John La Mattina worked at Pfizer for thirty years, eventually becoming their head of R&D in 2004. He held that position for four years and then started cashing in, the way most senior executives do when they run out the string in the C-suite. In La Mattina's case this has included becoming a partner in a venture capital firm, a board member at small pharmas and a columnist for Forbes, the self-described "capitalist tool." If Malcolm and Steve Forbes truly considered their publication a tool instead of a propaganda sheet before selling it to an Asian investment group, then La Mattina would be their thumb screw.
Last week one of his columns pooh-poohed the steady drumbeat of layoffs and site closures in pharma during the past four or five years. After acknowledging that job losses cause major stress to the affected families and often disrupt the industry's development of new medications, La Mattina struck an optimistic tone in the manner of Dr. Pangloss. Despite the grief for families and the delays to medical research, La Mattina feels the layoffs and closings, on balance, aren't so bad. Considering the bigger picture, he believes they just represent a reallocation of people and resources from big pharmas to a changing group of smaller ones.
Of course, the layoffs and other sorrows of capitalism don't seem so bad if one can leave a $200 billion pharma company after pissing away $1 billion on a failed HDL cholesterol enhancer and still get a $22.6 million exit package. In that case it's understandable how someone can argue that in the long run, capitalism effectively sorts things out. The rest of us might agree with the rejoinder by economist J. M. Keynes, that everyone who gets screwed now will be dead in the long run.
So perhaps Dr. La Mattina can understand why the average John or Jane doesn't look at the situation with the same composure when her lab closes and she has to pull the kids out of school to move across the country.
Until the past few years, biomedical research scientists faced a major choice in deciding whether to work for a big or a small pharmaceutical company. The big company offered abundant resources and, quite as importantly, a good degree of employment stability.
Small pharmas were always pinched for resources but job security was never in the cards. If a compound fails in development and a researcher's team gets the axe, a small company is unlikely to have other programs where someone possesses the specialized qualifications needed to apply. On the other hand, success at a small company is often a job killer too because a big company is likely to buy the operation and eliminate many employees.
The incentive for going to small pharmas instead of big ones was the opportunity for researchers to acquire an equity position or otherwise participate financially in a co-development deal or sale. Many scientists in those cases earned good pay days if their projects succeeded and a big pharma swooped in.
Such payouts were never in the cards at big pharmas. Now, with all the layoffs and site closings, they no longer offer the stability either.
Let us know if pharma researchers in Collegeville, Conshohocken, Malvern, or Wilmington see it differently.