AstraZeneca axes another 7,300 jobs

Pharmaceuticals giant AstraZeneca said today that it will axe 7,300 jobs by the end of 2014 as part of a fresh round of cost savings.

The company, which has 61,000 staff globally, axed 12,600 positions between 2007 and 2009 and removed another 9,000 roles by the end of last year.

The company said the latest restructuring was needed because of the weak economy and the impact of competition from generic drugs.

The company has not yet disclosed where the jobs will go.

The jobs blow came as the company announced a 2% fall in revenues to $33.3bn in 2011, while profits fell 4% to $13.2bn.

It said generic competition as patents expire and intervention in pricing from central governments wiped $3bn from its revenues.

The company said revenues for 2012 are likely to be down by more than 10% while its margins will also be squeezed, leading to lower profits.

The Anglo-Swedish company has suffered a number of setbacks in its efforts to secure approval for new blockbuster drugs.

It recently warned that profits would be at the low end of analysts’ expectations after ovarian cancer drug olaparib was held back for further development when tests proved it was unlikely to prove effective.

The results of tests on drugs for patients with major depressive disorders were disappointing, although tests are ongoing, and the US Food and Drug Administration recently declined approval of a new diabetes drug dapagliflozin.

Analysts have also been underwhelmed by sales of its new blood thinning drug Brilinta.

Astra warned that the coming years would be “challenging for the industry and for the company”.

Chief executive David Brennan said: “Disciplined execution of our strategy has delivered a good performance in 2011 in the face of intensified pricing pressure and generic competition.

“While the further expected losses of market exclusivity make for a challenging 2012 outlook, we remain committed to a long-term, focused, research and development based strategy, and today we have announced further steps to drive productivity in all areas to improve returns on our investment in innovation.”

Despite the cost-cutting measures announced today, the UK-based company announced a 10% hike in its dividend and plans to return an additional $4.5bn to shareholders in 2012 on top of the $9.4bn last year.