Washington, DCTakeda Pharmaceutical Co., Asia's biggest drugmaker, plans to eliminate roughly nine percent of its workforce over the next four years partly as a result of Actos side effects, according to Bloomberg.
The news source reported that the company is looking to recover from an 11-year-low profit that was recorded last year. Takeda will cut 2,800 jobs, mainly in the US and Europe, to help yield net savings of roughly $1.7 billion yen by the year ending March 31, 2016. The drugmaker said that costs associated with the plan will trim a fraction of the number from net income in the current financial year.
According to Bloomberg, European units may be merged or sold as part of the integration of Nycomed, a company purchased by Takeda for $12 billion in September. The Swiss firm may help to buffer the drugmaker from a slump of sales in Actos, the best-selling diabetes drug that has been linked with significant side effects.
"I'm not fully convinced by the restructuring plan," Fumiyoshi Sakai, a health care analyst at Credit Suisse Group AG in Tokyo, told the news source. "I'm not sure that it's enough." He has a "neutral" rating on Takeda shares and expects them to fall over the next 12 months.
The earnings outlook for the next fiscal year is uncertain due to the drop in sales of Actos, as the threat of copycat medicines is also a problem that persists with the drug. Sakai and colleague Toshiyuki Tateno noted that the immediate future remains uncertain for the company.
"The rationalization measures are likely to produce quick results, but the impact on net profit is uncertain," the two analysts told the news source. The announcement by the company may "spark a brief rally, but it remains to be seen whether the announced measures alone will be enough to turn around performance."
The St. Louis American reported that a movement against the drug has occurred in St. Louis, Missouri, as many residents are looking to take legal action.
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