Genentech Joins Pharma Layoff Wave with Largest Restructuring in Two Decades Amid Strategic Pipeline Shift

Apr 11, 2024 19:50 CST Updated 19:50

Genentech

Pharmaceutical R&D Manufacturer

On April 10, a spokesperson for Genentech, a subsidiary of Roche, told the media,Genentech to Cut Workforce by 3%。

"The spokesperson said in an email: 'We regularly evaluate our operations to ensure that while continuing to provide innovative new drugs in the future, we can still well meet the needs of current patients.' The spokesperson stated,This round of layoffs will affect "multiple departments" at Genentech.。

And Genentech has also joined recently.The List of TOP Pharmaceutical Companies with Significant Layoffs。

Layoffs of approximately 400 people across multiple departments

According to data from the Genentech website, the company has approximately 13,500 employees.This is equivalent to cutting approximately 400 positions.The company has just undergone a leadership change, with Ashley Magargee, a 20-year veteran of Genentech, officially assuming the role of CEO on January 1.

A Genentech spokesperson stated that the company will “Redirect resources to areas where we believe they will have the greatest impact on patients.", and plans to keep the total number of employees stable throughout 2024.

Although the specific field is not specified, we might get a glimpse of it from its recent initiatives.

In the increased part:

Genentech, Inc. is an innovative pharmaceutical company under Roche, focusing on biotechnology and increasinglyApplication of Artificial Intelligence in Drug Development。

Roche has also been active in business development, recently signing an AI agreement with Nvidia, a gene-editing agreement with GenEdit, a molecular glue agreement with Orionis, and a radiopharmaceuticals agreement with PeptiDream, among others.

In the reduced part:

On March 20, Roche Pharmaceuticals sold one of its largest biologics manufacturing bases in California to Lonza, a leading CXO company, for a total transaction value of $1.2 billion.

And last May, Roche Pharmaceuticals announced plans to sell its Genentech plant in California, or close the plant before 2029.

The plant commenced operations in 1998;
Roche said that the divestment plan is "part of its strategy to adjust its production capacity based on future pipeline needs." According to the statement,The pipeline requires the production of increasingly personalized drugs for specific populations, rather than mass-producing biologics.

Genentech is one of the earliest Biotech companies in the industry and the pioneer of large-scale monoclonal antibody production technology.

Over the past 40 years, Genentech has produced a series of Roche's best-selling drugs, including: Herceptin (Trastuzumab), Rituxan (Rituximab), Avastin (Bevacizumab), Activase (Alteplase), Lucentis (Ranibizumab), etc.

But with the continuous development of technology, the first generation of biopharmaceutical factories is gradually "aging" —— much of the equipment in the factory has become outdated, some innovative processes cannot be implemented in this factory, and most importantly, there is insufficient production capacity. This is also considered one of the biggest reasons for Roche's decision to sell.

This also represents the current transformation of the biopharmaceutical industry from monoclonal antibody drugs to multi-specific antibodies, cell and gene therapies, AI-assisted new drug development, and other directions.

Sanofi, Novartis... R&D Teams Become "Hard-Hit Areas" in Layoffs

As large pharmaceutical companies change their pipelines and focus of work,Layoffs Become the First Step of Strategic Initiatives, Extending to Core Positions Such as R&D。

April 10,SanofiA WARN notice shows that it will be from a factory in San Francisco on June 3.Layoffs of 100 People, as part of its plan to divest Amunix Pharmaceuticals, the immuno-oncology company it acquired for $1 billion in 2021.

Due to the higher R&D costs in the oncology field compared to other therapeutic areas, and the likelihood of clinical trial success being very low.Sanofi Decides to Abandon "Several Oncology Research Projects".

At the end of October last year, Sanofi CEO Paul Hudson announced itsThe next chapter of the "Play to Win" strategy, which includes shifting resources to more successful therapeutic areas, such as autoimmune diseases.。

According to Sanofi's financial report at the time, this reallocation goal was part of a total cost-saving effort of 2 billion euros.Save approximately 700 million euros in China.

On April 5, Sanofi R&D head Houman Ashrafian told employees in an internal email that the company is conducting a comprehensive optimization and adjustment of its pipeline, which mayHalt Multiple Cancer Research Programs and Implement Layoffs，The specific number of layoffs is unknown.。

The email outlined Sanofi's ambitions – to build "an immunoscience powerhouse, accelerate the pace of new drug launches, and transform medical practice," as well as "streamline R&D structure," "look to the future," and "downsize."

On April 9, it was reported that Sanofi would close Kiadis Pharma, a Dutch NK cell therapy company acquired for nearly $400 million, part ways with it, and carry out layoffs.

April 9,NovartisInsert needleLay off 680 employees from the R&D team, specifically comprising: approximately 440 staff reductions at the Swiss headquarters and around 240 in the United States.

Novartis R&D Department Employs Approximately 12,500 People; Novartis Spokesperson States Considering a 1%-2% Reduction in Global R&D Team.
This is just the beginning. A Novartis spokesperson revealed to the media that the company plans to restructure its global R&D team over the next 2-3 years to maximize the value of its product portfolio and advanced technology platforms.

April 4,Boehringer IngelheimWith itsHumira BiosimilarCyltezo's slow market expansion leads to reduction in customer-facing sales force. Although the company did not disclose the number of layoffs, Stat News cited anonymous sources as saying that approximately70 employeesWill lose their job.

CR：

1、Genentech plans to cut 3% of workforce across several units, company says By endpts

2、Sanofi begins 'full pipeline reprioritization' with layoffs in tow, R&D chief tells staff By Fierce Biotech

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