Eli Lilly to Freeze Base Pay for Most Employees in 2014

 

Eli Lilly's CEO John Lechleiter was out for a couple of months as he dealt with some heart issues. He recently returned, and guess what he brought with him? More bad news for employees.

The Indianapolis drugmaker, which just let 40% of its U.S. sales force go, has told everyone left standing there will be no pay raises this year, according to Bloomberg. The Wall Street Journal reported that Lilly will also reduce bonuses paid in 2015. The company told Bloomberg it expects to save about $400 million through 2016. All workers, including execs, will see their pay frozen. Only some workers who live outside of the country will be spared the freeze. The company last year had more than 38,500 employees. 

The actions are being taken ahead of the patent losses on antidepressant Cymbalta, its best-selling drug, and Evista, a drug for osteoporosis and breast cancer. Spokesman Ed Sagebiel told Bloomberg that the company expects to lose 20% of its global revenue in 2014 with the loss of patents on those two products. "While we've taken many actions to reduce costs and become a leaner organization, we must do more," he said.  

Cymbalta last year brought in just shy of $5 billion, $4 billion of that in the U.S., but it will lose patent protection at the end of 2013. It was slated to go off patent June 30, but Lilly last year won a 6-month extension after testing the drug for treating depression in adolescents through the FDA pediatric-exclusivity program. The blockbuster Evista will go off patent next year.  

Lilly's first-quarter earnings actually beat Wall Street forecasts, but much of that occurred from cost cuts. About 1,000 sales folks were told in April they were being let go; their last day was Monday.
Lilly is trying to overcome its problems with new drugs but keeps falling short. Late-stage drugs for Alzheimer's disease and rheumatoid arthritis fell short in key trials, and the company scrapped a schizophrenia program. Lilly has made a huge bet on insulin, and there is some upbeat news from that area. It has four new products in development, including one that could give Sanofi's ($SNY) Lantus a run for its money. It is expanding the sales force in that treatment area, and it is investing about $320 million in a new insulin plant.

Lechleiter left about two month ago for surgery on a dilated aorta, handing over the reins to CFO Derica Rice. He returned to Lilly this month "with renewed energy and enthusiasm," according to the company.

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Pharma Sales – It’s a Different World

Pharma sales reps in the U.S. nearly doubled to 100,000 between 1996 and 2005 even though the number of practicing physicians rose by just 26%. If you observed the world of Pharma sales in a rear view mirror, growth was the name of the game. Today, Pharma sales forces are being downsized. The Wall St. Journal, for example, reports that Eli Lilly has cut its US sales force by 30% so far this year as it prepare for two of its biggest drugs – Cymbalta and Evista – to face generic competition. AstraZeneca announced it would cut 1,600 jobs over the next three years. There are a number of reasons why these companies are reducing the size of their sales forces. An important one is the mindset of Physicians. Some have had to increase the number of patients they see so they no longer have time to talk with sales reps. Others will refuse to see pharma reps even if they have the time. And a growing number of physicians prefer to receive their information online. On the other side of the table with fewer sales reps seeing physicians face-to-face, physicians have come to accept the new normal – fewer free office lunches, reduction in paid speaker programs, and cuts in dollars paid for pharmaceutical and marketing research. If you were to fast-forward to a picture of tomorrow these images are likely to be even more dramatically different. PWC identified seven major socio-economic trends that will have huge implications for the industry as a whole:

1. The burden of chronic disease is soaring.
2. Healthcare policy-makers and payers are increasingly mandating or influencing what doctors can prescribe.
3. Pay-for-performance is on the rise.
4. The boundaries between different forms of healthcare are blurring.
5. The demand for medicines in the developing world is likely to grow rapidly.
6. Many governments are beginning to focus on prevention rather than treatment although they’re not yet invested very much in pre-emptive measures.
7. Regulators are becoming more risk-averse. Added to these trends is the observation that many physicians have no history of the past.

According to Dr. Robert Steinbrook at the Yale School of Medicine, “There are many more doctors-in-training over the last five to ten years who have trained in environments with less drug-industry involvement than comparable students might have had a decade earlier.” This all means how Pharma sale reps are selected and trained will need to look strikingly different as the future unfolds. Companies that crack the code on exactly how tomorrow’s sales force will provide value to physicians will have a distinct competitor advantage.

