Pfizer Inc. is laying off 300 professionals or 11 per cent of its Canadian workforce as the drug multinational reduces its costs to soothe the revenue erosion from expired patents such as its blockbuster cholesterol-lowering drug Lipitor.
A majority of the job cuts will occur in sales and marketing, according to Rhonda O’Gallagher, executive director, corporate communications at Pfizer Canada Inc.
Hardest hit will be the primary care unit. Primary care drugs are prescribed by family doctors and other general physicians.
The pharmaceutical company’s Canadian headquarters, located in Kirkland, in Montreal’s West Island, will also suffer as a consequence. About 600 of the affiliate’s 2,700 jobs are based there.
“We have been forced to adjust our sales force to reflect the changes the pharmaceutical industry is undergoing, namely the loss of patent protection on bestselling drugs,” Ms. O’Gallagher said. The layoff announcements will be completed by the end of this week.
Once again, Quebec is severely impacted by the worldwide restructuring of the pharmaceutical industry – although Ms. O’Gallagher was unable to give out the exact geographical breakdown of the job cuts which will be felt across the country.
The province has been hit by a series of lab closures in an industry that was long the pride of Quebec. In September, the German drug maker Boehringer Ingelheim announced that it will shut down by early 2013 its Laval research facility, which employs 170 lab workers.
This news was on the heels of the lab closures of the past two years at AstraZeneca (132 jobs), Sanofi-Aventis Canada (100 jobs), Johnson & Johnson (125 jobs), the former Wyeth-Ayerst (150 jobs) and Merck (200 jobs).
In a study just released last week, Rx&D, the Canadian association of research-based pharmaceutical companies, noted that its Quebec members employed 5,320 professionnals directly. The association hadn’t updated its figures in years, but at last count, in 2008, Quebec pharmaceutical companies employed 9,000 people.
Multinational drug makers have been cutting research budgets and outsourcing research and development as they struggle to replace best-selling drugs with new molecules. New drugs cost more and more to develop, but their applications are often limited and they have often not lived up to their promises.
Throughout the years, Quebec attracted a number of research-based pharmaceutical companies through its generous research and development tax credits and drug reimbursement policy. Once a drug has made it on the province’s accepted list of medications, Quebec will reimburse its full cost for 15 years even if its patent expires and cheaper generic alternatives are available to patients.
In the past year, however, the Liberal and now the Parti Québécois government have been openly musing about ending this costly industrial policy, given the precarious state of the province’s finances and the apparent poor return on investment. The “15-year policy,” as it is known, cost the province $193-million in 2011-12, up from $162-million in the previous fiscal year.
“Clearly, the series of closures [in the pharmaceutical industry] represents a concern, but we haven’t made up our minds yet on the actions we intend to take,” said Suzanne Lalande, press officer for Élaine Zakaïb, Quebec’s new industrial policy minister.
The industry hopes to keep those measures in place as Quebec and, more widely, Canada are faced with steep competition from new pharmaceutical powerhouses such as India. “The policies that have been in place for the past 25 years have been good to promote research and development in Quebec, and we hope to keep them,” said Isabelle Robillard, spokesperson for Rx&D.