Collective big layoffs, what happened to Japanese pharmaceutical companies?

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According to the report, in February 2019, Japan's large pharmaceutical companies, Concord Yulin Co., Ltd. and Toriya Pharmaceutical Co., Ltd. announced that they would recruit employees who had voluntarily resigned.

Concord Fermentation Kirin Co., Ltd., with 4,000 employees, hopes that 1,600 employees will leave the company, accounting for about 40% of the total number of employees. The registration time determined by the club is from March 11 to 28, 2019. The number of applicants is not limited, which means that the more people register, the better.

Torii medicines require all employees outside the manufacturing and logistics departments to sign up and leave the registration period from April 15 to May 31, 2019. Although Torii medicine does not clearly state the number of employees who wish to leave, there is a “de facto separation”.

It is reported that Torii medicine has a total of 1024 full-time employees, including informal employees, and the total number of employees is about 1,200. At a press conference held on February 6, the company issued a new medium-term business plan, which clearly stated that “the premise of controlling employees within 800 people is a prerequisite”. In other words, Torii will have 400 employees who will lose their jobs.

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In fact, the so-called "voluntary registration and resignation" is just a euphemism for Japanese-style layoffs. However, one of the three people must leave, and such a large number of layoffs still shocked the Japanese society. What happened to the Japanese pharmaceutical industry?

According to the report, because US pharmaceutical companies have obtained exclusive sales rights for anti-AIDS drugs in Japan, the overall sales of Tosu Pharmaceutical Co., Ltd. will evaporate by one-third, and the revenue for 2019 is expected to be 4.9 billion yen from the previous period. A surplus of 293 million yuan) became a deficit of 3.2 billion yen (about 191 million yuan). Because it takes more than 10 years for the development of new drugs to go public, in order to turn losses into profits, Torii Co., Ltd. must reduce costs through large-scale layoffs and tide over the difficulties.

What is puzzling is that in addition to the pharmaceutical companies facing losses, Dazheng, Eisai and other profitable Japanese pharmaceutical companies have also chosen layoffs, and the scale is hundreds or even thousands. At the same time of layoffs, these pharmaceutical companies are also rapidly promoting the introduction of new talents, which is actually a “change of blood”.

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According to seniors in the Japanese pharmaceutical industry, Japanese pharmaceutical companies are accelerating to adapt to the challenges brought about by globalization and informationization. Some pharmaceutical companies are preparing to increase the proportion of overseas sales to more than 50%, which requires more international talents. Existing employees, especially old employees, have long been accustomed to the rhythm and system of the Japanese market, and are unlikely to play a big role in internationalization. Therefore, most of the layoffs of Japanese pharmaceutical companies are the elimination of older employees.

In addition, in the era of informationization and digitization, Japanese pharmaceutical companies are also in urgent need of recruiting expert talents who are good at big data. In other words, instead of saying that Japanese pharmaceutical companies are cutting employees, it is better to say that they are changing their cages and changing their talents. This is the fundamental reason why Japanese pharmaceutical companies with stable performance are also determined to lay off employees.

According to a survey conducted by the US research institute IQVIA, the Japanese pharmaceutical market has decreased by 1.7% year-on-year in 2018, and has been reduced for two consecutive years. By 2023, Japan will become the only country in the developed world with negative growth in pharmaceutical sales. If Japanese pharmaceutical companies continue to maintain the current rhythm, they will face a serious crisis in the future and are likely to become abandoned children in the world market. Therefore, it is a wise choice for Japanese pharmaceutical companies to adjust the personnel structure through substantial layoffs and meet the challenge with a more positive attitude.