In February 2006, Procter & Gamble (P&G) announced a significant restructuring of its pharmaceutical division, resulting in the elimination of 300 jobs. The cuts, impacting researchers, scientists, and technical staff, primarily affected the company’s research center in Mason, Ohio, home to 2,560 employees and the headquarters of P&G’s core businesses. Some positions in London, Toronto, and New York were also impacted.
According to P&G spokesperson Tom Millikin, these job cuts were not a cost-saving measure, but a strategic realignment. P&G planned to shift its focus away from early-stage pharmaceutical research, instead concentrating on acquiring and licensing promising medicines from other companies. This strategy aimed to leverage the innovation of the 4,400 biotechnology companies worldwide that possess valuable chemical compounds but lack the resources for commercialization.
This shift meant P&G would prioritize developing drugs in specific areas, including women’s health, musculoskeletal treatments, and gastrointestinal medicine. The company had recently partnered with Nastech to expand and market Nastech’s nasal spray for osteoporosis.
The job losses raised concerns about the impact on Cincinnati’s reputation as a life sciences research hub, especially given P&G’s status as the city’s largest employer. The broader P&G community comprises 98,000 employees across 80 countries, manufacturing a diverse range of consumer products from diapers to detergents.
Reports from the previous year indicated P&G’s plans for a major reorganization, leading to layoffs and potential plant closures. News of the restructuring positively impacted the company’s stock, which rose 3 1/8 points following a New York Times article detailing the plans.