March 24, 2015
By Mark Terry, BioSpace.com Breaking News Staff
Tokyo-based Daiichi Sankyo, Inc., which has U.S. headquarters in Parsippany, N.J., announced today it will begin laying off 16 percent of its U.S. staff starting Monday March 30. It is also planning additional layoffs to begin mid-April.
According to the company’s nine month report of March 31, 2015, North American revenue increased 6.0 percent from the previous year to ¥168.1 billion. However, in local currency, revenue fell 1.5 percent to $1.573 billion (U.S.). Sales of the company’s drugs, Venofer and Injectafer increased, but sales of Benicar/Benicar HCT dropped due to increased competition.
Benicar and Benicar HCT are treatments for high blood pressure. Venofer and Injectafer are both treatments for anemia.
Also, the company stated in the report that it was “placed under investigation by the U.S. Department of Justice in relation to physician speaker programs conducted as part of the promotional activities for mainstay products.” The company settled with Justice and other government agencies and paid a settlement of approximately $39 million.
The company was accused of violating the False Claims Act, wining and dining physicians and offering lucrative speaking deals to improperly encourage them to prescribe Axor, Benicar, Tribenzor and Welchol.
“This settlement sends the message loud and clear: My office will hold accountable companies that attempt to improperly influence physicians for the benefit of their bottom line,” said New York state Attorney General Eric Schneiderman in a statement. “A physician’s decision concerning what drugs to prescribe should be based on what is best for the patient, not what perks they may get from a drug company.”
Also of major concern affecting staffing is that two of the company’s patents are expiring this year and next. Cholesterol medication Welchol expires in June and blood pressure medication Benicar loses patent protection in 2016. Benicar accounts for 27 percent of Daiichi’s sales in the last fiscal year, accounting for $2.6 billion.
“Following a thorough review of our business,” said Kimberley Wix, company spokeswoman in a statement, “we have made the decision to reorganize our operations, which includes the difficult step of select workforce reductions.”
On March 19, 2015, Daiichi Sankyo announced a co-commercialization agreement with London-based AstraZeneca PLC worth $825 million. That deal is for Movantik (naloxegol), a once-daily peripherally-acting Mu-Opioid receptor antagonist (PAMORA) designed for the treatment of opioid-induced constipation resulting from treatment of chronic pain related to cancer. That drug has Marketing Authorization in Europe under the name Moventig. The deal will push for U.S. commercialization.
Details regarding additional cuts at the company’s U.S. facility are still being made, but Wix stated that, “Final decisions regarding the field sales staff will be made by mid-April.”
BioSpace Temperature Poll
U.K.-based GlaxoSmithKline filed a WARN letter in late February with the state of Pennsylvania indicating another 150 people would be laid off in its commercial and research and development group near Philadelphia. BioSpace wants to know if you think Pharm Country will do what it takes to keep biotech jobs in the area?
