Around 120 AstraZeneca employees in Wilmington are out of work as the company eliminates 700 sales and non-sales positions, including 80 vacancies, nationwide due to financial hardships.
On Thursday, the international biopharmaceutical company said layoffs were part of its “return to growth strategy” to streamline and drive greater efficiency, which they say is necessary due to lower U.S. revenues in 2017.
“We continue to face loss of exclusivity impacts from many of our legacy products and work to compete in an ever-changing external environment,” the company said in a statement. “By diligently prioritizing, we will continue to successfully launch and commercialize new medicines, meet the needs of our customers and patients, and ultimately help AstraZeneca return to growth.”
Following the layoffs, which are only for U.S. commercial business, AstraZeneca will have about 1,500 employees working in Delaware, according to a company spokesperson.
“While these decisions are in the best interest of our future, this is a difficult time for our entire U.S. organization, particularly for the people who are directly impacted,” the company said in a statement. “AstraZeneca is committed to treating every employee with dignity and respect throughout this process. Employees who are impacted will be provided with internal and external assistance and support.”
Bob Dayton, president of the Delaware BioScience Association, said he was surprised by the announcement, but that it follows a trend in the industry.
“The industry has been going through changes for at least the last two decades, and these kinds of layoffs have been seen frequently in big pharmaceutical companies,” he said. “So there’s no doubt it will have an impact here in Delaware, and we’re thinking of the families who will be impacted by the downsizing.”
Richard Heffron, the president of the Delaware Chamber of Commerce, said the state should concentrate on companies that are expanding and hiring.
“It’s always disappointing when you see jobs cut employees. But they discussed it before, the world’s changing and you have to react to it. The positive thing is JP Morgan is expanding and hiring more people, and that’s what you need to focus on,” he said.
“You have a new mayor, a new county executive and new governor. I think they’re all focused on attracting jobs to Delaware and expansions. There are opportunities out there, like looking at abandoned properties and seeing if we can attract companies to those. Mike Purzycki, Matt Meyer and John Carney are focused on growing the economy, and we’ll be there to help them to do that. We’ve done it before, we’ll do it again, we’ll adjust to the economy.”
Congressman and Governor-elect John Carney, D-Delaware, released a statement following the announcement.
“Today’s announcement is devastating news for the 120 Delawareans and their families who will be impacted,” he said. “I am committed to doing whatever I can to make the transition to the next phase in their careers as quick and easy as possible. My thoughts are with them, particularly during this holiday season.”
U.S. Sen. Tom Carper, D-Delaware, said the layoffs are “deeply disappointing” as the company provided well-paying jobs to Delawareans and boosted the local economy.
“While I am heartened by AstraZeneca’s commitment to keep its North American headquarters in Delaware and that Delaware will be spared the majority of these layoffs, too many of our neighbors and their families will bear the brunt of this news,” he said in a statement.
“It is our duty now to ensure these Delawareans land on their feet and find great opportunity in the face of this adversity… While this is a tough time for the company, I am hopeful it will gain solid footing and be able to grow and thrive with the new drugs in its pipeline.”
Heffron said it’s difficult to predict what direction the pharmaceutical industry is heading.
“It’s all product based. If they have product in the pipeline they expand, and if they don’t, they have to make hard decisions and cut back,” he said. “The good thing is they’re keeping their packaging plant open and they’re important jobs.”
Dayton said while the industry faces several challenges, it is important they survive nationwide.
“We know there are lots of diseases that need to be cured. The challenges the industry faces today are pressures to reduce drug prices, and that has a negative impact on the industry,” he said.
“But I think overall, this industry is good for the economy here in Delaware, here in the U.S., it offers great job opportunities and the output from the industry is tremendous—the industry itself is trying to improve lives, make people healthier, extend life and improve quality of life.”
Dayton said his association has helped laid-off employees from AstraZeneca and similar companies in the past, and expects to do the same for the recently affected employees. The association will have a career fair next year, and it regularly hosts a Bio Breakfast to provide networking opportunities.
Dayton said a smaller pharmaceutical company, called Incyte, also is expanding in Wilmington.
“We expect we’ll be able to help a number of the AstraZeneca employees meet with and find positions with companies here in Delaware and in the region,” he said.
“Perhaps initially it will have a negative impact in the state of Delaware, but hopefully in the long term these people with these skill sets will find new opportunities in the growth companies here, and we’ll see a positive impact in the long term.”