Industry Mergers Impede New Pay Raises For Pharmaceutical Scientists

Average salaries paid to pharmaceutical researchers working in industry, academia, and government rose only slightly in 1993, according to a newly released survey from the American Association of Pharmaceutical Scientists (AAPS), an Alexandria, Va., professional organization. AAPS officials, as well as scientists in the field, attribute the modest increase to concerns over health-care reform. While such fears may have abated somewhat with the Republican takeover of Congress, salaries continue to be held down by the recent burst of merger activity--and consequent downsizing of scientific staff--among United States drug companies, they say. The survey found that the dampened mood also kept a lid on increases in average starting salaries for those beginning careers and prompted 32 percent of the respondents to report that they were considering changing jobs, a 4 percent rise from the previous year. To compile the survey, AAPS queried 7,319 members and received 1,874 replies, a response rate of about 26 percent. Industry researchers constituted about 83 percent of respondents, the largest group. Of these, approximately 86 percent were employed in pharmaceutical manufacturing. Academic scientists represented roughly 14 percent and government scientists less than 2 percent of the respondents. The study found that the most popular fields for Ph.D.'s were analytical chemistry and pharmaceutics. For all degree levels, the highest salaries were paid to individuals with backgrounds in physical chemistry--$82,700, on average. Those with training in toxicology and inorganic chemistry were the lowest-paid, reporting an average of $65,300. Although the study revealed some bright spots--for instance, the average salary paid to Ph.D.'s working in industry continues to increase at a steady rate--overall salary figures and employment opportunities were notably depressed by industry consolidation, according to observers. "I have not seen as many jobs advertised as in previous years," reports AAPS president Karl DeSante, a senior research scientist at Eli Lilly and Co. in Indianapolis. "I think there will continue to be demand, despite mergers. But there is downsizing going on as a result." The rash of mergers that occurred last year--such as that between New York-based American Home Products Corp. and American Cyanamid Co. of Wayne, N.J.--was not taken into account in the compilation of this survey, which reflected 1993 salary trends. The corporate belt-tightening affecting salaries reported in the study was a result of anxiety over health-care reform, according to the scientists interviewed for this article. While the flurry of activity in Washington, D.C., ultimately yielded little change on the health-care front, many companies began cutting costs in 1993 to compensate for having voluntarily placed caps on drug prices, a move designed to placate the White House. Although there has been a radical change in Congress since the survey was taken, with the Republican party gaining a majority in both houses, many drug-company researchers doubt that their fortunes will change soon. "The pharmaceutical industry got squeezed," says Robert Wills, vice president of project planning and management at Johnson and Johnson Inc.'s Pharmaceutical Research Institute in Raritan, N.J. "And from a scientist's perspective, most people felt the squeeze in their pocket. My guess is there will still be some falling out. In the next year or two, until all this sorts out, the big word in industry is cost-containment." Indeed, the average salary for degreed scientists in industry in 1993 was $74,500, a rise of only 1.2 percent over the 1992 figure. In academia, the average salary was $69,900, a 2.3 percent gain; in government, the average was $62,900, a 1.5 percent increase. In each case, the increases were less than inflation. Meanwhile, the average starting salary for those beginning careers was $48,000, an increase of only 1.5 percent over the average for novices in 1992. "A number of mainline companies are pretty much staying with the inflation rate, and some small companies that are struggling are bringing the average down," explains Eugene Fiese, project leader in the pharmaceutical research and development department at Pfizer Central Research in Groton, Conn. "And supply is very plentiful. I expect to see a glut in the market for some years." Adds Bob Baughman, senior vice president of operations and development at Emisphere Technologies Inc., a drug-delivery R&D company in Hawthorne, N.Y.: "There's no bidding