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Lilly to cut 170 manufacturing jobs by year's end

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Eli Lilly and Co. will cut 170 jobs—mostly in Indianapolis—from its manufacturing and quality division by the end of the year as it continues its efforts to slim down before losing revenue from patent expirations on its bestselling drugs.

The Indianapolis-based drugmaker’s latest move will cut nearly 5 percent of its 3,600-person manufacturing work force in the United States.

It has factories in Indianapolis and Clinton, Ind., where the cuts will take place, affecting manufacturing support workers, wrote company spokeswoman Janice Chavers in an e-mail.

To reach the 170-job target, Lilly will ask for voluntary departures, but it will also eliminate the jobs of others involuntarily. Some jobs have already been eliminated through attrition.

Chavers did not specify how many manufacturing employees would have their jobs eliminated involuntarily. But those that do will be eligible to apply for open jobs within Lilly, including some that might be vacated by those taking a voluntary buyout. All employees who depart will be offered a separation package, which is based on pay grade and time served at Lilly.

Lilly has announced nearly 2,000 job cuts toward its goal of 5,500 cuts, which the company set in September. The company is also trying to eliminate $1 billion in annual expenses by the end of 2011. At that time, it hopes to have a worldwide staff of about 35,000. It currently employs 12,400 in Indiana.

Job cuts so far have come in nearly every area of the company, including sales, marketing, communications, information technology and manufacturing.

Last year, Lilly sold off its Tippecanoe manufacturing facility to Germany-based Evonik Industries AG, which affected 700 workers. Nearly all were offered jobs with Evonik.

Lilly’s bestselling drug, the antipsychotic Zyprexa, will face competition from cheap generic copies when its U.S. and European patents expire in October 2011. In the following three years, Lilly will watch patents expire on four other bestselling drugs, threatening to steal nearly 60 percent of its $22 billion in annual revenue.

Internally, Lilly calls that time span “Years YZ.”

“All this is being done so that the organization can right-size ahead of YZ,” Chavers wrote in an e-mail. “The organization is continually evaluating how it can operate more efficiently and more productively, and adjusts operations accordingly.”
 

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  1. I took Bruce's comments to highlight a glaring issue when it comes to a state's image, and therefore its overall branding. An example is Michigan vs. Indiana. Michigan has done an excellent job of following through on its branding strategy around "Pure Michigan", even down to the detail of the rest stops. Since a state's branding is often targeted to visitors, it makes sense that rest stops, being that point of first impression, should be significant. It is clear that Indiana doesn't care as much about the impression it gives visitors even though our branding as the Crossroads of America does place importance on travel. Bruce's point is quite logical and accurate.

  2. I appreciated the article. I guess I have become so accustomed to making my "pit stops" at places where I can ALSO get gasoline and something hot to eat, that I hardly even notice public rest stops anymore. That said, I do concur with the rationale that our rest stops (if we are to have them at all) can and should be both fiscally-responsible AND designed to make a positive impression about our state.

  3. I don't know about the rest of you but I only stop at these places for one reason, and it's not to picnic. I move trucks for dealers and have been to rest areas in most all 48 lower states. Some of ours need upgrading no doubt. Many states rest areas are much worse than ours. In the rest area on I-70 just past Richmond truckers have to hike about a quarter of a mile. When I stop I;m generally in a bit of a hurry. Convenience,not beauty, is a primary concern.

  4. Community Hospital is the only system to not have layoffs? That is not true. Because I was one of the people who was laid off from East. And all of the LPN's have been laid off. Just because their layoffs were not announced or done all together does not mean people did not lose their jobs. They cherry-picked people from departments one by one. But you add them all up and it's several hundred. And East has had a dramatic drop I in patient beds from 800 to around 125. I know because I worked there for 30 years.

  5. I have obtained my 6 gallon badge for my donation of A Positive blood. I'm sorry to hear that my donation was nothing but a profit center for the Indiana Blood Center.

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