Teva Pharmaceutical Industries will reduce its global workforce by 10 percent. The Israeli company has its North American headquarters in North Wales, Pa.
Teva is the world's largest manufacturer of generic drugs. But it's estimated that half of its profits come from sales Copaxone, a multiple sclerosis treatment.
The company's exclusive patent right to the lucrative drug is set to expire and it will have to compete with other generic manufacturers.
George Chressanthis, a professor at Temple's Fox School of Business, says Teva has also grown by acquiring other companies. It may have assets it doesn't need.
"Some of it is excess capacity but adding resources where they need to get more involved in [research and development] or producing their own drugs; and not wait for the patented branded drugs coming from outside the generic industry to eventually go off patent," he said.
Teva says cutting 5,000 employees as part of the slimdown it began in 2012 will save the company $2 billion. It will put resources into generics production but also research and development.
The company has not said yet how many of the new cuts will affect Pennsylvania facilities. The company did not return WHYY's request for comment.