Biotech is booming—but is big pharma waning?
- Between 2007 and 2013, biotech employment grew by more than 5%, from 135,424 to 142,475, according to a report in the Philadelphia Inquirer flagged by FiercePharma that uses Department of Labor data.
- But the same article reports that between 2003 and 2013, big pharma reduced workforces by roughly by more than 5%, from 291,795 to 277,113.
- Many of the job losses in big pharma are attributed to the impact of numerous patent expirations, as well as the impact of heavy-duty mega-merger activity.
As BioPharma Dive has previously reported, there are several major trends driving job losses in pharma, including industry condolidation, changes in R&D structures, and the evolution of the pharma marketing sales force.
As biotech booms, pharma is trying to keep the status quo in terms of decreasing the rate of job losses. The good news here is that annual job losses are now in the thousands versus the tens of thousands of job losses per year that were common several years ago.
Chris Molineaux, president of the Pennsylvania chapter of the massive trade group BIO, told the Philadelphia Inquirer that the job losses are not only due to the consolidation of the industry through M&A activity, but also through a large outsourcing trend in which everything from sales, to marketing, to R&D are outsourced to contracting agencies.
In addition, meager pipelines have not helped bolster earnings growth, which puts further pressure on hiring and being able to retain employees. The result is that large companies, such as Eli Lilly and Bristol-Myers Squibb are no longer in the top top echelons of the biggest healthcare companies anymore. They have been replaced by biotechs, and the trend is continuing.