Ailing AstraZeneca to cut one in 10 jobs

Thu Mar 21, 2013 9:49am EDT
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By Ben Hirschler

LONDON (Reuters) - AstraZeneca's new chief executive announced another 2,300 job cuts in sales and administration on Thursday as he set out his stall for turning round the struggling drugmaker and returning it to growth.

The latest cutbacks mean the group will shed around a tenth of its workforce, or 5,050 jobs, by 2016 as expiring drug patents shrink sales and it faces generic competition on several top-selling medicines.

Pascal Soriot said he had no quick fix for the company and ruled out the idea of diversifying away from prescription drugs, as several rivals have done. He plans instead to invest in scientific research to replenish a sparse new drug pipeline.

It promises to be a long haul. Still, AstraZeneca believes it can double the number of drugs in late-stage development by 2016 and by 2018 it expects revenue to "significantly exceed" the current market consensus of $21.5 billion.

Research efforts will in future focus on three main disease areas and AstraZeneca will strike more external deals - following a $240 million tie-up with Moderna Therapeutics - to bring in new products, particularly in specialty medicine.

A key figure in getting deals done will be new hire Marc Dunoyer, who is joining from rival drugmaker GlaxoSmithKline as head of global portfolio and product strategy.

Investors may be reluctant to give Soriot too much credit until they see concrete signs of new drugs nearing the market.

MOUNTAIN TO CLIMB   Continued...

A worker leaves the AstraZeneca research facility in Loughborough, March 2, 2010. REUTERS/Darren Staples