war like there was in the '80s, because there's a lack of stability in the industry today. With what's going on [cost-cutting], some companies that are merging are wondering if they need another toxicology group. With this kind of environment, the answer is no. And people are not going to complain about getting a 4 or 5 percent raise. The company might offer bonuses or stock, but is not going to do it in salaries." Hope For Academia cademics, however, seemed to have had a slightly better time of it in 1993, according to the AAPS survey. The average salary for full professors was $88,600, a 2.7 percent increase over the 1992 level. Associate professors earned an average of $61,900, a 4.6 percent gain. The comparable figure for assistant professors was $49,300, a 5.8 percent rise. According to Stuart Speedie, a professor of pharmacy practice and science in the School of Pharmacy at the University of Maryland, Baltimore, who compiled the AAPS survey, the discrepancy between these results and the more modest 2.3 percent rise in the overall average salary for academics was attributed to a drop in wages paid to staff members with Pharm.D.'s compared with Ph.D.'s. "Nonetheless, what we see in academia is that it's fairly difficult to recruit people," he says. "Up until fairly recently, industry had been more attractive and there's still a salary gap, [which could close] as academia tries recruiting more people." The survey found that the average increase in salary for female Ph.D.'s in academia doubled to 10.8 percent in 1993. However, among those working in all employment sectors, only 44.9 percent of women held Ph.D.'s, as compared with 66.9 percent of men, representing a 5.5 percent drop from 1992 in the proportion of women holding Ph.D.'s. Some academics contend that the outlook has improved, in part, because the cutbacks in many state budgets appear to have crested, suggesting a more stable salary environment over the next few years. "We hope better days are ahead of us. We're now starting to come out of it, but we're not quite there yet," notes Patrick McNamara, a professor and associate dean for research at the University of Kentucky's School of Pharmacy in Lexington. "I'd say the prospects, at least right now, look better in academia than industry. Some faculties are expanding. I think we'll see steady 2 to 5 percent increases" in salaries. Edward R. Silverman is a freelance writer based in Millburn, N.J. BASE ANNUAL SALARIES OF PHARMACEUTICAL RESEARCHERS, 1993 VS. 1992 Years of Experience 0-5 5-10 10-20 20-30 30+ Overall Mean %Chng Mean %Chng Mean %Chng Mean % Chng Mean %Chng Mean %Chng (%Chng = % Change) Men B.S. $37,600 -7.4 $48,700 +3.8 $64,400+4.1 $75,500+7.5 $85,900+22.0 $63,700+6.3 M.S. * * 51,500 +1.4 61,300-4.4 94,200+14.6 106,500+28.5 67,700+2.0 Pharm.D. * * * * 91,800+1.9 100,100-6.9 * * 83,200+2.4 Ph.D. 58,100+2.5 70,600+2.0 89,000+3.1 103,300+3.4 109,500-9.5 86,100+2.4 -------------------------------------------------------------------------------- Total 54,400+3.2 64,700+2.7 80,000+2.3 91,900-1.2 106,000+6.2 79,200+2.1 -------------------------------------------------------------------------------- Women B.S. 37,100** 43,200+2.6 56,600+2.2 70,400+7.5 * * 52,000+3.6 M.S. 41,500** 49,100+6.0 59,200-5.9 68,100-6.8 * * 54,600-6.8 Pharm.D. * * * * * * * * * * 68,200-6.4 Ph.D. 58,000+1.2 65,800+0.3 85,100+10.8 * * * * 71,800+5.4 --------------------------------------------------------------------------------- Total 49,200-6.1 55,900 0.0 68,800 +3.8 76,800-2.9 80,800 * 61,600+0.3 -------------------------------------------------------------------------------- Men and Women B.S. 37,300-5.3 45,800+3.4 61,700+3.7 74,100+7.1 81,500+14.0 59,200+4.8 M.S. 41,800+2.0 50,500+2.2 60,600+4.9 73,300-7.9 103,200+27.7 63,700-0.9 Pharm.D. 53,900+4.7 78,900** 90,400+2.5 102,000-3.3 * * 81,300-1.3 Ph.D. 58,100+2.1 69,000 +1.3 88,300+4.3 102,600+3.2 108,600-7.8 83,500+3.1 --------------------------------------------------------------------------------- Total 52,400-0.4 61,200+1.3 77,300+2.9 89,700-1.4 103,400+5.5 74,500+1.2 --------------------------------------------------------------------------------- Employed in Academia Professor * * * * 73,800-3.8 87,900+2.0 97,600+7.4 88,600+2.7 Associate professor * * 58,000+8.4 63,100+7.5 * * * * 61,900+4.6 Assistant professor 47,900+4.1 49,900+4.6 * * * * * * 49,300+5.8 * Figures not reported if sample is fewer than 10 respondents. ** No salary figure reported in 1992. Source: AAPS

Industry Mergers Impede New Pay Raises For Pharmaceutical Scientists

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