Novartis to axe nearly 2,000 US jobs

Swiss pharmaceutical firm Novartis Pharmaceuticals is to cut nearly 2,000 jobs in the US as it faces the patent loss of hypertension treatment Diovan (valsartin).

The firm also expects lower sales for Rasilez/Tekturna (aliskiren) after a clinical study reduced expectations for the drug’s use in a group of patients with type 2 diabetes and renal impairment.

David Epstein, division head of Novartis Pharmaceuticals, said the decision was ‘difficult but necessary’ yet would free up resources to invest in the future of the business, adding that the next two years would be ‘challenging’.

Novartis will cut its US sales force by 1,630 and approximately 330 positions are expected to go as it reorganises the headquarters of its US general medicines business.

The changes are expected to take effect in the second quarter of 2012.

The restructuring will result in an exceptional charge of approximately US$160m in the first quarter of 2012, to make annual savings of approximately $450m by 2013.

A reassessment of the future sales potential of Rasilez/Tekturna in light of the results of the Altitude clinical study led to an exceptional charge of approximately $900m in the fourth quarter of 2011.

In addition, as part of an ongoing portfolio review, Novartis will take an exceptional charge of approximately $160m related to termination of PRT128 (elinogrel) and SMC021(oral calcitonin) programmes.