Novartis cuts 2,000 U.S. jobs after drug setback
By Katie Reid
ZURICH (Reuters) - Novartis AG plans to axe nearly 2,000 of its U.S. workforce ahead of the patent loss of top-selling blood pressure drug Diovan there and will take a $900 million charge after another of its key drugs failed to live up to expectations.
Novartis is the latest in a long line of global drugmakers to cut its sales force as the industry faces its biggest wave of patent expiries ever.
The Swiss drugmaker's news comes just weeks after AstraZeneca said it was slashing nearly a quarter of its U.S. sales force in a second round of job cuts in as many months, while Sanofi has also said it is cutting back on its sales force there.
Novartis plans to shed 1,630 jobs in its U.S. field force and another 330 positions are expected to go as it reorganizes the headquarters of its U.S. general medicines business. The changes are expected to take place in the second quarter of this year.
Diovan, which sells $6 billion a year, went off patent in Europe last year and it will lose exclusivity in the United States this September. Japan follows in 2013.
The Basel-based group expects the restructuring measures, which will result in a one-off charge of $160 million in the first quarter of 2012, to claw back annual savings of around $450 million by 2013.
Novartis' latest round of redundancies comes only a few months after it said it was cutting 2,000 jobs in Switzerland and the United States to keep costs under control in the face of growing price pressures.
The company has already cut thousands of jobs and shut several sites, notably in Britain. In 2010, it said it was cutting 1,400 jobs in the United States as it focuses increasingly on specialty medicines to boost profitability. Continued...