Lilly shifting work to outsiders

Local drug maker will be cutting jobs through attrition and changing to a 'network structure'
December 7, 2007

Five years from now, Eli Lilly and Co. could look like a different company, with fewer employees and plants, as it shifts more of its scientific research, manufacturing, sales and administrative work from Indianapolis to outsiders around the world.


NEXT OUT OF THE PIPELINE
Here's a look at some Lilly drugs under late-stage development:

Prasugrel
• What it treats: Acute coronary conditions.
• Status: Lilly recently wrapped up a large Phase III study and plans to apply for FDA approval this month.

Byetta once-weekly version
• What it treats: Diabetes.
• Status: Lilly plans to apply for FDA approval in the first half of 2009.

AIR inhaled insulin
• What it treats: Diabetes.
• Status: Lilly plans to apply for FDA approval in 2009.

Arzoxifene
• What it treats: Osteoporosis.
• Status: Lilly plans to apply for FDA approval in 2009.

OTHER JOB CUTS
Since January 2006, other drug makers have announced plans to cut thousands of jobs, including:
• Abbott Laboratories 1,200 jobs
• Bristol-Myers Squibb 4,300 jobs
• Pfizer 10,000 jobs
• Merck 7,000 jobs
• AstraZeneca 7,600 jobs
• Schering-Plough 1,100 jobs
• Johnson & Johnson 4,800 jobs
• Bayer 6,100 jobs
• Amgen 2,600 jobs
• Novartis 1,260 jobs

Source: Star research

Facing pressures that have rattled the pharmaceutical industry, the drug maker told analysts Thursday it is transforming aggressively from a fully integrated pharmaceutical company into a "network structure" of outside contractors, service providers and others to further cut costs and improve productivity.
How deeply the move affects Central Indiana, where Lilly's 12,000 workers make it the region's largest private employer, depends largely on how much work the company outsources to Hoosier contractors.
Lilly said it is not planning any sweeping layoffs or plant closings, unlike many of its competitors. The company said most of the cuts will occur by not filling open positions, continuing a downsizing strategy it has used for several years. Lilly did not give a target number of positions to be cut.

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