Sumitomo’s US arm trims more jobs amid restructuring blitz
05 Mar 2024
Phase 3NDAFinancial StatementBiosimilar
After axing around 500 positions at its US unit in July last year, Sumitomo Pharma announced another round of layoffs – this time slashing approximately 400 jobs, primarily in sales and marketing, as it intensifies efforts to restructure the subsidiary.
The company cited the “current severe business environment” and the failure to achieve projected sales targets for three of its key products - Orgovyx (relugolix), Myfembree (relugolix/estradiol/norethisterone acetate), and Gemtesa (vibegron). Sumitomo recently revised down estimates for the drugs, with North American sales of Orgovyx in the current fiscal year seen reaching $290 million, down from an earlier prediction of $396 million.
Meanwhile, annual revenue from Gemtesa in North America is now seen at $260 million, cut from previous guidance of $362 million, with Myfembree set to bring in $70 million, slashed from a prior forecast of $192 million. Jefferies analysts called the cuts to the outlook “bigger-than-expected,” noting that it is “increasingly unlikely” that the company will meet the targets of its “ambitious-looking medium term plan.”
Sumitomo has also seen a significant revenue dip due to US patent expiry for the schizophrenia therapy Latuda (lurasidone). Sales of the product in North American plunged 97% in the third quarter of the current fiscal year to $5 million.
Assets that the drugmaker hoped would replace lost revenue from Latuda have also stumbled in development. Last year, a pair of Phase III studies investigating the Otsuka-partnered schizophrenia candidate ulotaront failed to meet their primary endpoints. Sumitomo said recently that the development strategy for the drug in this indication continues to be discussed with OtsukaOtsuka.
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