Roche and AstraZeneca launch medicinal chemistry data-sharing consortium to further accelerate drug discovery

Roche and AstraZeneca announced a new collaboration to share a specific type of early research data related to drug design, which could further accelerate the discovery of high quality compounds with an increased chance of clinical success. Using a dedicated technology (Matched Molecular Pair Analysis, MMPA) modifications will be identified, which companies can apply to their compound structures in order to improve their metabolism, pharmacokinetics or safety, without divulging confidential information about their chemical structures. This gives both companies the opportunity to efficiently reapply useful medicinal chemistry know-how embedded in their combined databases of experimental results, in order to identify potential new drug candidates using fewer rounds of design, synthesis and testing. Both Roche and AstraZeneca will make their selected databases available for this type of joint analysis and are committed to making the data generated available to the broader research community, including research foundations, charities and academia.

Commenting on this collaboration, Luca Santarelli, Head of Neuroscience and Small Molecule Research at Roche, said: "It is unique in the history of our industry that two major players are sharing their know-how at such an early stage of research. We believe that this transparency of small molecule optimization knowledge, in a smart and thoughtful way, could profoundly enhance our ability to design drugs, be of benefit for all parties involved and ultimately help bring better medicines to patients."

"AstraZeneca has taken multiple steps to both open our compound libraries to those wishing to find exciting new chemistries for early drug discovery and to share compound related datasets that will allow our industry to speed the discovery of new medicines," said Mike Snowden, head of Discovery Sciences in Innovative Medicines and Early Development (IMED), which initiated the collaboration. "Researching a potential new medicine is a long race that we strive to complete with urgency to fill unmet medical need. We are making these data sets available in the belief that – when paired with findings from other companies through a common platform – we can reach our patients faster with medicines that make a meaningful difference to their lives."

The data-sharing will be managed through the intermediary company, MedChemica, which has expertise in the key technology of MMPA. The consortium is open to other large companies to add their knowledge thereby gaining access to and enhancing this resource.  More data added to this system will raise the quality and specificity of drug design rules.

Alexander Dossetter, Managing Director at MedChemica said, 'We congratulate both companies for taking the courageous first step of sharing medicinal chemistry knowledge. We aim to expand this kind of collaboration and eventually go beyond facilitating chemical building blocks into chemical lead hunting and optimization.  The goal is that resources will be better utilized and patients better served."

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The Pharma Phenomenon of the Sales-Rep-Turned-Product-Manager

By Wendy Blackburn*

 

There’s this interesting thing in the pharmaceutical marketing world where sales reps magically morph into marketers. I’m not sure how it began (and its not exactly magic, as you’ll read), but it’s been that way as long as I can remember successful sales reps reach a certain point in their career where they leave the field to come into home office and do a rotation in market research or brand management. Some of them learn the ropes and go on to be great marketers. Others flounder their way through marketing their brand for a few years until they get moved on to something else.

People from outside the pharma industry often marvel at this insane phenomenon these sales-rep-turned-marketers have no advertising, product management, or marketing experience and receive little training. How are they expected to be successful? 

The smartest ones, I’ve observed, learn to ask a lot of questions. They lean on peers and their agencies. They’re smart, and they know they need to think differently. And they embrace the challenge of learning something new.

The unsuccessful ones, I’ve observed, don’t admit what they don’t know. They ignore market research if they don’t agree with it. They make erratic decisions, and no one knows how those decisions were arrived upon. They don’t like the color green so they don’t want to see it in the creative comps. They have a brand-centric sales mentality instead of patient-centric one. They set tactical goals for the year – “I need to do one new sales aid. I need to launch a Facebook page.” – and spend the year checking off those goals come hell or high water. And they often aren’t comfortable with technology so they stay away from blending too much digital into their marketing mix. Sigh.

Here’s my theory:  It’s not really their fault. Sales reps – by training – are reticent to admit they don’t know something. In fact, that’s really hard for a lot of people to do. The business world demands confidence. It demands people that can make quick decisions, can command a room, and sell anyone on an idea – whether that idea is good or bad. These reps are used to being all about the brand – not the patient. And they’re probably only in this gig for a few years anyway so why invest the energy to learn something new, take risks, or fight for something?

