The Beat Goes On: More Layoffs at Life Science Companies

Posted in BioBusiness

Despite assurances that the economy is improving, many life sciences companies are still continuing to downsize.  According to the Pharmalot Blog New Jersey-based Mylan (a generic drug manufacturer)  is laying off nearly 120 people from its specialty offices in Basking Ridge, New Jersey, as part of a reorganization that will consolidate the specialty operation near its Pittsburgh headquarters. The cuts were disclosed in a state filing. A spokeswoman says some employees may relocate. The company is also closing a specialty pharmaceutical plant in Napa, California, later this year which will result in the lost of 270 additional jobs.

Likewise, Massachusetts-based Alkermes  plans to eliminate up to 130 jobs from a plant in Ireland  and, last week, Bristol-Myers Squibb (BMY) revealed that roughly 300 employees will lose their jobs as part of a plan to close the San Diego headquarters occupied by Amylin Pharmaceuticals, which was acquired by BMS last year.

Today, another New Jersey company Unigene that is investigating delivery of proteins and peptide-based drugs announced that it would cut up to 40%of it workforce as it reorganizes and tries to stay in business.

Finally, Swiss pharmaceutical giant Novartis said Tuesday it is consolidating its U.S.-based eye disease research projects in Cambridge, Mass., and closing the Novartis Institutes for BioMedical Research group on its Alcon Labs campus in Fort Worth. About 120 employees in Fort Worth were told Tuesday their jobs will end June 11, The employees will be allowed to apply for jobs in Cambridge as well as for other positions with Alcon. Novartis acquired Alcon, an ophthalmic drug company in 2011 and has been working for the past few years to consolidate all of Novartis’ eye research centers in one location in Fort Worth.  Alcon currently employees about 4,800 people.

While these layoffs are noteworthy, the size of these layoffs pale in comparison to the carnage that took place in the pharmaceutical industry over the past five years. According to Challenger Gray & Christmas, the recruiting and consulting firm more only 3,100 pharmaceutical employees lost their jobs this year. However, Ed Silverman, who writes the Pharmalot Blog mentioned in a post today that “there is industry speculation that Merck will undergo more job cuts.”

Although the industry is still shedding jobs, it is likely that the worst is over and that new job opportunities will emerge in the US and elsewhere over time.

Until next time…

Good Luck and Good Job Hunting!!!!!!!!

Alcon Announces Plans to Expand Its Workforce In Texas

Posted in BioJobBuzz

Despite a stalling economy, there are signs that some American companies are hiring and helping to improve local economies. A good of example of this is Alcon Laboratories located in Fort Worth, Texas. The company, which specializes in vision products, today announced that it leased 87,000 sq. feet of office space to house 400 new employees that it is moving into the Fort Worth area.

The company immediately needed the space to accommodate employees relocating from Atlanta and to house new hires as the company plans to expand existing facilities in south Fort Worth. Alcon was acquired this past April by Novartis, which operate the Atlanta-based CIBA Vision and Novartis Ophthalmic Units which are being consolidated into Alcon’s existing Forth Worth operations. While some of Novartis’ Atlanta employees lost their jobs as a result of the Alcon acquisition, many of them are relocating to new jobs at the Forth Worth facility.

Alcon notified Fort Worth city officials that it plans on expanding its current workforce of 3,200 to about 4,000 and spends millions of dollars to expand existing facilities over the next few years. Ironically, while most big US pharmaceutical companies are slashing domestic jobs and investing in emerging markets like China and India, Novartis, a Swiss company, is investing in America! Go figure!!!!!!!

Until next time…

Good Luck and Good Job Hunting!!!!!!  

 

Post Labor Day Job Cut Report

Posted in BioJobBuzz

Despite the fact that no new jobs were added to the US economy in August, things were pretty quiet in the pharmaceutical layoff space. From what I was able to find, it appears that Alcon Laboratories will be moving about 100 jobs from Atlanta to Fort Worth Texas (I was recently in Fort Worth for the first time and I extend my sympathies to those Atlantans that may make the move). The consolidation is taking place because Novartis purchased Alcon in April and after acquisitions these sorts of things happen. Nestle, another Swiss company, had a majority ownership in Alcon. 

