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December 10, 2007
More Belts Tighten
OK, let's get the layoff news out of the way for the week. Late last week, Bristol-Myers Squibb announced some long-expected cutbacks. And I know some people in research over there have been rather jumpy, but it looks like this round isn't going to hit the labs. From the sound of it, manufacturing is going to take the brunt of this one.
And that's not good, but it's arguably a better indicator for the company's future than laying off research staff would be. Generally that's one of the last areas to cut for a large company, at least for a large company that plans to discover any drugs. (Which makes you wonder what Johnson & Johnson has been up to, doesn't it?) BMS seems to have decided that its future is in its current strong therapeutic areas, and is narrowing down to make sure that these have enough resources. Good luck to them; I hope it works.
Of course, they're also talking about freeing up some money for partnerships and acquisitions, which is a bit more problematic. Companies this size can do very well bringing in particular drugs that a smaller partner might not have the resources to market, but I hope the company's management isn't picturing some grander strategy. (They don't seem to be planning on getting bought, which is a start). Great Big Visionary Moves in this industry don't have a good history. The time lag of drug development makes them difficult to assess, and difficult to correct when they go wrong. Here's hoping that BMS sticks to what they're good at for now, and that they're correct in identifying just what that is. . .
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