By Val Brickates Kennedy Drug stocks were split in early trading Tuesday as shares of Johnson & Johnson moved slightly lower following news that it plans to lay off up to 7% of its global workforce to save money. The NYSE Arca Pharmaceutical Index (DRG) slid 0.9% to 284.66 while the NYSE Arca Biotechnology Index (BTK) climbed 0.7% to 851.07. J&J (JNJ) shares were down 0.4% at $59.27. The company said early Tuesday that it plans to cut up to 7% of its roughly 117,000-person workforce, or about 8,200 jobs, in an effort to save between $1.4 billion and $1.7 billion a year in costs. The world's largest health-care products company plans to use the savings to invest in new growth markets, product launches and "provide flexibility to adjust to the changed and evolving global environment." The company said the restructuring will be focused on reducing the layers of management and simplifying business structures. As a result of the move, J&J plans to take a pre-tax restructuring charge of $1.1 billion to $1.3 billion for the fourth quarter. It confirmed its adjusted 2009 financial forecast of earnings per share of between $4.54 and $4.59. J&J's announcement comes just a little over two weeks after it released lackluster third-quarter earnings. Shares of Israel-based Teva Pharmaceutical Industries (TEVA) were down almost 2% at $50.18. The generic drugmaker reported third-quarter adjusted earnings per share of 89 cents, on sales of $3.55 billion. A survey of analysts by FactSet Research produced consensus estimates of 88 cents a share of profit, on $3.65 billion of sales. -Val Brickates Kennedy; 415-439-6400; AskNewswires@dowjones.com
