “patent” a key word in the company’s chronicles of 2016 and 2017. The PCSK9 inhibitor has been at the center of a closely watched, back-and-forth patent battle with Sanofi and Regeneron’s Praluent, which Amgen was determined to pull off the market. Neither drug has launched in the zero-to-blockbuster way the companies had hoped, making every bit of sales count. The two sides also put up another fight over blockbuster-to-be Dupixent. 

Biosimilars go hand in hand with patents. Shortly after Amgen nabbed approval in September 2016 for its first biosimilar product, Humira copycat Amjevita, it was dragged into a patent fight with AbbVie. At least that case has wrapped with a settlement that holds Amjevita’s launch off till early 2023. Also in 2016, the legal tussle Amgen had with Novartis’ Sandoz over a biosimilar of Neupogen went all the way to the U.S. Supreme Court, which later favored Sandoz and potentially all biosim developers in a historic ruling. 

On the biosimilars front, Amgen is making quick advancements, with copycats of Avastin, Herceptin, Rituxan and Remicade already approved or in development. The company has also signed deals with Daiichi Sankyo and Simcere to sell biosimilars in Japan and China, respectively. 

allergan

5. Allergan 

2016 employees: 16,700 
2016 revenues: $14.57 billion 
Revenue per employee: $0.87 million 

Instead of through hirings or layoffs, Allergan’s headcount—and hence efficiency—fluctuated over the past five years largely via acquisitions and divestures.  

Watson Pharma’s acquisition of Actavis in 2012 bumped its staff size from 6,686 to 17,700. Given the new Actavis’ revenues that year of $5.91 billion, the company’s efficiency was only $0.33 million per employee. Then in 2013, after the $8.5 billion stock-for-stock transaction for Warner Chilcott, the company’s 19,200 employees contributed $8.68 billion in revenues.  

As it turned out, those were only the prelude to the major deals that followed. 

Two Actavis purchases announced in 2014 made the largest M&A deals of the year. The approximately $28 billion acquisition for Forest Laboratories created a 21,600 person-strong company with annual revenues of $13.06 billion; that means each employee generated $0.6 million that year. 

Actavis soon beat its own record with the gigantic $66 billion Allergan buyout. After that transaction closed in 2015 and Actavis changed its name to Allergan, the company had 31,200 employees and efficiency dropped to $0.48 million/person, even though key products like Botox and Restasis helped the legacy Allergan contribute a total of $6.16 billion to the top line. It also sold two assets that year, both from the Forest acquisition—the branded respiratory business to AstraZeneca and Aptalis Pharmaceutical Technologies (known as Pharmatech) back to private equity investor TPG. 

But it’s worth noting that the rebranded Allergan had a big chunk of business not accounted for in its net revenues for 2015 but reported separately in the “discontinued operations” section. That’s its global generics business, which the company agreed that year to offload to Teva for $40 billion, including over $33 billion in cash and 100.3 million shares of Teva stock. If we took those $6.38 billion in sales back in, the company’s year-end per-person contribution would read $0.69 million for 2015. 

Allergan specified in its 2015 annual SEC filing that about 14,900 employees would transfer to the Israeli pharma. The generics transaction, which clearly wasn’t well received among Teva investors, pumped Allergan’s 2016 efficiency up to $0.87 million but dragged Teva further down.  

Today, though, Allergan itself is facing new challenges, especially with the prospect of Restasis generics. Executives in January announced the details of a cost-saving plan expected to claim 1,400 jobs—400 of which aren’t currently filled—and save between $300 million and $400 million per year in operating costs.  

Allergan has plenty of recent history with cost-slashing; it cut 577 jobs at its Irvine, California, headquarters alone as part of the $1.8 billion in savings it plotted in the wake of its Allergan takeover. 

abbvie

6. AbbVie 

2016 employees: 30,000 
2016 revenues: $25.64 billion 
Revenue per employee: $0.85 million 

AbbVie was one of very few Big Pharma companies that increased its headcount in 2016 and 2015, at least in part thanks to two oncology acquisitions—those of Stemcentrx for $9.8 billion in 2016 and of Pharmacyclics for $20.8 billion in 2015—and stellar performance posted by blockbuster meds Humira and Imbruvica. 

After adding about 2,000 employees each year, AbbVie still managed to grow its per-capita productivity from 2014’s $0.77 million to 2015’s $0.82 million and 2016’s $0.85 million. During those years, Humira sales in the U.S. jumped 28.8% and 24.1%, respectively. Exactly how important those sales are for AbbVie?  For 2016, Humira worldwide sales of $16.08 billion accounted for 62.7% of the company’s total revenues. 

