It will be interesting to see on Oct. 22 when Wyeth presents its third-quarter earnings whether the company actually managed to save some money through all the layoffs it is doing. Wyeth said back at the halfway point of the year that its cuts had somehow driven its costs up:
The 2008 second quarter and first half charges included expenses of $155.2 million and $340.8 million, respectively, primarily for severance and other employee-related costs associated with a reduction in workforce ... The 2007 second quarter and first half included productivity initiatives expenses of $49.8 million and $92.4 million, respectively ...BNET readers will remember that this was in stark contrast to Abbott Labs, whose job-cut program came shining through in the form of profits, a few days ago.
It's all part of Wyeth's "Project Impact," a plan to reduce its workforce by 6 percent due to Protonix going generic. It began with 1,200 reps axed in March.
All those cuts should have boosted the bottom line a la Abbott. But then came yesterday's news that Wyeth was abandoning Pristiq in Europe, where the antidepressant is not approved. That blow suggests one thing: With Euro revenues no longer part of the Wyeth plan, more layoffs may be on the way.