Pfizer cutting 6,000 jobs in latest restructuring initiative
Pfizer said today that it would cut another 6,000 jobs, part of a long-standing effort to reduce its manufacturing and research footprint as the pharmaceutical industry endures a continuous contraction.
Pfizer is slashing eight drug manufacturing sites and reducing its personnel at six other locations, according to the Wall Street Journal. The cuts come more than three years after Pfizer announced that it would shutter its 174-acre Ann Arbor campus, displacing more than 2,100 workers.
Michigan avoided the latest round of Pfizer cuts, which are due partly to consolidation efforts related to Pfizer's 2009 acquisition of competitor Wyeth.
Pfizer won't make cuts in the Kalamazoo area, where it employs nearly 3,000 workers, according to the Kalamazoo Gazette.
But the global contraction is likely to continue as Pfizer braces for the expiration of its Lipitor patent, intellectual property originally developed in Ann Arbor.
The cuts are necessary to offset an expected dip in sales when the Lipitor patent expires in 2011, the Wall Street Journal said, but investors are still wary of Pfizer's limited drug development pipeline. The publication reported:
The cuts are part of the company's larger plan to eliminate more than 19,000 jobs by the end of 2012, a goal the company remains on track to meet, said Ray Kerins, Pfizer's vice president of external affairs. Pfizer is aiming to reduce its costs by $4 billion to $5 billion by the end of 2012, he said.
The company set its job-cut goal in January 2009 when it announced its acquisition of Wyeth. At the time, the companies had a combined staff of 130,000. By the end of the first quarter, the staffing level was down to 113,800.
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
Comments
John Galt
Wed, May 19, 2010 : 10:39 a.m.
BasicBob: I agree. The Pfizer "business strategy" seems to be to buy companies, fire the employees and strip other companies of research. They exist very much like a pirate. First it was Warner Lambert. Then Pharmacia. Now it is Wyeth. All along the way they fire people, close sites and destroy independant research efforts. We are left with less independant research (fewer companies performing distict research programs). Less jobs. And more money for the executives. All the while creating little to nothing. Even the stockholders see the share price fall from a split adusted $50 to less than $16.
Basic Bob
Tue, May 18, 2010 : 6:49 p.m.
I see a different pattern. Buy competitors and dump employees to enhance shareholder equity. Don't worry about actually building a company or developing products. At some point the stock analysts will see that Pfizer has no real plan for the future and the strategy will fail. Except if they have assimilated every single one of their big pharma competitors.
ex734
Tue, May 18, 2010 : 5 p.m.
Correct me if I'm wrong curtis, but the measuring benefit/toxicity is all part of the phase 2 and 3 period. They simply cannot foresee these problems until that stage which is why most drugs ultimately fail. Otherwise, I'm not quite sure what your point is.
Curtis A. Bagne
Tue, May 18, 2010 : 4:14 p.m.
Familiar pattern with a familiar result: Pfizer announced the closure of R&D in Michigan with the loss of 2410 high-paying jobs shortly after the failure of torcetrapib in a Phase III trial for cholesterol management. Now Pfizer announces cutting 6,000 jobs mostly elsewhere shortly after the failure of Dimebon in a Phase III trial for Alzheimers disease. Same root cause: Trying to develop drugs without measuring the benefit/harm of pharmacotherapy for individual patients with chronic health problems. Why not try measuring the benefit/harm of pharmacotherapy while developing, regulating, and using drugs?