However, its biosimilars are ready and waiting to launch. AbbVie has warded off the principal rival, Amjevita, through a settlement with developer Amgen that will put off the copycat’s launch in the U.S.—the primary source of Humira income—until 2023. But the biotech giant still expects to launch Amjevita in Europe next October, and Samsung Bioepis, a joint venture between Biogen and Samsung Biologics, also secured EU approval for its version, Imraldi, in August.  

When AbbVie shelled out that whopping $20.8 billion for Pharmacyclics, analysts racked their brains trying to make sense of the math; after all, AbbVie was only getting half the rights to the relatively new-to-market, first-in-class BTK inhibitor Imbruvica, and the opportunity cost was big.  

But the drug has delivered. In 2016, after nabbing an FDA green light for use as a first-line chronic lymphocytic leukemia therapy, it reeled in $1.83 billion for AbbVie. With its potential in new indications like diffuse large B-cell lymphoma, multiple myeloma, acute myeloid leukemia, pancreatic cancer and other solid tumors, Evaluate Pharma, in its World Preview 2017 report (PDF) released in June, predicted that it would be the fourth-best-selling cancer drug in 2022, returning a total of $7.50 billion for AbbVie and Johnson & Johnson. 

Meanwhile, it’ll still be some time before pipeline star Rova-T could be up for an FDA review. It’s the crown jewel from the Stemcentrx deal that executives hope could one day compensate for Humira sales loss. And there’s a relatively small savior in sight in Mavyret, a cheaper, 8-weeks-per-course, pan-genotypic hepatitis C treatment, but with Evaluate analysts predicting $1.25 billion in 2022 sales, it’s probably only going to help with falling numbers for older hep C treatment Viekira Pak. 

Bristol-Myers

7. Bristol-Myers Squibb 

2016 employees: 25,000 
2016 revenues: $19.43 billion 
Revenue per employee: $0.78 million 

Compared with 10 years ago, Bristol-Myers Squibb has dramatically slimmed down from about 42,000 employees in 2008 to 25,000 today, but it has kept that number unchanged for three years, staying clear of dramatic workforce reductions or additions. In fact, according to the company’s 2016 annual SEC filing, employment terminations incurred across all sectors were 1,100 in 2016, 1,200 in 2015 and 1,400 in 2014, and the company clearly has found new blood.  

Even with the major restructuring plan announced in October 2016 that includes site shutdowns to streamline operation and create a much more efficient workstyle, “many of the roles from Wallingford (CT), Hopewell (NJ) and Seattle will transition to other U.S. locations,” BMS previously said. It basically means that the reorganization will mainly cause relocations instead of significant change to the total headcount. Besides, BMS is also making new investments in, for example, a new R&D facility at its Lawrenceville, New Jersey, campus and expansion of its Redwood City research campus in California’s Bay Area. 

With a steady base of employees, Bristol-Myers’ efficiency shot up thanks to two powerful meds in its arsenal—Opdivo and Eliquis. How much did they help? Opdivo sales skyrocketed from $942 million in 2015 to $3.77 billion in 2016, and Eliquis’ numbers jumped from $1.86 billion to $3.34 billion over that same time frame. With those two performing, the company posted a 17% increase in total revenues for 2016.  

Opdivo failed a major first-line lung cancer trial in August 2016, prompting analysts to dial down their forecasts for its peak sales to around $10 billion to $12 billion, but that’s still higher than estimates for rival Keytruda from Merck. The two nemeses had their fair share of clinical and regulatory wins and losses in 2017, and even though Leerink Partners analysts calculated a four-percentage-point market share increase for Keytruda in the immuno-oncology space, Opdivo’s third-quarter sales managed to beat industry expectations.

And in a trial victory in February 2018 that could help even the score in lung cancer, Bristol-Myers reported that Opdivo and Yervoy in combination hit their progression-free survival goal in first-line patients with a high tumor mutation burden. The study, Checkmate-227, is continuing to assess whether the combo can prolong patients' lives, too. Details are scarce at the moment, though, and analysts are waiting for those stats, plus info on safety, before raising a cheer.

As for third-to-market next-gen anticoagulant Eliquis, which BMS shares with Pfizer, in spite of a slow start, it has unseated Johnson & Johnson’s Xarelto to become the leader in the class in terms of total prescriptions. The med further built its case against Xarelto and Boehringer Ingelheim’s Pradaxa with real-world data suggesting it could significantly lower the risk of both stroke and major bleeding and cost less money in the process. 

