Aug. 2 (Bloomberg) -- Europe’s financial crisis is leading Johnson & Johnson, Sanofi-Aventis SA and Merck & Co. to lower forecasts and reduce spending, adding pressure on drugmakers already squeezed by generic competition.
Germany, Greece and Spain have cut or plan to reduce their health spending after European Union policy makers agreed to an almost $1 trillion rescue fund in May to prevent the fiscal collapse in Greece from spreading. Germany implemented a price freeze on drugs through 2013, while Spain introduced a 7.5 percent rebate on most branded products. Greece ordered drugmakers in May to cut prices by as much as 27 percent.
Now, pushed by the European price cuts, the Paris-based company is seeking to further reduce expenses, said Jerome Contamine, Sanofi-Aventis’s chief financial officer, in June. In the first half of 2010, the company shrank its sales force in the U.S. by 1,400, and in western Europe by 400, compared with the first half of 2009.
At the same time, it increased its sales force in emerging- market countries by 600.
“We are changing our marketing model,” Contamine said at a Goldman Sachs Group Inc. conference in Los Angeles in June. “We are merging sales forces, we are reducing sales forces, having a multiproduct sales force. We will continue to do that.”
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