A Thanksgiving Tradition Continues

A Thanksgiving Tradition Continues

There are certain Thanksgiving traditions that never seem to change. The annual family get together, football, Black Friday and of course turkey. In the pharmaceutical industry there is another tradition only these are called layoffs. Yes no matter where you turn rumors are rampant that this Thanksgiving will be particularly brutal. Already we know that Sanofi (NYSE:SNY) will be swinging the layoff ax as they stated as much during their investor day. Olivier did not provide a number yet kept mentioning that the costs in diabetes franchise would reflect the new and lower sales guidance.

The same is true at AstraZeneca (NYSE:AZN) a company that continues to struggle in diabetes. Yet layoffs are not just impacting companies that are struggling as Novo Nordisk (NYSE:NVO) has already eliminated some position and Lilly (NYSE:LLY) is said to be considering such a move.

The harsh reality is that sales people are just too expensive and quite frankly their function once critical is becoming less important. Even worse all the companies are following the increasing political rhetoric on the high cost of drugs and sense that whoever wins the White House good times do not lie ahead. Combine that with the fact that the diabetes drug market is commoditizing and well it’s just not a pretty picture.

It should also be noted that the battle once fought in the physician office is now being fought at the payors office. Back in the old days a company needed an army of sales reps as the physician had input into which drugs a patient used. Today this is no longer the case as physicians are often handcuffed by the patient’s coverage as to which drugs they can and cannot use.

Now Diabetic Investor does not know the extent of the coming carnage all we know is that it’s coming and more than one company will be impacted.