The downsizing of the sales force started with Wyeth, which announced a lay off of 1,200 sales personnel in March, 2008. Later, in April, Johnson & Johnson announced 400 cuts in sales and marketing and Merck followed suit in June by cutting down 1,200 sales representatives.
Recently, Sanofi said that it will lay off 700 to 800 sales representatives, about one-third of the company’s domestic sales force. And now Boehringer Ingelheim also plans to cut around 200 neuro sales representatives after the disappointing results from the blood thinner drug study.
The revised Pharmaceutical Research and Manufacturers Association Code on Interactions with Healthcare Professionals is also partly aimed at cutting down the marketing costs. It banned the concept of free meals and laid down stringent rules in a bid to reduce the continuing medical education expenditures, which the pharma industry figures to be around $19 billion per year.
Major pharma companies like Pfizer and Novartis also have drastically reduced their sales force in recent times either to realign the company or to flatten the organization structure. According to FiercePharma, all these job cuts are part of restructuring plans designed not only to cut costs, but to streamline operations.