World’s Biggest Generic Drug Company to Cut 6,000 Jobs

Mar 27, 2017

The world’s biggest producer of generic drugs is looking to eliminate between 5,000 and 6,000 positions over the next few years,the daily Israeli newspapeCalcalistreported on March 23, without saying how it got the information.

Teva Pharmaceutical Industries Ltd.( IW 1000/199) plans to cut about 11% of its global workforce, Calcalist reported.

A 5,000-person reduction would save $2 billion, the paper said.

A spokesman for Teva declined to comment. The stock rose 1% to 119.90 shekels at 10:17 a.m. in Tel Aviv trading.

The company has already laid off about 100 employees in Israel, where it’s based, and is seeking to cut hundreds more in the coming weeks, Calcalist said.

Teva is looking for a new chief executive to turn around the business after its $40.5 billion acquisition of Allergan Plc’s generic business saddled it with debt as prices began to fall and its best-selling prescription drug faced competition. Erez Vigodman resigned as CEO last month and the company’s U.S.-traded shares are near a ten-year low.

Laying off workers at home, where the drugmaker gets tax breaks from the government, has backfired before. Former chief executive officer Jeremy Levin faced fierce resistance to his cost-cutting plans about four years ago from local politicians and unions.

“We were in a similar situation and we went to the battle,” Eliran Kozlick, the head of Teva’s workers’ committee, wrote in a Facebook post on March 23. “If the management wants to do this again, we will all work together and win as we did in the previous struggle.”

The Israeli drugmaker employed nearly 57,000 people at the end of last year, according to its annual report.

Source: IndustryWeek.com