In my opinion, that’s a pretty sad state of affairs. We should all be learning, growing, asking questions, and fighting for what we believe in. When we stop doing that, the spark is gone and we’re just going through the motions. That’s the place where bad campaigns are born. It’s where great ideas go to die. And it’s where big pharma forgets that patients are their ultimate customers.

Are you one of these sales-rep-turned-product-manager phenomenons? If so, take a look in the mirror. What type of legacy will you leave behind? 

Wendy Blackburn is an Executive Vice President at Intouch Solutions, a leading pharmaceutical marketing agency.

Top 10 Pharma Giants Now Hiring

Nine of the 10 companies hired the highest numbers of employees in the United States, but there was also significant hiring overseas, especially in China and Europe. 

Following is a list of 10 pharmaceutical giants, ranked by their numbers of available jobs as posted on their corporate websites the week of June 17–21. Companies are listed with their total numbers of jobs worldwide, total number of jobs in the nation with the highest number, percentage of jobs accounted for by the top nation, the next five (or in Eli Lilly’s case, four) nations with jobs posted on the company’s website, and the percent of available jobs accounted for by those nations.

The results show both the U.S.’ continuing dominance of the industry, since nine of 10 companies hired the highest numbers of employees Stateside—as well as significant hiring overseas, especially in China (which dominated Eli Lilly’s listings of available jobs) and Europe.

Belgium was the top nation after the U.S. in listings posted by two pharma giants, GlaxoSmithKline and Johnson & Johnson’s Janssen Pharmaceuticals unit. J&J numbers reflect Janssen job postings, since that unit specializes in prescription drug development worldwide. Also placing among next-five nations of most pharmas were three of Europe’s four biopharma powerhouses, the U.K. (seven of 10 companies), France and Germany (five each). The fourth, Switzerland, was a top-five hiring choice of just the two pharmas headquartered in that nation, Novartis and Roche.

After China and Europe, several nations figure in a few companies’ job postings: Canada and Mexico are among next-five countries of two companies, as are Australia and Singapore. So too is the Netherlands. But the presence of Poland and Ukraine indicate that Eastern Europe will have at least some future in the hiring plans of biopharmas, as will the Middle East and Asia (India, Taiwan).

The listings cannot say if companies truly plan to fill every one of those hundreds and hundreds of listed positions; hiring plans are often as volatile as the economy and drug discovery ups-and-downs. And some of the listed jobs may have already been filled by the time you read this. But the job listings can be viewed as a barometer of enduring big pharma health, at least in the business areas still seen as pharma strengths, such as business development, project engineering, technical services, and quality control—even as most of the industry giants have laid off thousands of R&D and sales staffers in recent years, while some are planning new rounds of workforce reductions.

#10. Bristol-Myers Squibb

368 total worldwide jobs listed on website

Top nation: U.S., with 318 jobs listed on website

U.S. % of available jobs: 86.4%

Next five countries: Ireland and United Kingdom (12 jobs each); France (9)1; Belgium (7); Spain (5)

Next five countries % of available jobs: 12.2%

#9. Eli Lilly2

484 total worldwide jobs listed on website

Top nation: China, with 319 jobs listed on website2

China % of available jobs: 65.9%

Next four countries2: U.S. (146 jobs); Canada (16); Australia (2); U.K. (1)

Next four countries % of available jobs: 34.1%

#8. AstraZeneca3

544 total worldwide jobs listed on website3

Top nation: U.S., with 259 jobs listed on website3

U.S. % of available jobs: 47.6%

Next five countries: China (202 jobs); U.K. (55)3; France (11); Turkey (8); Sweden (7)

Next five countries % of available jobs: 52.0%

#7. AbbVie

555 total worldwide jobs listed on website

Top nation: U.S., with 367 jobs listed on website

U.S. % of available jobs: 66.1%

Next five countries: Germany (68 jobs); China (28); France (20); U.K. (16); The Netherlands (14)

Next five countries % of available jobs: 26.3%

#6. Johnson & Johnson / Janssen Pharmaceuticals

655 total worldwide jobs listed on website

Top nation: U.S., with 232 jobs listed on website

U.S. % of available jobs: 35.4%

Next five countries: Belgium (81 jobs); China (63); The Netherlands (40); Mexico (30); France (26)

