Layoffs at big pharma tend to slow during the summer as most people are on vacation and nobody wants to fire folks when the kids are out of school. However, the failing economy has prompted several companies to abandon tradition and fire people during the summer anyway.

According to the Pharmalot Blog, previously announced layoffs at Merck have been accelerated and approximately 8,000 more employees will lose their jobs in early August. While the layoffs were not unexpected, those affected likely thought that they had more time before being shown the door.

In other news, Elan announced that it was laying off 104 employees at its King of Prussia, PA facility. The layoffs resulted from the sale of Élan’s manufacturing facility to Alkermes for $960 million. The acquisition gives Alkermes a chemical formulation and manufacturing business and a stake in two recently approved drugs; Ampyra for multiple sclerosis and Invega Sustenna a treatment for schizophrenia. The layoffs will occur next month and the facility will be closed in September.

Finally, a recent KPMG LLP survey of top executives of US drug makers indicates that M&A activity will continue to increase over the next several years as pharma companies attempt to offset rising generic competition and waning drug revenues. At present, roughly 70 percent of all medications sold in the US are generics. 

Eighty-three percent of the executives believe that their companies will be buyers or sellers in deals over the next two years. Further, just over half believe that it will take more than two years for the US economy to fully recover.

While M&A activity isn’t a bad thing for some companies, it is typically followed by reorganizations and massive job layoffs which are obviously not good for rank and file employees. Consequently, if I worked for a major pharma or biotechnology company, I would definitely make sure that my CV was up-to-date!

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