Pfizer To Lay Off 10,000, Close Two Manufacturing Sites

Cost savings of $1.5-$1.8 billion by end of 2008.

Pfizer announced Jan. 22 that it is cutting 10% of its workforce, and closing two manufacturing plants to reduce costs. Plants in Brooklyn, N.Y. and Omaha, Neb. will be closed while 10,000 employees worldwide will lose their jobs. The company will also close three research sites in the U.S. -- Ann Arbor, Mich., Esperion (also in Ann Arbor) and Kalamazoo, Mich. (where the company will continue to maintain a large manufacturing and Animal Health presence) -- and is proposing to close research sites in Nagoya, Japan and Amboise, France.

From 2003 to 2008, Pfizer will have reduced its network of manufacturing plants around the world from 93 to 48, including sites announced today said a company statement.

"We must reduce our absolute costs and put in place a more flexible cost structure. We are establishing smaller operating units that can enhance innovation and accountability while still drawing on the advantages that our scale and resources provide," said CEO Jeffrey B. Kindler.

In an effort to "cut down on bureaucracy and reduce management layers," the company has eliminated committees and cross-functional teams and is in the process of cutting at least three to four layers of management in its pharmaceutical, R&D and manufacturing divisions, as well as company-wide support functions, according a company statement.

Pfizer will continue to focus on products such as Lipitor and Celebrex while putting some marketing dollars behinds newer medicines. Investments include more research and development in biotherapeutics where it will focus on vaccines and antibodies, according to a company statement." Pfizer plans to launch two new externally sourced products each year beginning in 2010," said David Shedlarz, vice chairman.

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