Pharma’s house of cards
Anglo-Swedish drug company AstraZeneca has announced plans to cut roughly 700 jobs at its site in Macclesfield, UK. A further 850 staff will go at Swedish production facilities. The news marks the first step in the implementation of the company’s plans to cut 3000 jobs from its worldwide workforce and streamline its operation.
Hot on the heels of this grim news for employees came another more dramatic downsizing announcement. German drug maker Bayer has said it plans to slash its worldwide workforce by 6100 or 5.5 per cent. This follows its acquisition of Schering, which will be integrated into its healthcare unit.
Pfizer’s restructuring announcement earlier this year lifted the lid on what has now become a sweeping series of changes across the pharmaceutical industry.
According to Bayer, just over half of its planned job cuts will be in Europe and around 1000 in the US. Asia, Latin America and Canada will also be affected. There will be a reduction of 1400 global research and development (R&D) and 1850 production posts by 2009. Around 2850 administrative positions will go.
Bayer described the move as an essential streamlining measure and said that it had been clear from the outset that the integration would involve job cuts.
US pharmaceutical company Abbott Laboratories has joined this increasing list of companies making strategic changes. They announced their intention to ’reshape’ their drug discovery strategy and to cut around 200 US research jobs in the process.
Abbott has decided to stop R&D into metabolic diseases altogether, focusing instead on specific areas of its remaining research programmes, including infection, immunology, neuroscience and oncology.
A spokesperson for AstraZeneca told Chemistry World that the majority of its planned job cuts would be in manufacturing and distribution rather than R&D. ’Pharma is under a lot of pressure from expiring patents and pipeline expansion is our main priority,’ he said.
Cushioning the blow slightly, for the UK at least, was the news that the company will invest $120 million (£60 million) in a new process research and development laboratory at its Macclesfield site.
Victoria Gill
FDA acts on unapproved drugs
The US Food and Drug Administration (FDA) has issued a caution to 20 companies for marketing and selling unapproved drugs. The drugs in question contain ergotamine tartrate, a vasoconstrictor used to treat vascular headaches or migraines. According to an FDA spokesperson, the companies ’completely bypassed the system’ - marketing prescription drugs containing the compound that had not been tested or approved. Each company has been sent a letter by the FDA telling them to conduct the mandatory safety tests or stop selling the products.
Shire’s £1.3 billion boost
Shire, the UK’s third largest pharmaceutical company, has signed an acquisition deal with New River Pharmaceuticals. Shire had previously entered into a collaborative deal with the US company to develop their Attention deficit and hyperactivity disorder (ADHD) treatment, Vyvanse. Shire now has full control over the drug, which recently received FDA approval. Shire is the largest seller of ADHD drugs in the US, a market that the company estimates at $3.3 billion annually.
Pfizer wholesaling deal investigated
The UK Office of Fair Trading (OFT) is investigating a controversial deal between Pfizer and UniChem, the wholesaling arm of Alliance Boots. This month, UniChem became the sole distributor of the US pharmaceutical giant’s drug products. British drug wholesalers launched a last-ditch legal action to try to block the deal, claiming it would unfairly restrict competition in the UK. The attempt was rejected by the High Court. Pfizer said it welcomed the court’s decision and was confident that the new distribution deal was ’in full compliance with all applicable EU and UK laws’. Eli Lilly and AstraZeneca are reported to be considering similar deals to give them more control over supply chain.
Thailand promises more generics
Thailand is likely to expand its use of cheaper, generic versions of patented drugs, according to the country’s health minister, Mongkol Na Songkhla. The minister, who recently granted licenses for Thai companies to produce generic versions of two patented treatments, announced plans to grant similar licenses for the production of generic versions of 14 drugs for HIV, cancer and heart conditions. US company Abbott Laboratories has responded by announcing its decision not to market new medicines in Thailand.
Lyondell sells titanium dioxide
US chemical company Lyondell has signed an agreement to sell its titanium dioxide business to a Saudi Arabian competitor for $1.2 billion. Lyondell’s Millennium Inorganic Chemicals subsidiary is the world’s second largest producer of the white pigment after DuPont, and operates plants in Europe, Australia and the Americas. It will be sold to National Titanium Dioxide, also known as Cristal, the number nine producer, operating a single plant in Yanbu, Saudi Arabia.
Vioxx trial blow for Merck
A jury has awarded $47.5 million to an Idaho man after finding that the anti-inflammatory drug Vioxx, made by Merck and Co., Inc., contributed to his heart attack.
Postal worker Frederick Humeston and his wife received $20 million in compensation and $27.5 million in punitive damages in the retrial, having lost their first trial against the US pharmaceutical company in 2005. Humeston had taken Vioxx to relieve knee pain from a shrapnel injury sustained in Vietnam, and suffered a heart attack in September 2001, several months before Merck put stronger warnings about the risks of taking Vioxx on the drug’s packaging.
Merck subsequently took Vioxx off the market in September 2004 after their own research showed the drug could increase the risks of heart attack and stroke. Merck has now won nine cases and lost five in ongoing litigation around Vioxx. But it faces roughly 28,000 cases over the drug. The company plans to appeal the decision in this latest case.
West Nile virus screening tool approved
The FDA has approved a new system to screen donated blood and organs for the West Nile virus (WNV). Procleix Tigris, developed by Swiss drug company Novartis, is the first fully automated nucleic acid testing system, which Novartis says will ensure the rapid supply of virus-screened blood to hospitals throughout the US.
WNV is a mosquito-borne virus with symptoms ranging from mild, flu-like to severe neurological disease. According to the US Centers for Disease Control and Prevention, there have been more than 19 000 human cases of WNV infection reported since 2003, including 644 deaths.
PET anti-dumping duties imposed
The European Council has imposed anti-dumping duties on imports of polyethylene terephthalate (PET) from India, Indonesia, Malaysia, The Republic of Korea, Thailand and Taiwan.
The decision has been welcomed by PlasticsEurope, an association representing European plastics manufacturers. They say it will encourage investment in recycling projects and R&D and that the measures will have a minimal effect on the end-user price of PET.
Biofuel merger
Two US biofuel companies, Diversa and Celunol, are planning to merge, creating a new company they say will be the leader in the emerging cellulosic ethanol industry.
The combined company aims to develop the first commercial cellulosic ethanol plant, producing ethanol biofuel from cellulosic raw materials. Celunol has already started operating a cellulosic ethanol pilot facility in Jennings, Louisiana, US.
Akzo Nobel sells pharma business
US drug giant Schering-Plough is to buy Dutch chemical company Akzo Nobel’s pharmaceuticals and animal health business, Organon BioSciences, for €11 billion (£7.5 billion).
The news was greeted with a 6.3 per cent hike in ICI’s share price amid predictions that Akzo Nobel would use the proceeds to bid for its UK peer. Akzo Nobel has said it was looking to make acquisitions that made ’strategic sense.’
Charm defensive
Luxury venues are feeling the effects of tough ethical rules that crack down on pharmaceutical companies plying doctors with lavish dinners and days out, according to a report in the Financial Times. US drug firm Abbott was last year suspended from the Association of the British Pharmaceutical Industry for hosting events at Wimbledon, organising trips to greyhound racing and visits to a lap dancing club.
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