Novartis cuts more jobs on drug setback

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Novartis cuts more jobs on drug setback

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In its latest round of job cuts, Novartis is to axe nearly 2,000 of its US workforce, mostly from the sales division.

The Swiss drugmaker is trimming costs as the patent runs out for its top-selling blood pressure drug Diovan, which means competitors can make it cheaper.

In addition it will write off the equivalent of 700 million euros after another of its key medicines failed to live up to expectations.

Novartis plans to shed 1,630 jobs in its U.S. field force and another 330 positions are expected to go as it reorganises the headquarters of its U.S. general medicines business.

The layoffs changes are expected for the second quarter of this year.

Diovan has sales of 4.7 billion euros a year. Its patent ended in Europe last year and Novartis will lose exclusivity in the United States this September. Japan follows in 2013.

The one-off charge of 700 million euros in the fourth quarter after a clinical trial showed patients taking its blood pressure pill Rasilez actually did worse, meaning sales of the treatment are likely to plunge.

Novartis’ latest round of redundancies comes only a few months after it said it was cutting 2,000 jobs in Switzerland and the United States to keep costs under control in the face of growing price pressures.