Pfizer-AZ merger prospects: Where will the job cuts come from?
Pfizer CEO Ian Read admitted before Parliament’s Innovation and Skills Committee Tuesday that should the companies merge, he doesn’t expect the combined total of employees to be the same as it is now, noting, “I expect it to be lower, how much lower, I don’t know.”
“I’m not sitting here saying we can become more efficient without some reduction in jobs,” Read said later, adding, “What I cannot tell you is how much, how many or where…There will be jobs cut somewhere.”
Pfizer reiterated its pledge before the committee to keep 20% of its global R&D workforce in the UK, following reassurances in a letter to the UK prime minister that the company would keep a “substantial” level of manufacturing in UK, though members the committee seemed exceedingly sceptical of Pfizer’s assurances and commitments.
In the hearing, committee members expressed concerns over what “substantial” means, as well as loopholes in Pfizer’s initial letter calling for support to the merger.
Alan Black -- national officer at GMB, a workers’ union -- noted that Pfizer’s commitment of 10 years to continue operating R&D in the UK could be considerably shorter than what AstraZeneca would maintain in Britain if it remains a stand-alone company.
AstraZeneca previously rejected a £63bn ($106bn) takeover bid.
Pfizer also doesn’t exactly have a good track record with keeping jobs in the UK. The company closed its R&D centre in the UK in 2011, which resulted in the loss of about 2,400 jobs.
Read also said that without a formal offer, as Pfizer has only proposed to acquire AstraZeneca, he cannot make any specific comment son where the cuts will come from.
Jobs Elsewhere
Questions around job cuts are also being raised elsewhere as it becomes obvious that some will take a loss.
Sweden, which contains AstraZeneca’s research site of Moelndal, said it hasn’t received any commitments from Pfizer on keeping jobs there, according to Bloomberg News.
US governors Martin O’Malley and Jack Markell also wrote Read last week asking what assurances he could give them for the 5,700 AstraZeneca workers in their states, but Read said it’s too soon to indicate what kind of impact they might see.
