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Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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April 6, 2010

Let's Hope They're Right

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Posted by Derek

For what it's worth, here's a report that tallies up the layoff numbers in the industry so far this year as compared to 2009. And even though the first two months of the year featured plenty of job cuts, we're still well off last year's horrendous pace. March had the lowest number of layoffs in some time.

How you look at this news depends on whether you're a glass-half-full type or not. Perhaps there just aren't so many people to cut any more, at least not at early-2009 rates. But it may be that things have bottomed out. The real question will be whether the industry can get back to adding jobs in the US.

Comments (35) + TrackBacks (0) | Category: Business and Markets


1. Sili on April 6, 2010 8:06 AM writes...

Well, at some point there'll be noöne left to lay off. I imagine that'd slow down the rate ...

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2. numbers on April 6, 2010 8:19 AM writes...

The public numbers don't tell the whole story. Some companies don't release the numbers of people let-go, only that there are re-organizations or restructurings.

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3. RB Woodweird on April 6, 2010 9:27 AM writes...

The MBAs are like the aliens, scrambling about in the colony looking for humans to eviscerate. The last medicinal chemist is the little blonde girl hiding from them down in the bilge.

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4. MIMD on April 6, 2010 10:31 AM writes...

I think a more pertinent question is: is the industry in a death spiral? The cuts already made will not exactly increase discovery, through loss of expertise and experience, and loss of morale.

I think of layoffs like a GI bleed. You first get anemic and weak.

If you don't stop the bleeding and heal the bleed site, you die.

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5. Karen on April 6, 2010 10:33 AM writes...

I'm not convinced that this report is correct. For one thing, it says that Pfizer "finished" their cost cutting earlier in the quarter, but I know they laid off over a hundred at Pearl River in late March. (It's possible those were included in earlier numbers since the cuts had been predicted.)

And Sanofi just announced layoffs today.

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6. pharmagossip on April 6, 2010 11:50 AM writes...

Add 400 US Sanofi Aventis drug reps.....

Plenty of jobs in India and China tho'...

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7. startup on April 6, 2010 12:36 PM writes...

Let's be realistic, these jobs are not coming back.

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8. Chemjobber on April 6, 2010 12:48 PM writes...

And if/when they do, it will be in smaller companies and lower wages, with fewer benefits. Bold prediction, I know, but I expect there to be fewer large pharmas in 5 years than there are right now.

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9. anchor on April 6, 2010 12:48 PM writes...

Dereck : This is like government keeping an account of weekly unemployment figures. People who follow these statistics, know that they just don't add up. Same here and am in total agreement with Sili and startup.

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10. ex-Pfizerite on April 6, 2010 12:50 PM writes...

I agree with MIMD, unless drug discovery becomes more efficient with much fewer Phase 3 failures, the pharma industry will be in a death spiral.

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11. Spectrochimico on April 6, 2010 1:53 PM writes...

Fantastic! Now I'll only have an additonal 25,000 unemployed experienced scientists to compete against for a job rather than 50,000.

I'm feeling more optimistic already.

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12. milkshake on April 6, 2010 3:20 PM writes...

Some of the jobs will come back from the academia having collaboration with big pharma. The catch is that the academia jobs will be at a postdoc salary. These days medicinal chemists cannot be picky if they want to have a job at all. I say, decent academic institute or a startup is still preferable to the grind of a CRO.

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13. anon on April 6, 2010 4:51 PM writes...


Milkshake, you've worked in the academic setting. Your salary wasn't all that bad, am I correct from your other web writings? What was the case for the rest of your colleagues?

I ask because I have known several BS/MS folks who have been techs/scientists in academia either all of their working lives or for long periods of time. They didn't make six-figure pay, but they made far more than post-doc salary, and many made very nice salaries.

Academia dosen't offer all the opportunities/salary that pharma does, but, it can be good for some folks.

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14. milkshake on April 6, 2010 5:49 PM writes...

My position was not common, I started at SUGEN at 70k and got to 82k after few years. I was hired by Celera and they paid me something like 87k because they really wanted me. My ex-boss from SUGEN soon asked me to move to Florida to start a medchem lab for him there at Scripps and he got me additional 5k raise to come over. From 92k after 5 and half years at Scripps my salalry got to something like 105k which is what a MS chemist would have at a large pharma if he spend there his whole career and get recognized for his good work.

My colleagues and bosses who joined Scripps FL later and were deemed less essential by the old management got less generous offers. (It is never good if you work for a boss who makes the same as you do. There were whispers, and I suppose my former boss probably leaked my salary figure to my colleagues as a way to get even with me when I fought him over a publication.)