Next five countries % of available jobs: 36.6%

#5. GlaxoSmithKline

733 total worldwide jobs listed on website

Top nation: U.S., with 223 jobs listed on website

U.S. % of available jobs: 30.4%

Next five countries: Belgium (174 jobs); U.K. (114); Singapore (55); Australia and Germany (33 each)

Next five countries % of available jobs: 55.8%

#4. Pfizer

815 total worldwide jobs listed on website

Top nation: U.S., with 332 jobs listed on website

U.S. % of available jobs: 40.7%

Next five countries: China (249 jobs); U.K. (26); Mexico (18); Taiwan (17); Ukraine (16)

Next five countries % of available jobs: 40.0%

#3. Sanofi4

1,427 total worldwide jobs listed on website4

Top nation: U.S., with 744 jobs listed on website

U.S. % of available jobs: 52.1%

Next five countries: China (465 jobs); France (68); Germany (51); Canada (45); U.K. (18)

Next five countries % of available jobs: 45.3%

#2. Roche

1,450 total worldwide jobs listed on website

Top nation: U.S., with 591 jobs listed on website

U.S. % of available jobs: 40.8%

Next five countries: Switzerland (240 jobs); Germany (192); China (148); Poland and Singapore (40 each)

Next five countries % of available jobs: 45.5%

#1. Novartis

2,740 total worldwide jobs listed on website

Top nation: U.S., with 1,096 jobs listed on website

U.S. % of available jobs: 40.0%

Next five countries: Switzerland (500 jobs); Germany (224); U.K. (127); India (113); Austria (109)

Next five countries % of available jobs: 39.2%

Notes:

¹ For France, available jobs include two “European headquarters” positions based in Rueil-Malmaison, a suburb of Paris
² Figures include three Lilly subsidiaries, Avid Radiopharmaceuticals, ImClone, and Elanco (Animal Health). Chinese figure includes 307 jobs posted in Chinese and an additional 12 in English. Following China, only four additional countries had jobs posted on the company’s website
³ Figures combine jobs listed by AstraZeneca and its subsidiary MedImmune. Total worldwide jobs include 411 listed by AstraZeneca and 133 by MedImmune. U.S. jobs include 148 listed by AstraZeneca and 111 by MedImmune. U.K. figure includes 33 listed by AstraZeneca and 22 by MedImmune.
⁴ Includes combined figures for Sanofi, Sanofi-Aventis, Sanofi-Pasteur, Sanofi-Pasteur MSD, Genzyme, Merial, and Zentiva. Not all countries disclosed available jobs on websites, though all figures come from official websites of Sanofi and subsidiaries

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Top 10 pharma companies by employees

Being the largest company by any number of measures--revenues, earnings, those kinds of yardsticks--is a good thing. Being the largest by number of employees is trickier, unless yours is also the largest by those other measures. As we have seen time and again in recent years in the pharma industry, having lots of employees and falling revenues is a formula that leads to layoffs.

As a whole, the top 10 companies had fewer employees at the end of 2012 than at the end of 2011. The contraction was not as large as you might expect given the effects of patent losses for such huge blockbusters as Pfizer's  Lipitor, which went off near the end of 2011, or Merck's  Singulair. Total employment at reporting time was 921,375 last year, only 5,500 employees fewer than the year before. That is only an 0. 6% reduction.

GENESIS Pharma: Κορυφαία Ευρωπαϊκή διάκριση για τον Κων. Ευριπίδη

Την υψηλότερη ευρωπαϊκή διάκριση για τη δέσμευση στελέχους στην ποιότητα, έλαβε ο Διευθύνων Σύμβουλος της Genesis Pharma και ιδρυτικό στέλεχος της εταιρίας κ. Κωνσταντίνος Ευριπίδης, από τον Ευρωπαϊκό Οργανισμό για την Ποιότητα European Organisation for Quality (EOQ), μετά από αξιολόγηση 20 Quality Leaders από όλη την Ευρώπη. Η τελετή απονομής πραγματοποιήθηκε την Τρίτη 18 Ιουνίου, στο Ταλίν της Εσθονίας στο πλαίσιο του 57ου Ευρωπαϊκού Συνεδρίου Ποιότητας.