Bio-Pharma R&D Jobs At Risk, CRO's Licking Their Chops
There have been two very interesting news bits today in research and development in drug and bio-health companies. The ramifications are also rather scary if you have been monitoring this segment over the last few years as one of the few havens in high-pay medical and bio-health jobs.
- Today the WSJ reported that GlaxoSmithkline (NYSE: GSK) informed employees that the drug giant may cut 850 jobs in R&D, or about 6% of that segment as part of its ongoing cost cutting measures.
- Pfizer (NYSE: PFE) is also cutting R&D. It is abandoning its early-stage work in heart disease, and is dropping research projects in obesity and bone density, but seeks for partners to carry on the work. The company is targeting 15-20 regulatory submissions in the period 2010-2012.
In the very recent past we have noted how Eli Lilly & CO. (NYSE: LLY) signed an agreement with contract research organization Covance Inc. (NYSE: CVD) in a transformation of Lilly’s current R&D model.
This may be bad for new-hire wages in the R&D arena in the biohealth sector. This all may bode well for all of the medical and bio-health contract research organization (CRO’s). Here are some stocks with CRO as their main operations or with significant exposure:
- Charles River Laboratories International Inc. (NYSE: CRL)
- Covance Inc. (NYSE: CVD)
- Parexel International Corp. (NASDAQ: PRXL)
- Pharmaceutical Product Development Inc. (NASDAQ: PPDI)
- PharmaNet Development Group Inc. (NASDAQ: PDGI)
Between this wave of cutting R&D personnel and the flood of biotech mergers, it looks as though things are changing wildly in R&D.
Jon C. Ogg
September 30, 2008
Bio-Pharma R&D Jobs At Risk, CRO's Licking Their Chops
There have been two very interesting news bits today in research and development in drug and bio-health companies. The ramifications are also rather scary if you have been monitoring this segment over the last few years as one of the few havens in high-pay medical and bio-health jobs.
- Today the WSJ reported that GlaxoSmithkline (NYSE: GSK) informed employees that the drug giant may cut 850 jobs in R&D, or about 6% of that segment as part of its ongoing cost cutting measures.
- Pfizer (NYSE: PFE) is also cutting R&D. It is abandoning its early-stage work in heart disease, and is dropping research projects in obesity and bone density, but seeks for partners to carry on the work. The company is targeting 15-20 regulatory submissions in the period 2010-2012.
In the very recent past we have noted how Eli Lilly & CO. (NYSE: LLY) signed an agreement with contract research organization Covance Inc. (NYSE: CVD) in a transformation of Lilly’s current R&D model.
This may be bad for new-hire wages in the R&D arena in the biohealth sector. This all may bode well for all of the medical and bio-health contract research organization (CRO’s). Here are some stocks with CRO as their main operations or with significant exposure:
- Charles River Laboratories International Inc. (NYSE: CRL)
- Covance Inc. (NYSE: CVD)
- Parexel International Corp. (NASDAQ: PRXL)
- Pharmaceutical Product Development Inc. (NASDAQ: PPDI)
- PharmaNet Development Group Inc. (NASDAQ: PDGI)
Between this wave of cutting R&D personnel and the flood of biotech mergers, it looks as though things are changing wildly in R&D.
Jon C. Ogg
September 30, 2008
When Drug Firms Add ex-FDA Chiefs to Payrolls
GlaxoSmithkline (NYSE: GSK) has appointed Dan Troy as Senior Vice President and General Counsel for the company with an effective hire date of September 2, 2008.
Normally a general counsel hiring doesn’t mean much, but this one is a headline grabber if you believe that drug companies have to have a good clear line into the FDA. Mr. Troy was formerly Chief Counsel for the US Food and Drug Administration, where he served as a primary liaison to the White House and the US Department of Health and Human Services.
He led an office of attorneys who reviewed and approved all major regulations, and oversaw the legislative implications of many of the most important issues facing the pharmaceutical industry. Some issues were the reform of the Hatch-Waxman Act and subsequent legislative ratification, and his office also approved and managed all agency litigation and established new procedures for the FDA legal team to follow in preparing and then litigating high-profile cases.
We usually call this “bringing in the former enemy.”
Jon Ogg
July 22, 2008
Cervical Cancer Vaccine Developments Altering Big Pharma (MRK, SNY, GSK)
The new cervicval cancer vaccine market has been a boon for Big Pharma as a revenue stream that had not previously been there. Merck’s (NYSE: MRK) Gardasil, developed with Sanofi-Aventis (NYSE: SNY), is now apparently set to keep its lead position in the cervical cancer vaccine market. This lead should be maintained in principal but now its secondary competition is going to be pushed out even farther.
GlaxoSmithKline PLC (NYSE: GSK) has said today that it does not expect the FDA to approve its Cervarix, Glaxo’s cervical cancer vaccine. It believes that it will now not see FDA approval until 2009. Many analysts had modelled revenues reaching in the low-hundreds of millions as soon as 2008. This additional delay is going to assist Merck in keeping its leadership role in cervical cancer vaccines.
Gardasil is estimated at $2.5 Billion sales annually with 2007 sales being listed as $1.5 Billion for the first full year.
Jon C. Ogg
June 30, 2008
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