Seeking Alpha
Profile| Send Message|
( followers)  

After a week of speculation AstraZeneca (NYSE:AZN) officially announced plans to eliminate thousands of jobs as part of a restructuring designed to save the company $1.6 billion annually by 2014. The 7,300 jobs being slashed will amount to nearly a 12 percent reduction in the company’s workforce. Approximately 3,750 jobs will be eliminated in the sales and marketing and assorted administrative operations groups, 2,200 positions will be axed from research and development, and 1,300 cuts will come from operations, says the company. Among R&D cuts, the Neuroscience department took perhaps the biggest hit, as the drugmaker detailed its intent to form a ‘virtual’ neuroscience Innovative Medicines unit that will include only a small team of scientists who will work on discovery and development externally with academic and industry partners.

A former safety consultant to Takeda Pharmaceuticals (OTCPK:TKPHF) has accused the company of deliberately neglecting to inform physicians that some of its drugs cause serious side effects when taken with other medications. Takeda’s actions resulted in many prescriptions for Takeda drugs to be written unnecessarily and caused Medicare and Medicaid to overpay for the medications, according to a lawsuit. The former safety consultant, Helen Ge, alleges that though she was hired by Takeda to review adverse events regarding its gout treatment, Uloric, the company knowingly hid the information about Uloric’s interactions for economic gain. By failing to report the adverse interactions Takeda was able to continue to market its drug as advantageous to an older medication known as allopurinol, which was about 97 percent cheaper than Uloric per pill.

Johnson & Johnson (NYSE:JNJ) received a blow when the U.K.’s cost-effective agency, the National Institute for Health and Clinical Excellence, issued a guidance recommending against the use of Zytiga, the company’s prostate cancer drug. The ruling comes even after J&J offered a discount on the expensive drug. “Zytiga is a drug that could potentially extend life by more than three months, compared with placebo. However, it is an expensive drug and the independent advisory committee that made this decision did not feel the drug provided enough benefit to patients to justify the price…even with the discount that the manufacturer has offered.” Zytiga costs about $5,000 a month.

BioSante Pharmaceuticals (BPAX) announced that it will lay off 21 full-time employees and contractors in light of recent underwhelming top-line results from a late-stage trial on its female libido gel, LibiGel. Along with the nearly 25 percent reduction in workforce as a means of saving cash, BioSante is also hoping to find an in-licenser or find an exit through a merger and acquisition deal. “We are committed to rebuilding BioSante in order to maximize value for our company and shareholders. Although we are disappointed about the recently reported LibiGel results, we are optimistic about the future of BioSante,” says BioSante CEO Stephen Simes.

Pfizer (NYSE:PFE) voluntarily recalled a batch of birth control packs after discovering that pills had been mixed up inside the packages, putting women at risk for unintended pregnancies. The company pulled 14 lots of its Lo/Ovral-28 tablets and 14 lots of a generic version of the birth control medication. In all, about 1 million packs were withdrawn from the market. Though the mix up doesn’t present any immediate health threat, the company still advises that consumers start using non-hormonal forms of birth control. “As a result of this packaging error, the daily regimen for these oral contraceptives may be incorrect and could leave women without adequate contraception. Consumers exposed to affected packaging should begin using a non-hormonal form of contraception immediately,” says Pfizer.

A group of former U.S. Food and Drug Administration scientists and doctors are suing the agency for tracking their personal emails after they had acted as whistleblowers and informed Congress that the agency was approving cancer-screening devices that they believed posed health risks to patients. The FDA began intercepting the employees’ communications with Congress through their personal Gmail accounts in 2009 and continued doing so for two years, according to the lawsuit. Though FDA computers post a visible warning to users, explaining that they should have “no reasonable expectation of privacy,” the plaintiffs believe the FDA violated their constitutional privacy rights by monitoring personal email accounts for the purpose of eavesdropping on activity that they claim was lawful.

Sweden’s Orexo was dealt a blow when Johnson & Johnson terminated the firms’ anti-inflammatory collaboration. Orexo had formed a pact with the healthcare giant’s Janssen unit focused on two drug development programs for the treatment of asthma, chronic obstructive pulmonary disease, and inflammatory disease. Orexo’s CEO, Anders Lundstrom, said that J&J’s decision was a disappointment and that the company no longer has the capital necessary to continue development of the programs on their own, forcing the company to shut them down. Had Orexo been able to meet certain milestones, the deal could have brought in $600 million.

Merrimack Pharmaceuticals postponed its initial public offering due to poor

market conditions, according to IPO research website Renaissance Capital. Merrimack had originally filed its S-1 in July 2011. With five potential treatments for cancer in clinical trials the company had planned on selling 16,666,667 shares of common stock at a target offering price range of $8 and $10 with the hopes of raising $150 million.

Source: AstraZeneca Axes 7,300 Jobs, 12% Of Workforce