NEW YORK (CNNMoney.com) -- Eli Lilly and Co. will cut 5,500 jobs as part of a restructuring plan to save $1 billion, the drugmaker said Monday.
The job cuts will be complete by 2011, according to a press release. Eli Lilly currently employs 40,500 people.
"We remain confident that continued focus on medical innovation is the best way to ensure the long-term growth of our company," said chief executive John Lechleiter, in a written statement.
The pharmaceutical industry "is facing unprecedented challenges," according to Lechleiter, who cited "slowing innovation, rising costs, patent expiries and increased generic competition, demands from payers to deliver greater value, and health care reform."
Eli Lilly "faces these and its own challenges," the release said, including a patent expirations for some of its main products beginning in late 2011.
Lilly announced the establishment of a Development Center of Excellence, geared to streamline new medicines. The company has more than more than 60 molecules currently in clinical development, and said the reorganization should "help accelerate the progress of the...pipeline," Lechleiter said.