Happy Easter! Sanofi Again Lays Off Staffers Over a Holiday

Sanofi-Aventis (SNY) continued its tradition of using holidays to deliver layoffs by telling its employees as they returned from the Easter weekend that 400 of them no longer had jobs. The news was delivered in an email to staff this morning from Jerry Durso (below), vp/U.S. specialized therapeutics (see full text after the jump).

The company previously laid off a large number of contract pharmaceutical sales reps over Christmas and New Year, who followed 750 of Sanofi's own employees out the door last Thanksgiving. Sanofi did the same thing in front of the July 4 weekend last year and at Thanksgiving in 2008.

The layoffs are a reaction to declining sales or generic threats on three brands: sleeping pill Ambien CR, osteoporosis drug Actonel and the antidepressant Aplenzin. None of the moves were a surprise, at least to Sanofi's staff.

Sales reps had complained on CafePharma -- the gossipy bulletin board of the drug industry -- that when they picked up prescriptions for Ambien recently their pharmacists asked if they would be interested in switching to a cheaper generic. Sales of Ambien were up 6.2 percent to $873 million in 2009, but the company's annual report included a note saying that it expected cheap generic challenges to the drug following March 2010.

Aplenzi has such low sales it is not mentioned anywhere in the report, and Sanofi's own reps had such a low opinion of the product that they've been ignoring it anyway.

Actonel was more of a surprise. The company did not mention any generic threats to the drug, which has exclusive patent protection through 2013 in the U.S. and further extensions through 2018. Actonel had won all its patent litigation recently and had a once-a-month formula to offer. It did, however, see a 20 percent loss of sales last year to $264 million. Sanofi will now cease all marketing of the drug. Sanofi's partner on the drug, Warner Chilcott, elaborated in a press release here.)

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Sent: Monday, April 05, 2010 Subject: A Message from Jerry Durso: General Therapeutics Portfolio Update

Dear Colleagues,

As you know, the company has established a strategy for the future centered on key therapeutic areas including diabetes, oncology, atrial fibrillation and other platforms for sustainable growth. As we focus our efforts in these areas and we look at adapting our structures to future challenges, we are constantly evaluating the resources we have dedicated to our full portfolio, including those within general therapeutics.

For many brands we need to continue to drive strong results. But we are also reaching the end of the promotional lifecycle for some of our general therapeutics products, along with facing difficult market conditions with the entrance of generics into the classes in which we compete. In light of these challenges, we have made a series of decisions that will deploy resources to better support our growth strategy.

First, we have decided to restructure our agreement with Warner Chilcott regarding promotion of Actonel in the United States. Effective today, sanofi-aventis will cease sales, marketing, local R&D decisions and distribution of Actonel in the U.S. and Puerto Rico. [Click here to link to our press release]. Some of the sales professionals who have recently promoted Actonel will be offered an opportunity to interview with Warner Chilcott for potential employment with their sales force.

Next, we decided to reduce promotional efforts on two late-stage products, Ambien CR and Nasacort AQ. We will reduce the number of sales professionals promoting these products in order to focus our resources on areas of greatest long-term potential return.

The final result of this evaluation is the decision to outsource Aplenzin promotional activities to a contract organization. This is a strategic response to our reduced presence in the CNS market, including Ambien CR. Last year, sanofi-aventis withdrew the eplivanserin submission dossier in insomnia because of the need for significant further clinical developments and market access constraints. Based on this decision and our overall CNS presence, we have decided to reduce our internal resources dedicated to support Aplenzin.

Even as we decide where to reduce our promotional efforts, we are increasing our presence in the metabolism arena, one of our identified platforms for sustainable growth and area of increasing customer need. Effective May 1, some sales professionals previously promoting products in the general therapeutics portfolio will move into U.S. Diabetes to help drive our Lantus business.

As a result of these collective decisions, about 400 colleagues across the organization will have been notified over the coming days that they will be displaced from sanofi-aventis U.S. It is never easy to make decisions that will impact the lives of our colleagues. We value the contributions that they have made, particularly recent efforts to maximize our product opportunities under very challenging circumstances. Those who will be leaving the organization will be treated with compassion and will be supported throughout the transition.

I thank all of you for your patience and flexibility during these times of change, and for continuing to focus on our common business priorities. I am committed to providing as much information as possible to the commercial organization, and have asked the Commercial Leadership Team to be available to answer questions and address concerns. For those functions that are directly affected, your leaders will be in contact with you this week. Thank you again for all of your contributions.

Best Regards,

Jerry Durso

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