Mama Mia! Waving the Turin Shroud

Italy May Lose Thousands Of Drug-Firm Jobs, Industry Lobby Says

Drug companies in Italy may eliminate thousands of jobs due to government spending cuts, including those introduced this month by Prime Minister Mario Monti, according to a trade group and labor unions.

“The consequences for companies are clear: disinvestment, delocalization and a worsening of crises and restructurings,” said Antonio Messina, a delegate of Farmindustria, and Alberto Morselli, general secretary of the FILCTEM-CGIL union, in an open letter to Monti today. “Further crises will inevitably come, with employment consequences in the near future for thousands of workers.”

Monti is pushing to tame Italy’s deficit and lower the country’s borrowing costs. On July 6, his Cabinet approved 26 billion euros ($31.5 billion) of spending reductions over the next three years. Labor unions and Farmindustria, an association whose members include units of Merck & Co. (MRK) and Eli Lilly & Co. (LLY), are urging Monti to ease cutbacks on pharmaceutical spending before the package passes parliament.

“These measures pose a particular risk to producers of pharmaceuticals and medical devices,” said Wolfango Piccoli, an analyst with Eurasia Group in London, in a research note today.

To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net.

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

Http://www.bloomberg.com/news/2012-07-23/italy-may-lose-thousands-of-drug-firm-jobs-industry-lobby-says.html