AbbVie’s Allergan Aesthetics Unit to Lay Off 202 Employees Amid Sales Decline
In a notable shift within the pharmaceutical sector, AbbVie has announced plans to lay off 202 employees from its Allergan Aesthetics unit as part of a reorganization strategy aimed at bolstering its presence within the competitive aesthetics market. This decision, confirmed in a recent California Worker Adjustment and Retraining Notification (WARN) Act notice, comes amidst a troubling sales performance for key products such as Botox and Juvederm.
Sales Slump in Aesthetic Products
AbbVie’s Allergan unit has been experiencing a downward trend in revenue, registering a 2.2% decrease in sales last year, dropping to $5.17 billion. The troubling trajectory has continued into 2025, with first-quarter sales plummeting by 11.7% to $1.1 billion, as reported by The Orange County Business Journal. The slump in sales reflects a broader issue within AbbVie’s aesthetics portfolio, particularly affecting its heralded products, Botox and Juvederm, which have seen double-digit declines in their latest earnings reports.
Reasons Behind the Layoffs
The layoffs, set to take effect in July, will see 19 employees from the company’s Irvine, California headquarters let go, with the majority of cuts affecting remote positions. A spokesperson clarified that these actions are part of a strategic move to “better position Allergan Aesthetics for sustained leadership within the dynamic aesthetics industry.” It is worth noting that this is not the first instance of workforce reductions; in 2022, the company laid off 99 workers at the same site.
Management attributed the recent sales decline to challenges faced with a newly implemented aesthetics loyalty program, which they deemed “too complex” for providers. In response, Allergan plans to revert to its original loyalty program, as stated by Allergan’s global president, Carrie Strom, in a February earnings call.
Future Outlook for AbbVie’s Aesthetics Division
Despite the current challenges, AbbVie maintains an optimistic outlook for its aesthetics franchise. The company projects a “high single-digit compound annual revenue growth rate” through 2029. This goal hinges significantly on the continuing popularity of their established offerings, as well as the introduction of new products. For instance, Allergan’s recent launch of Skinvive, a dermal filler approved in 2023, showcases the company’s commitment to innovation, even as it works through existing sales challenges.
Positive Trends in Immunology
While Allergan faces headwinds, AbbVie remains resilient in other areas, particularly within its immunology segment. The company’s successors to the blockbuster drug Humira, named Skyrizi and Rinvoq, are performing strongly with impressive launches, contributing $6.26 billion in sales during the first quarter. The success of these drugs is critical for AbbVie, especially as the looming threat of biosimilars continues to encroach upon Humira’s market share.
Industry-Wide Workforce Reductions
The instability in AbbVie’s Allergan unit’s workforce isn’t unique; it’s reflective of a broader trend within the pharmaceutical industry. Companies such as Bristol Myers Squibb and Teva Pharmaceuticals are also undergoing substantial layoffs—Bristol Myers Squibb recently announced plans to cut 516 jobs, while Teva is looking to reduce its workforce by 8% through 2027 as part of cost-reduction strategies. This pattern underscores the challenges currently confronting major pharma firms, often spurred by the need for strategic adjustments amid shifting market dynamics.
Conclusion
AbbVie’s decision to cut 202 positions within its Allergan Aesthetics unit represents a significant moment for the company, highlighting the ongoing challenges within the aesthetic drug market. While the immediate outlook appears complex due to declining sales, the firm’s emphasis on innovation and the strong performance of its immunology products could provide a pathway for recovery and future growth. For investors and industry observers, monitoring these developments will be crucial in assessing AbbVie’s long-term strategic positioning and overall market stability.
