Eli Lilly to reorganize, trim staff
INDIANAPOLIS Drug maker Eli Lilly & Co. unveiled a plan Monday that it hopes will speed up the process of getting drugs from its pipeline to patients.
The Indianapolis-based company announced that it would establish a Development Center of Excellence to accelerate late-stage drug development while reorganizing its pharmaceutical business into five business units – for cancer, diabetes, established markets, emerging markets and animal health – and reduce costs by the end of 2011.
The company also hopes to lower costs by $1 billion and reduce its global workforce to 35,000, except for sales locations in high-growth emerging markets and Japan. According to published reports, these plans will reduce the work force by nearly 14%, or 5,500 employees.
“We remain confident that continued focus on medical innovation is the best way to ensure the long-term growth of our company,” chairman and CEO John Lechleiter said in a statement. “The changes we are announcing today will accelerate the progress of the most exciting pipeline in our history, with more than 60 molecules currently in clinical development.”
Lechleiter said the changes were needed to adapt to slowing innovation, rising costs, competition from generic drugs and patent expirations, including a series of patient expirations for key products starting in late 2011.
“While our financial performance during the past few years has been strong, we will soon enter the most challenging period in our company’s history,” Lechleiter said. “This calls for strong measures to speed our output of new medicines, better meet the changing needs of our customers and reduce our costs.”