Pfizer Aiming for 30,900 Layoffs Through 2012
Pfizer (PFE) has laid off 26,300 employees since 2005, and hopes eventually to lay off a total of 30,900 through 2012, according to its 10-Q filing with the SEC.
The company had several rounds of layoffs before its acquisition of Wyeth in an attempt to get $6 billion in annual savings out of its business model. The company has said it wants to ax about 19,500 jobs to make the Wyeth merger work. The new company will have about 130,000 workers. The layoffs are ongoing, Pfizer said:
In the third quarter of 2009, we reduced our workforce by approximately 1,100 employees and, in the first nine months of 2009, we reduced our workforce by approximately 6,500 employees.
Pfizer gives two sets of costs related to all those layoffs. On page 9 the company says:
During the first nine months of 2009 we expensed $200 million for Employee termination costs …
That would mean it costs about $30,769 per employee in severance payments and benefits. But on page 33, in a discussion of workforce reduction, Pfizer adds:
During the third quarter of 2009, we incurred costs related to this cost-reduction initiative of $141 million and, in the first nine months of 2009, we incurred costs related to this cost-reduction initiative of $802 million.
That works out at about $123,385 per employee — a similar sum associated with Merck’s layoff program.
And finally: Although Pfizer’s troubles with the states and the feds over Bextra are all wrapped up, shareholders have just gotten started. A number of shareholder derivative actions have been filed. Pfizer said:
These actions allege that the individual defendants breached fiduciary duties by causing or allowing Pfizer to engage in off-label promotion of certain drugs, including Bextra.
Jim Edwards, a former managing editor of Adweek, has covered drug marketing at Brandweek for four years, and is a former Knight-Bagehot fellow at Columbia University's business and journalism schools. Follow him on Twitter or send him an email.
BNET User Analysis