Academia: low salary or not, its still better than being unemployed

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15. Anonymous on April 7, 2010 3:09 AM writes...

"I think of layoffs like a GI bleed. You first get anemic and weak. If you don't stop the bleeding and heal the bleed site, you die."

I like to think of the MBAs as a nice big dose of Plavix applied to this situation. I'm sure it's all going to work out just fine.........

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16. fungus on April 7, 2010 3:31 AM writes...

Assuming they don't go back into pharma, what types of careers have the laid-off chemists been getting themselves into? Teaching? Business?

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17. Jose on April 7, 2010 6:50 AM writes...

Word on the street (chemjobber?) is that ALL teaching positions everywhere are fully saturated, even at the HS and community college level. As for business, we're likely to be heavily outgunned by quan finance MBA secret-handshake types.... modelers might have an easier time of things than syn jocks.

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18. Anonymous on April 7, 2010 7:56 AM writes...

After selling their surplus internal organs on the internet they're mostly just dying quietly.

I'm only half joking. Teaching at high-school level has adsorbed many but after that most scientists are there with the rest of the less-skilled masses. No obvious opportunities.

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19. cynical1 on April 7, 2010 9:44 AM writes...

@ Fungus #16: Next time I get the boot, I'm thinking of going back to school to become a murse (male nurse). I figure working as a non-PhD medicinal chemist for 25 years has uniquely qualified me to be pissed on and clean up other people's crap all day. In a little time (especially with my background), I'll know more than my bosses and I'll be unappreciated and professionally ignored. Sounds like a perfect fit.

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20. Chemjobber on April 7, 2010 9:56 AM writes...

I've heard about saturation for the university/college academic positions, but not for the community college and/or high school positions.

That being said, I heard anecdotal evidence that it wasn't easy to get hired as a CC instructor in organic chemistry a couple of years ago. I can't imagine that it's gotten easier either on the supply or demand side.

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21. Hap on April 7, 2010 10:41 AM writes...

NPR had a recent story on nurses - the educational opportunities aren't available, probably (my guess) because nurses can make more working than they can teaching, and schools are unwilling to pay enough in salaries to get them to teach unless they can charge much more for their teaching. And while lots of people are probably flooding into CCs (because places like CA have shredded their state college enrollments), there probably isn't any money to pay anyone.

School districts are having mixed success getting any money (some success here in OH), but even then at least some of the money is contingent on renegotiating teacher contracts (driving their pay down, and, such as in NJ, to try to break the teacher's unions, which I'm sure will make teaching an even more popular destination for qualified applicants). I'm not guessing there are many jobs.

As a whiny side note, people claim lots that the point of a Ph.D. is the ability to engage a variety of scientific topics and to conduct research in them, yet that flexibility seems not to correlate with what they are hired for. Ph.D.s seem to be hired for particular research knowledge, and fired when their expertise is no longer needed. The flexibility that is theoretically the point of the degree is not only unrewarded, but penalized. Is this assessment accurate?

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22. Keith on April 7, 2010 11:19 AM writes...

HAP's comments about misuse of PhD's strikes home, most corporate hiring has degenerated into the art of picking people who have the exact qualifications and experience to perform a specific function at a specific time. All of the 'requirements' expressed in a vague way as "needs to be able to hit the ground running" etc. are a good indicator that what is wanted is someone to "turn the crank" on an existing troubled project, not someone capable of competently investigating unexplored areas. "Blue sky" research has largely been abandoned in favour of "applied research"; translation, research immediately capable of generating or increasing current revenue and profit. The real problem is that corporate executives are not paid for long term thinking, but for quarterly 'improvements' in profits, whether or not the profits are real.

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23. Chemjobber on April 7, 2010 11:27 AM writes...

Hap's assessment of the nursing instructor shortage is exactly right: the pay for nursing instructors just isn't high enough, especially compared to the amounts that working nurses can garner.

Of all the medical/scientific fields, I suspect that nursing has the best ROI on education. That being said, nursing salaries can't keep going up forever.

Re PhDs, I agree with Keith: witness Pfizer's recent chemistry hiring, which appears to be very specific (R3/R4 PET imaging, R6 nucleotide synthesis group leader.)

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24. anonymous on April 7, 2010 12:23 PM writes...

Based on comments about the pharma industry over the past few months, is it safe to assume if you want to work in pharma your interests are better served sticking with a BS or at most, getting an MS rather than a Ph.D?

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25. Anonymous on April 7, 2010 2:57 PM writes...

"Based on comments about the pharma industry over the past few months, is it safe to assume if you want to work in pharma your interests are better served sticking with a BS or at most, getting an MS rather than a Ph.D?"

No those are exactly the jobs that are being shipped out to Chindia.

