Sanofi has been hit hard by pricing pressure in diabetes, and now the drugmaker’s U.S. sales force is set for another round of job cuts.
A spokeswoman said the company is “re-aligning” its sales employees’ “commercial approach to adapt with changing market dynamics.” The company will start the layoffs in June. Sanofi doesn’t “know at this time how many employees will be impacted,” she added. All layoffs will be in the U.S.
Sanofi has been among a number of drugmakers hit by pricing pressure in diabetes in recent years. The layoffs come after the company reported a decline in 2018 sales versus 2017. For years, its diabetes outfit has been a drag, and the unit again lost ground last year. Diabetes sales slipped 13.8% to €4.5 billion in 2018. Back in 2014 and 2015, Sanofi’s diabetes group generated more than €7 billion in sales.
Amid that pressure, the French pharma has implemented a few rounds of layoffs. Last January, the company said it would cut 400 U.S. sales jobs to “adapt to the ever-changing market.” Back in 2016, Sanofi unveiled a plan to cut 20% of its U.S. diabetes sales force, or hundreds of jobs. In February 2016, the company said it would eliminate 500 positions in France. Late last year, the company planned 670 layoffs in France.
Sanofi will offer employees affected by the layoffs severance pay, health benefits and outplacement services. They can also apply for other positions in the company, Sanofi’s spokeswoman said.
Growing rebates to middlemen have been a big part of the problem for diabetes drugmakers. In February, Sanofi disclosed that it raised prices on 35 medicines last year, but that its average net prices in the U.S. fell 8%. In all, the company paid out 55% of gross sales in the form of rebates, including $4.5 billion in mandated rebates to government payers and $7.3 billion in “discretionary rebates.”
Sanofi isn’t alone, of course. Insulin rival Eli Lilly recently said the sticker price for its Humalog grew 52% over five years, but that its net price slipped 8%. Eli Lilly in 2017 announced a restructuring aimed at chopping 3,500 jobs. Novo Nordisk has suffered from pricing pressure as well; that company also responded in part by cutting costs.
On the flip side at Sanofi, the company’s Genzyme unit has been on a tear, growing sales more than 30% last year to €7.23 billion. Vaccines have also been a reliable performer in recent years.
By Eric Sagonowsky
Source: Fierce Pharma
Lonza will invest to expand its drug product manufacturing network in Switzerland. The investment will include installation of a new aseptic fill and finish line in Stein and the expansion of Drug Product Services in Basel. The expansion adds new capabilities to support clinical and commercial manufacturing and enhances existing drug product service offering in Basel and Visp.
Partial reprogramming of adult heart cells to a fetal-like state could help repair heart damage following cardiac injury or disease, scientists at the Max Planck Institute for Heart and Lung Research showed in mice.
When Merck’s women’s health spinoff Organon launched in June, it promised to listen to—and amplify—women’s voices on overlooked health concerns. Now, the company is getting specific. Organon hopes to ignite a conversation about an issue that affects 121 million women around the world every year.