Sunday, April 06, 2008

More layoffs, cuts as U.S. drug makers face generics, other woes

From CBC News:
U.S. drugmakers beset by growing generic competition, few new blockbusters, drug safety concerns and pressure from insurers and government health programs to discount prices are cutting tens of thousands of jobs.

Nearly all of the 10 largest pharmaceutical companies in the U.S. are restructuring, with some, such as Schering-Plough Corp., announcing plans to trim 10 per cent or more of the work force.

Since 2007, eight of the world's biggest drugmakers have announced the elimination of more than 42,000 jobs; two other major companies have eliminated another 12,200 jobs in the last few years.

"There are a lot of things going on making this the perfect storm for the industry," said Argus Research health-care analyst Martha Freitag. "My sense is maybe we're halfway through" the cost-cutting.

Today's struggles come after the industry's golden era in the 1990s, when a slew of new drugs quickly became blockbusters, fuelling almost routine double-digit quarterly profit increases and rising stock prices and dividends. ...more

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