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[DewDiligence]

PFE to Axe Another 2,400 US Sales Reps

[This is about 1/3 of PFE’s US salesforce. These layoffs are in addition to the 800 jobs in R&D (#msg-34786258). Industry-wide, there are now 90K US sales reps, down from a peak of 105K in 2006.]

http://online.wsj.com/article/SB123212608532390787.html

›JANUARY 17, 2009
By JONATHAN D. ROCKOFF

Pfizer Inc. plans to lay off as many as 2,400 salespeople in the U.S., or as much as a third of its field force, according to a person familiar with the matter.

The cuts are likely to knock the drug industry's leading employer of sales representatives from the top spot, said Jaideep Bajaj, managing director of ZS Associates, a sales and marketing consulting firm.

In a statement, Pfizer said it wouldn't comment about "rumors or speculation," but it added that it was continually looking to operate in a "more effective and efficient way." The cutbacks will include sales representatives and middle managers and are to be completed this quarter, the person familiar with the matter said.

Pharmaceutical companies have been slashing sales jobs built up more than a decade ago, when blockbusters like Pfizer's cholesterol fighter Lipitor were prescribed mainly by primary-care doctors. Companies hired so many sales reps that as many as a half-dozen might end up calling on the same doctor to tout the same product.

While the push worked initially to boost sales, it became less successful as growing numbers of reps crowded waiting rooms. Companies began slashing sales forces when their top sellers began to face cutthroat competition from less expensive generics. Sales jobs in the U.S. drug industry have dropped to about 90,000 now from a peak of 105,000 in the 2006 first quarter, Mr. Bajaj said.

Pfizer has eliminated more than 15,000 jobs since January 2007. The sales-layoff plans, which were reported by Bloomberg News, are part of a strategy announced in October to divide Pfizer's commercial operations into smaller, largely autonomous business units focusing on specific areas, such as primary care and emerging markets.‹