Eisai realigns US operations, with 20% job cuts

Eisai Inc, a US subsidiary of Japan’s fourth-largest drugmaker Eisai (TYO: 4532), plans to realign its operations in the USA, as part of a restructuring which last week also saw the company announce 200 job cuts in Europe and 100 sales jobs in Japan, now that its best selling Alzheimer’s drug Aricept (donepezil) is facing generic competition, as US patent protection will laps in November.

Under this restructuring, Eisai will reduce its workforce by around 20% across all US functions, eliminating about 600 positions in total by April 1, 2011. This organizational restructuring supports Eisai’s global mid-term strategic plan for the fiscal years 2011-2015 period, which seeks to transform Eisai’s business into a more efficient and focused organization to better serve its human health care mission.

Generic versions of Aricept have led to a 70% discount in the value of the medicine, said Surajit Pal, a health care analyst at Elara Securities India quoted by Bloomberg. The drug generated 322.8 billion yen ($3.9 billion) in revenue, or about 40% of Eisai’s sales, in the year ended March 31, 2010.