In Lechleiter's final days, Eli Lilly flags upcoming job cuts in the wake of a PhIII implosion
Over the last 4 years Eli Lilly execs have invested hundreds of millions of dollars into its latest Phase III pivotal test for solanezumab, convinced that they were on the right track for bending the curve on Alzheimer’s. The payoff would have come in the form of what some analysts sometimes consider as the golden ticket in biotech, convertible into a multibillion-dollar annual revenue slip.
But the only color staffers may end up looking at now that it has flopped, yet again, is pink, as in pink slips. The company $LLY is being a bit coy about it, but a spokesperson told their home town newspaper is looking at layoffs in the wake of the post mortem on sola.
“The sola results will cause us to reevaluate staffing decisions made in anticipation of positive results,” Lilly spokeswoman Nicole Hebert told the Indianapolis Star in an email. “Affected employees will learn more as decisions are made.” Hebert declined to provide more specific details but said “no layoffs have been communicated.”
Eli Lilly has done some trimming in the past, but it has consistently followed the path outlined by longtime CEO John Lechleiter. While most other pharma giants were overhauling R&D, not once but several times, Lechleiter largely stuck with the pipeline he had. And by and large he also stuck with the people who were working on them as well.
Lechleiter, though, announced plans to retire soon, before the sola data arrived. A positive read out would have capped his career. But the company had also braced itself for what did occur, positioning itself with a few new drug approvals and winning some respect in R&D after going through a brutally unproductive period in drug development.
Now new CEO Dave Ricks is on his way in to the corner office in just a few weeks. And stay-the-course may be on the way out with Lechleiter.