October 19, 2009

AstraZeneca Offers Buyouts To Entire Sales Force

I don't often comment on the ebb and flow of pharma corporate news, but via Pharmalot comes news that AstraZeneca is asking its entire US sales force--some 5,000 to 6,000 people--to "self identify" whether or not they want to accept a buyout from the pharma giant. Don't think that AZ is getting out of the drug business, but like a lot of pharma companies it faces several products going off-patent over the next few years (Seroquel, Crestor, etc.), so it's cutting costs where it can. Quite a few pharma companies (lilly, BMS, AZ) are facing a serious "pipeline problem" of not having new drugs forthcoming to market to the public.

As a longtime critic of Big Pharma, I find it rather odd that there have been no new product introductions of "breakthrough" drugs in recent years after decades of seeming innovation. In the mental health world, it sure does strike me that pharma has stopped trying to churn out new anti-depressants (aside from the Effexor-knockoff Pristiq), perhaps because there is no more commerical advantage to be wrung out of the chemical imbalance hypothesis of depression. At least in a patented product sense of things.

But, who knows? Perhaps pharma will surprise me some day soon.

Posted by Philip Dawdy at October 19, 2009 10:16 AM
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I wonder if all the research indicating that exercise is just as effective -- if not more so -- than meds for depression is sinking in, not just with the public, but with Big Pharma CEO's. Maybe they are realizing they can't bamboozle the world with thier bullshit marketing claims any more.

Posted by: Tom at October 19, 2009 10:55 AM

I don't see this as reflective of any big cultural change (unfortunately) but rather a part of the normal business cycle.

Posted by: kimbriel at October 19, 2009 11:25 AM

Tom - that evidence has been the case for years. The trend has been for ever greater rates of med prescriptions. --My guess: one: little that is promising in the pipeline as a few meds go off-line; two: reduce work force by attrition now rather than en masse later can avoid a lot of bad feelings; three: you would not want hundreds of people with bad feelings about your dirty laundry to go spread your dirty laundry; four: if the work force is needed in the future, it is easy to get the work force: you rehire, and/or hire and train new biology grads that happen to have that drug-rep look and persuasive manner. OR: pharma plans to convert the positions to independent-contractor positions. Which makes sense. A contractor-rep could sign an agreement to not represent similar drugs. So one rep could represent a psych med from one company, and a cholesterol med from another company. A decent rep could maintain a steady income, while there would be no pharmaceutical company wondering how it would build up or down a rep work force.

Posted by: medsvstherapy at October 19, 2009 12:56 PM

Perhaps DTC (Direct To Consumer) and online drug purchases will replace sales by detail men/drug reps.

Posted by: Lilly NC at October 19, 2009 05:08 PM

I'm not going to research this and have no evidence to back up my conclusion, but that's never stopped anyone from posting on the internet, so let me throw this out anyway.

Most new drugs in the US come from academic research at the large public research universities. This research is paid for by government subsidies. Original research is too expensive and too exotic for drug companies, who are generally there to put the drugs through full-blown clinical trials and to figure out how to manufacture the new compounds economically. This is something that is commonly known.

However, for the last eight years or so, the federal government's been financing expensive wars and it seems to have had less and less money to support activities here at home. I have no statistics to back this up, but if there has been lack of financing for new research, then fewer and fewer new drugs would be coming to market.

I despise psychiatric drugs about as much as anybody else here, but technically this isn't something to celebrate. For this American, the US losing its scientific and technological position in the world--because we've sat around and eaten our seed corn--is something to be very concerned about :-(

Or at least, that's my two cents'.

Posted by: marlborojones at October 19, 2009 06:28 PM

Thanks medvstherapy. You are probably right. But I wonder: Why don't health clubs and fitness centers start marketing direct to consumers about the anti-depressant effects of exercise? It would seem to be a logical (and profitable) move to make. Moreover, they could champion exercise as a promoter of erections and libido to boot!

Posted by: Tom at October 19, 2009 07:01 PM

As a longtime critic of Big Pharma, I find it rather odd that there have been no new product introductions of "breakthrough" drugs in recent years after decades of seeming innovation.

Oh come on, if you've been studying this for a long time, then you know that every organ system has several drugs to treat whatever. Law of diminishing returns - hard to get a breakthrough when there are several good drugs already. You're left with either orphan diseases, or complex genetic diseases and individualized medicine.

In the mental health world, it sure does strike me that pharma has stopped trying to churn out new anti-depressants (aside from the Effexor-knockoff Pristiq),

What, just because new drugs haven't come to market? Maybe that's an FDA problem, not a drug company problem?

Depression is a big market - plenty of money to be made if you can develop a better anti-depressant. Research is going on with new receptor types (e.g., melatonergic), three at once (S+N+D), and more ideas.


perhaps because there is no more commerical advantage to be wrung out of the chemical imbalance hypothesis of depression. At least in a patented product sense of things.

The chemical imbalance hypothesis is clearly wrong and everyone knows it. Although that hypothesis did result in several drugs.

That's not a problem, it's an opportunity. If you can figure out what causes depression, you might be able to develop novel drugs to alleviate it.

There is a real need today for better drugs - ones that work faster, and have better side effect profiles. The brain is so complex that we'll be learning more about it for a long time.

Posted by: Blackeneth at October 19, 2009 08:37 PM

Fitness clubs marketing their benefits as antidepressant, pro-libido: great idea; the evidence is there. I don't know why they don't run things like that in their ads. They generally seem very body-image conscious, and avoid marketing that portrays us ordinary people. Maybe they don't want a bunch of mopey people in the gym.

Posted by: medsvstherapy at October 20, 2009 07:52 AM

At least in the realm of psychiatric meds, the US companies are doing paltry little research. The current norm is to buy a product that was researched and developed overseas and slap a US patent on it. They've adopted the Hollywood model of rehashing successful movies from France, Japan, etc and resetting them in America.

Posted by: Dark Jay at October 20, 2009 09:13 AM
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