The layoffs started as rumors. Then came confirmation: Viatris Korea and Pfizer Korea were offering employees a choice—take a severance package and leave, or wait for what came next. Vantive Korea followed with its own early retirement program.

Viatris Korea offers voluntary retirements as policy pressures mount

Viatris Korea, a pharmaceutical company built on generics and off-patent drugs, is implementing a voluntary early retirement program (ERP) targeting its commercial division.

Employees with decades of experience now faced an ultimatum: take the severance package or brace for uncertainty. 

The terms, confirmed by a National Pharmaceutical and Bio Labor Union official on Friday, include two months’ pay per year of service, plus an additional eight months, with a cap of 56 months. Long-serving employees will receive additional lump sums of 30 million won ($20,784) after 15 years, 110 million won after 25. The final workday is set for March 31.

The timing is hard to ignore. In November last year, Novartis Korea slashed its workforce through an ERP package. Now, Viatris Korea is pulling back.

Behind it all looms a government policy set to take effect in late 2025—one that will systematically lower drug prices by benchmarking them against international standards. The first wave of price reductions will hit hypertension drugs. Next, cholesterol medications. Then, pain relievers. 

“Patent-expired drugs will be the most affected,” said Kang Seung-wook, secretary general of the National Pharmaceutical and Bio Labor Union. “For a company like Viatris, whose revenue depends entirely on off-patent products, this policy poses a serious financial risk. Every drug they sell is affected.”

The government argues that price controls are necessary to curb rising healthcare costs. Industry leaders warn of unintended consequences. Some multinationals are downsizing. Others, according to industry sources, are weighing whether to exit Korea entirely.

“You can’t keep slashing prices indefinitely without consequences,” Kang said. “If the government keeps forcing price cuts instead of developing sustainable cost-management strategies, why would global pharmaceutical firms continue bringing new drugs here?”

Korea may not be a top-tier pharmaceutical market, Kang said, but its drug pricing decisions have global implications. “China often considers Korea’s drug prices when adjusting its own,” he said. “If Korea lowers prices, it can trigger reductions elsewhere. The ripple effects extend beyond Korea.”

Multinational firms remain crucial to Korea’s pharmaceutical sector, particularly for first-in-class treatments. While local drugmakers have made advances in biosimilars and reformulated drugs, Kang noted that true innovation remains rare. If foreign companies decide the market is no longer viable, access to cutting-edge therapies could shrink.

“Pharmaceutical companies are businesses, and they assess market viability,” Kang said. “If Korea becomes unsustainable, some may eventually reduce their presence.”

Viatris Korea declined to address the restructuring directly when pressed for comment.

The company provided only the following statement: “Viatris Korea is committed to pursuing efficient and effective operational practices to adapt to the changing external environment and deliver greater value to healthcare professionals and patients.”

Among Viatris’ biggest sellers is Lipitor (atorvastatin), the cholesterol drug that once defined an era of blockbuster pharmaceuticals.

Despite losing patent protection years ago, it remains Korea’s leading atorvastatin monotherapy, generating nearly 189 billion won in prescription sales last year. Industry projections place it among the top three highest lifetime sales globally by 2028.

Other Viatris mainstays—Celebrex (celecoxib) for osteoarthritis, Efexor-XR (venlafaxine hydrochloride) for depression, Dovprela (pretomanid) for tuberculosis—now sit squarely in the government’s crosshairs.

Pfizer Korea’s workforce reductions follow global cost-cutting moves

Pfizer, which spun off its Upjohn division before it merged with Mylan to form Viatris in 2020, has launched its own round of voluntary retirements in Korea. 

The company declined to disclose how many jobs would be cut or the terms of severance packages but confirmed ongoing discussions with labor unions and stakeholders.

“This is based on headquarters’ mid-to-long-term business strategy,” a Pfizer official said. “It’s about making operations more efficient.”

Pressed on how staff reductions contribute to efficiency, the official only said, “The idea is to optimize management and adjust the workforce. As of now, no decisions have been made regarding changes to business divisions.”

And when asked whether the cuts were linked to Korea’s upcoming drug price policy, the official was blunt: “This has nothing to do with that.”

But Pfizer has been down this road before.

As post-pandemic revenue declined, the company launched a $3.5 billion global cost-cutting initiative in 2024. That same year, Pfizer Korea implemented a voluntary early retirement program, citing the need to streamline operations as Covid-related sales plunged.

It wasn’t the first time. In 2022, the company framed another ERP as an unavoidable restructuring measure, reallocating personnel and resources to “enhance expertise” and “meet evolving customer needs.”

And in 2015, amid labor disputes, Pfizer Korea announced another voluntary retirement program, restructuring its consumer healthcare division while the labor union protested potential targeted layoffs.

Now, a newly independent company is making the same move.

Vantive Korea offers severance packages as post-spinoff restructuring begins

Vantive Korea, which officially became an independent entity just four days ago after Carlyle Group’s acquisition of Baxter International’s kidney care business, is already offering voluntary retirements, according to industry sources.

Employees with at least 10 years of service and born on or before Feb. 28, 1985, are eligible. The severance package includes two months’ salary per year of service, plus an additional six months, capped at 42 months. 

Employees aged 50 and older will receive an additional 50 million won, those 45 and older will receive 30 million won, and those 40 and older will receive 15 million won. An extra 10 million won is provided per child, along with a one-month salary bonus for early departures.

Yet, at Vantive Korea, the uncertainty remains. A company official said there has been no formal notification or internal briefing on the restructuring.