Pfizer axes 10,000 jobs in cost-cutting bid

The cuts in the workforce will be spread across Pfizer’s operations around the world. From 2003 to 2008, Pfizer said it will have reduced its network of manufacturing plants from 93 to 48.

In the US, Pfizer will close down two manufacturing plants and three research centers. Research centers in Japan and France will be closed and Pfizer said it is considering selling a factory in Germany.

The plan will cut annual spending by $500 million to $1 billion, the company said. The cuts come after Pfizer reported that its earnings for the fourth quarter fell to 43 cents a share from 49 cents a share in the same period a year earlier, with generic drugs being blamed for diminishing revenues. Key drugs in Pfizer’s pipeline such as Zoloft have lost patent protection, therefore losing sales as cheaper generic alternatives have taken over the market.

“We are facing significant challenges in a profoundly changing business environment. I believe we must fundamentally change the way we run our company to meet these challenges and to take advantage of the diverse and attractive opportunities that we see in the marketplace,” said chairman and CEO Jeffrey Kindler.

Pfizer also said the changes were an attempt to maximize its revenues and that it was simplifying the organizational structure of its research and development.

“Our simplified structure will help drive the growth of our expanding pipeline – including our goal to deliver four new internally generated products per year by 2011 – while maintaining current R&D investment levels,” said Dr John LaMattina, the head of Pfizer Global Research and Development.

As a result of these changes Pfizer expects its earnings will increase by between 6% and 9% in both 2007 and 2008.