Chemistry is now a no-win scenario. You will not make it from the end of your university education (at whatever level) through to retirement, even with multiple employers. Sooner or later your skills will be replacable with the year's whizz-bang technology (that won't work, but hey, who cares). So don't go there. Stay clear of chemistry.

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26. Anonymous on April 7, 2010 7:03 PM writes...

I have a question. I may have up to 2 years as a contractor. (med chemist, PhD). I am mid 40's and I am thinking of getting my MBA at night. Is it worth the time and money? I should be through most of the program before my contract is up. I have little faith that I will ever get another permanent chemist position. Thank you in advance for any help!

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27. Chemjobber on April 7, 2010 10:01 PM writes...

Anon: Check out my linked handle to get some reaction from chemists on the MBA degree.

Good luck on the contracting -- that sucks.

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28. milkshake on April 8, 2010 6:56 AM writes...

lets hope you wont contract misanthropy and disphoria and terminal surliness in your new position. Even nice people can be pushed too far. (I heard about a contractor at McMurdo Antarctic base that is run by the Rayethon corporation to the despair of everyone there - and this man one day armed himself with a hammer and innocent smile and went to cafeteria to settle the score with his boss. The boss was fine but most annoyed were his colleagues who then had to drop everything and build a jail to detain the perp, until the FBI agents flew in and took the man back to US.)

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29. Anonymous on April 8, 2010 7:17 AM writes...

#20 Chemjobber - it's easy to get work at community colleges teaching one course for a few grand, but hard to get a full-time permanent job with benefits. The only way it makes sense is if you've got a spouse with a good salary and healthcare plan.

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30. medcchemstudent on April 8, 2010 8:11 AM writes...

Well. It seems it should be an easy decision between getting an MD or staying with med chem. Trying to get a job as a graduate (pharmacy/medchem) having no experience from industry, is that just a waste of time?

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31. bbooooooya on April 8, 2010 8:48 AM writes...

"Chemistry is now a no-win scenario. You will not make it from the end of your university education (at whatever level) through to retirement, even with multiple employers."

Not true. Chemistry is going the way of professions like law or accounting, that is, up or out. Lawyers or accountants either make the jump to partner after 10 or so years, or wash out to a second rate postion. Chemists either make the jump to management or, well, I'm not really sure. I don't recall ever seeing too many of the >40 set working in the lab, either at biotechs of pharma. Where do these people go?

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32. Pharma Conduct Guy on April 8, 2010 5:04 PM writes...

#22 Keith said "…capable of generating or increasing current revenue and profit. The real problem is that corporate executives are not paid for long term thinking, but for quarterly 'improvements' in profits, whether or not the profits are real"

Your comment is very true. Sadly, it's true for virtually every publicly traded company, large or small, and even most venture backed companies, since they are never started with the intention of making something useful, unless you count ROI for the original investors. "Exit strategy" should be thought of as "let's see how much we can swindle the next round of investors."

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33. AlchemX on April 8, 2010 11:15 PM writes...

Gotta agree with bbooooooya #31 on that. There are guys in chemistry after their 30's making damn good living. But for every one of those guys there are a lot who will never be employed in this field again. If you think you're in the top 5-10% and your family can handle this volatility (or you don't have a family), you have nothing to worry about. All the rest, start making plans.

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34. Hap on April 9, 2010 5:15 PM writes...

That model works for lawyers, finance people, and pro athletes, where the benefits of success for that top 1-5% are huge enough to generate the piles of people (ore) needed to find that small chunk of valuable metal. Since nothing in chemistry pays that much or has the social credit needed to be popular, and the input in time to be a chemist is significantly larger than those fields, I'm not certain how there are going to be enough chemists to sustain that model.

In the short-term, you'll get lots of eager Chinese and Indian people, and the cream of what's left in the US and Europe and Japan, but in the long run, there won't be enough money to keep Chinese and Indian people flooding into the meat grinder (or enough money from developed markets to sustain the meat grinder in the first place). Furthermore, at some point, the cheap labor'll decide that it can't possibly be less competent than its management (and will almost certainly be correct), and will overthrow its management from within or without.

Recycling your 1994 Dodge Spirit in the hope that it will magically be converted to a 2010 Acura and left with its keys in your driveway is probably not a winning business strategy.

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35. Nick K on April 10, 2010 11:21 AM writes...

I share the scepticism of several previous posters with these figures. Some companies are quietly terminating a few employees at a time to avoid unfavourable publicity. Another point is the constant debasement of the quality of employment - at Pfizer Sandwich dozens chemists have been "out-sourced" to Peakdale. They haven't actually lost their jobs, only seen their salaries and benefits halved.

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