Things are tough all over right now, even for Johnson & Johnson, the seller of such iconic health products as Band-Aids, tear-free shampoo and baby powder.
Mike Clarke/Getty Images
J&J's Baby Shampoo on display in a Hong Kong supermarket.
J&J's Baby Shampoo on display in a Hong Kong supermarket. Mike Clarke/Getty Images
Today the health-product conglomerate said it would cut 6 to 7 percent, or about 7,000, of its 117,000 employees around the world in a wide-ranging restructuring to save money and speed up decision-making.
As a result, J&J expects to save at least $800 million next year and $1.4 billion or more annually, starting in 2011. The company is making the changes so it's "well-positioned and appropriately structured for sustainable, long-term growth in the health-care industry," J&J CEO Bill Weldon said in statement.
Did health overhaul have anything to do with the move? In a conference call with investors, J&J CEO Bill Weldon said, "I don't really think we can comment on health-care reform," according to the Wall Street Journal Health Blog. "This really is not aimed at addressing health-care reform." A bigger problem is the weak economy, he said.
Separately, CFO Dominic Caruso said the company is trimming how much it spends on research and development, "particularly in the pharma business, consistent with industry trends," the WSJ Health Blog noted.
Bloomberg reminded us that this is just the latest in a series of reorgs and job cuts at drugmakers. Two years ago, J&J said it would let go about 4,800 people as generic drugs cut into profits for some of the company's best-selling prescription medicines and in the wake of a sales decline for the company's Cypher drug-coated stent.