These pieces of good news make the patent losses of HIV drugs Reyataz and Sustiva plus a mere 58 layoffs on the marketing side less scary. Sales of each of both drugs were declining at about $200 million each year since 2014. 

merck

8. Merck & Co. 

2016 employees: 68,000 
2016 revenues: $39.81 billion 
Revenue per employee: $0.59 million 

As part of two massive restructuring plans designed to streamline the organization after its Schering-Plough merger, Merck had eliminated about 40,900 positions by the end of 2016. Though there were also a few small layoff rounds initiated in 2016, including one that reduced 148 Zontivity sales-and-marketing staffers when Merck sold the drug to Aralez, the company reported that its 2016 end-of-year headcount was the same as that of 2015.  

Merck said in its 2016 annual report that the remaining cuts would be complete by the end of 2017, but 2018 will only see another round of job eliminations. Citing “ebb and flow” of its business and an ongoing effort to refocus on “best opportunities for growth,” Merck revealed in October 2017 that it would cut 1,800 U.S. sales reps, while adding 960 to its new chronic care force. That announcement came right after the Big Pharma pulled the plug on the development of CETP inhibitor anacetrapib. It also followed decisions to can two programs in September and the costly uprifosbuvir in February in the shrinking hepatitis C realm, leaving Zepatier Merck’s only HCV med with decent performance in 2016 ($555 million) and an impressive boost to $1.66 billion in 2017. 

On average, each of Merck’s remaining 68,000 employees last year produced $0.59 million for 2016. Will those new cuts keep Merck’s efficiency afloat?  

Johnson & Johnson-partnered Remicade can’t be counted on, as copycats have already taken a significant toll on sales, especially in the EU, where Merck markets the product. Cardiovascular meds Zetia and Vytorin are falling into the same fate now, as both meds lost exclusivity in the U.S. in 2017. Their combined sales of $3.7 billion in 2016 sufficed to secure them top spots in the cardiovascular market, but copycats were estimated to take away more than $1.4 billion for 2017. And in an August evaluation, pharmaceutical commercial intelligence firm EvaluatePharma predicted Zetia’s and Vytorin’s global sales would sharply fall to only $264 million and $177 million, respectively, by 2022.

The company’s vaccines sector is more stable, especially as Gardasil/Gardasil 9 continue to show long-term efficacy; so is its diabetes franchise. The Januvia/Janumet pair raked in $6.1 billion for 2016, slightly up from 2015’s $6 billion. But Januvia couldn’t confer any CV benefits in an outcomes trial, where Eli Lilly and Boehringer Ingelheim’s Jardiance, Novo Nordisk’s Victoza and Johnson & Johnson’s Invokana have gained an advantage. Merck could soon have its own match, though, in the newly approved, Pfizer-partnered SGLT2 product Steglatro

Much of Merck’s growth will likely come from immuno-oncology star Keytruda, which has its clinical ups and downs. But importantly, the product leads its I-O rivals in the lucrative lung-cancer space, where it boasts two first-line approvals. In its World Preview 2017 report published in June, EvaluatePharma predicted Keytruda could become the world’s third-best-selling cancer med in 2022, with sales of $9.51 billion, compared with $1.4 billion in 2016. With new indications under its belt in 2017 and more on tap for 2018, it's expanding into even more markets that could be moneymakers, but where it'll continue to meet its competitors Opdivo, Roche's Tecentriq, AstraZeneca's Imfinzi and Pfizer's Bavencio head-on.

johnson

9. Johnson & Johnson 

2016 employees: 126,400 
2016 revenues: $71.89 billion 
Revenue per employee: $0.57 million 

In ecology, the term resistance stability describes an ecosystem’s ability to remain essentially unchanged in the face of disturbance. Usually, an ecosystem with high biodiversity is more capable of maintaining a steady state. Johnson & Johnson is such a gigantic ‘’ecosystem” with so many diverse products in its portfolio that some relatively big changes in numbers wouldn’t leave much of a noticeable mark. 

The pharma giant started off 2016 with a restructuring plan in its medical device segment that would cut loose 3,000 employees. Sound like a lot? That was less than 2.5% of the company’s total workforce. As it turned out, the company’s total headcount dropped 700 in 2016 from 2015. 

But J&J's pharmaceutical segment is mostly on an upward trajectory. The $30 billion deal for Actelion’s marketed meds, completed in June 2017, gave J&J some valuable pulmonary arterial hypertension assets. 

