The loss of patent protection on two drugs is forcing Gilead Sciences to terminate about 20 percent of its sales team, according to reports.
California-based Gilead will terminate about 150 long-term members of its sales team, STAT News reported. The two drugs, Ranexa and Letairis, lost protection this year. Ranexa’s patent expired at the end of February and generic drugmakers have lined up with their own products to treat angina. There are also other classes of drugs aimed at the same indication, including generics. Letairis, a treatment for pulmonary arterial hypertension, lost its patent protection last summer. Since then, generics, as well as newer drugs aimed at the same indication, have begun to undercut sales.
Gilead told STAT that the job cuts are unfortunate but necessary in order to cut costs. Gilead is still trying to pivot and recover from the losses it has taken in the hepatitis C arena. Gilead had previously warned its investors of the patent losses and the associated loss of revenue due to generic challenges. The layoffs will become effective July 1, according to the report.
The layoffs are a rough start to the tenure of new Gilead Chief Executive Officer Daniel O’Day, who took over the reins of the company last month. O’Day, a long-time Roche veteran, was tapped for the top spot at the company after former CEO John Milligan announced last summer that he planned to step down. O’Day was the former CEO of Roche Pharmaceuticals. One of O’Day’s primary focuses as CEO is on Gilead’s CAR-T program. Sales of Yescarta (axicabtagene ciloleucel) have been lower than the company would like, which is due to a number of reasons, including the risk of toxicity, cost and logistical issues regarding the process. Yescarta was initially developed by Kite Pharma but Gilead acquired that company in an almost $12 billion deal in 2017. In the United States, Yescarta was the second CAR-T treatment approved.
The sales team layoffs aren’t the only snags that Gilead has hit in the past several months. Prior to O’Day’s taking over, the company’s pivot to developing treatments for nonalcoholic steatohepatitis (NASH) hit a major problem. Its Phase III treatment selonsertib, developed to treat compensated cirrhosis from NASH, failed to meet primary its endpoint in the STELLAR-4 trial.
In addition to the Phase III failure, the company also lost a legal fight over one of its HIV drugs. In February, a California court ruled that personal injury cases against the company would be allowed to proceed. HIV patients and advocates have filed several lawsuits against the Foster City, Calif.-based company claiming the company “suppressed a safer, far less toxic version of the drug in order to maximize profits and extend sales of the first drug, tenofovir disoproxil fumarate (TDF).”
A Product Manager with expertise in pharma marketing and sales operations