Eli Lilly, the US-based pharmaceutical company plans to cut more than 5,000 in its bid to cut company cost and expenditures, which is compounded by uncertainty of the pharmaceutical market. The company is also bracing itself for tough challenge from its fierce competitors, especially in the field of genetic drugs, and its failure to launch a new series of drugs is making things worse.
The patent for four of Eli Lilly’s top selling products will be expiring between 2010 and 2013, which will open a floodgate for competitors who would be rushing to produce similar range of products. A patented product or technology cannot be produced or manufactured by other companies other than the patent owner, but once the patent expires, everyone will have access to the technology, possibly creating a market saturation.
The 5,000 workforce represents nearly 15% of its current total workforce, with the job cut expected to save the company about USD $1 billion. Incidentally, earlier this year, Lilly was slapped with a record fine after found guilty of illegally marketing its best selling product, Zyprexa, a medication for atypical antipsychotic. The fine amounted to over $1 billion USD, the largest criminal penalty ever imposed in the United States.
Publicly traded in the New York Stock Exchange (NYSE), Eli Lilly is known for its contribution in being the first company in the world to produce penicillin, the antibiotic for bacterial infections, in mass volume. It is ranked as the 148th largest companies in the US for the year 2008, and 10th largest pharmaceutical company in the world in terms of sales.