Although sales of Actelion's aging Tracleer declined by 18% in 2016, EvaluatePharma analysts still projected in August that it would only drop about 1% in annual growth to $960 million in 2022, probably thanks to J&J’s marketing reach, as CEO Alex Gorsky touted in the buyout announcement. What’s more important, newcomers Opsumit and Uptravi are making strides, raking in $259 million and $124 million, respectively, for the third quarter alone, despite a major phase 3 flop and a resolved patient deaths case. 

The company’s oncology portfolio, especially Darzalex and AbbVie-partnered Imbruvica, also represent major growth opportunities.  

First approved for fourth-line use in multiple myeloma, Darzalex has been creeping upward in the treatment lineup. In November 2016, it received FDA approval to be used in second line. At the American Society of Hematology 2017 annual meeting in December, Janssen unveiled that the med, when combined with Takeda’s Velcade, melphalan and prednisone, cut the risk of disease progression or death by 50% in newly diagnosed myeloma patients, potentially clearing its way for front-line use. Before that data, J&J already had already made $871 million in sales from the med for the first nine months of 2017. Darzalex’s success has also spurred buyout speculation targeting Genmab, from which J&J licensed the med. 

J&J’s side of Imbruvica sales of $1.37 billion in the first three quarters of 2017 already exceeded the 2016 full-year forecast of $1.25 billion—which was itself a huge jump from $689 million in 2015. And in December, the pair padded Imbruvica’s mantle cell lymphoma case with long-term data in the face of new competition from Calquence, a recently approved rival from AstraZeneca that showed strong response rates in the clinic.

Bayer-partnered anticoagulant blockbuster Xarelto also recently got a clinical boost amid fierce competition with Bristol-Myers Squibb and Pfizer’s Eliquis, showing it could slash the combined risk of death, stroke and heart attack by 24% among patients with artery disease. Credit Suisse analyst Vamil Divan, M.D., predicted that the results could drive an additional $1.5 billion in annual U.S. sales.

pfizer

10. Pfizer 

2016 employees: 96,500 
2016 revenues: $52.82 billion 
Revenue per employee: $0.55 million 

Pfizer is perhaps the most aggressive biopharma deal seeker, remembered for some of the industry’s biggest mergers and divestments. And it has almost always followed a pattern—buys that shoot up employee numbers followed by restructuring with rounds of castoffs. 

Following the gigantic Wyeth merger in 2009, Pfizer employed 116,500 people, with 42,000 from legacy Wyeth. Then it initiated a restructuring plan, spinning off its nutrition business—and about 4,500 employees—to Nestlé in 2012. By end of 2012, its total headcount had dropped to 91,500. After a divestment of its animal health business, the now-standalone Zoetis, that number fell further, to 77,700 in 2013. 

In between its failed $100 billion-plus attempts at AstraZeneca in 2014 and Allergan in 2016, Pfizer nabbed Hospira in 2015, securing a place in the burgeoning biosimilars market while swelling its employee number to 97,900. 

Now, the company is at that crossroads again. It’s currently deciding whether to offload its consumer health business, which includes big brands like Centrum and Advil and whose value, according to CEO Ian Read, has potential “to be more fully realized outside the company.” Analysts are mostly in favor of the sale, though bidders appear to be scarce at press time. The segment contributed $3.4 billion or 6.4% in revenues in 2016 and about the same amount last year. From a pure efficiency point of view, a sale of the unit would allow Pfizer to focus on other revenue drivers, like those within its oncology portfolio. 

Ibrance, for example, the first CDK 4/6 inhibitor and currently Pfizer’s No.1 growth driver, has stood firm against competition from Novartis’ newcomer Kisqali. Launched in the U.S. in February 2015, the breast cancer treatment brought in $2.14 billion for Pfizer in 2016. For 2017, it grew to $3.13 billion, and $7.07 billion is EvaluatePharma analysts’ consensus for its 2022 sales, as detailed in its World Preview 2017 report published in June.  

Fast growth from Ibrance, Bristol-Myers Squibb-partnered blood thinner Eliquis and new arthritis med Xeljanz could save Pfizer from ongoing declines for blockbuster inflammatory drug Enbrel, as well as competition against pain med Lyrica and erectile dysfunction legend Viagra as they lose exclusivity. Viagra went generic in late 2016 and sales are expected to erode markedly in 2018. Pfizer’s Remicade biosimilar Inflectra and the cancer drug Xtandi, which it picked up in its $14 billion Medivation buy, haven’t been able to pick up the slack, though some new data on the latter could be a big help.  

But divestments aren’t the only options on the table. Rumors are circling about a possible Bristol-Myers buy, and at least one analyst thinks Pfizer should nab Biogen. With higher efficiency, both companies appeared earlier in this report.

Images provided courtesy of the profiled companies.

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