Interestingly, there appears to be some consolidation also taking place in the contract manufacturing space. Contract Pharma announced that it would close its Buffalo, NY manufacturing facility (purchased from Bristol Myers Squibb in 2005) and eliminate 128 jobs. Those employees who do not lose their jobs may have an opportunity to work in a nearby Ontario, Canada site. Likewise, UK-based United Drug, another CMO, will cut 150 jobs because of government-led regulatory decision to reduce health spending.

While none of these announcements were particularly noteworthy, Sanofi-Aventis’ announcement today that it will cut $2.9 billion in costs over the next few years was somewhat shocking but not unexpected. Most of the cuts will be in R&D and there will undoubtedly be massive downsizing and reorganization. 

According to a post on today’s Pharmalot blog “a presentation indicates that research and development costs are in the process of being cut by 12 percent from 2008 to about $1.1 billion, excluding Genzyme. And the total headcount over this same period is being reduced by about 22 percent, from roughly 13,000 positions to about 10,000 jobs by the end of this year, again excluding Genzyme.”

Today’s announcement of cut back is consistent with Sanofi’s business strategy over the past year or so which included plant closings and large sales rep layoffs Again, the Pharmalot blog reported “The upcoming round involves slashing about $700 million in expenses from Genzyme, the biotech that Sanofi purchased recently, as oncology units in the Boston area are combined.”

The cost cutting measures are in response to the impending loss of patent exclusivity for several of its blockbuster products most notably Plavix and unexpected attrition in the company’s late stage clinical development portfolio. This year sales of products facing patent expiry are expected to decline to $4.2 billion as compared with $10.6 billion in 2008. To cope with these difficulties, Sanofi has gone on a buying spree over the last couple of years spending $23 billion to acquire various companies with Genzyme being the crown jewel.

Meanwhile, Sanofi plans to file for approval of six new drugs this year and hopes that it can introduce 19 new drugs by 2015. I suspect that Sanofi’s aggressive M&A strategy may help the company reach that goal. That said, if I was a Sanofi or Genzyme employee, I would be dusting off the old resume right about now.

Until next time…

Good Luck and Good Job Hunting!!!!! 

Novartis Offers $38.5 Billion to Purchase Alcon and Position Itself as a World Leader in the Eye Care Market

Posted in BioBusiness

Novartis AG today announced it plans to take over Alcon Inc. by paying $38.5 billion for the 77 percent stake it does not already own in a deal that would make it one of the biggest players in the global market for eye-care products.

The Swiss pharmaceutical and generics giant had already purchased 25 percent of Alcon from Nestle in April 2008 for $11 billion, with the option of buying the food and drinks company’s remaining stake at a later date. With the acquisition of Alcon, Novartis will control about 70% of the world’s vision market (it already owns the Ciba Vision brand). Alcon is based in Huenenberg, Switzerland, and has its U.S. headquarters in Fort Worth, Texas. The company employs some 15,000 people worldwide and specializes in surgical equipment and devices, contacts lens solutions and other consumer eye-care products.

Daniel Vasella, MD, Novartis’ Chairman and CEO, said "This is the right time to simplify Alcon’s ownership to eliminate uncertainties for employees and shareholders." He added "It will also allow us to strengthen innovation power by combining R&D efforts and grow our global market presence thanks to our complementary product portfolios."

If I were a betting man, I would say that Novartis is the pharmaceutical company to watch over the next decade. Like Johnson and Johnson, the company has diversified its business to include consumer goods, vaccines and perhaps most importantly generic pharmaceuticals via its Sandoz division. One area that Novartis hasn’t fully embraced to date is devices. However, as we enter the age of personalized medicine, don’t be surprised if the company acquires or invests in a variety of medical devices and diagnostic companies!

Until next time…

Good Luck and Good Job Hunting!!!!!!!!

 

Another US Biotechnology Company Bites the Dust: Japan's Takeda Pharmaceuticals to Buy Millennium Pharmaceuticals

Posted in BioJobBuzz

Takeda Pharmaceutical Co., Japan’s largest pharmaceutical manufacturer, announced that it has agreed to buy Cambridge MA-based Millennium Pharmaceuticals for $8.8 billion. Millennium, founded in 1993 by high profile MIT researchers and once heralded as one the most innovative American biotechnology companies, never lived up to analyst’s expectations. That said, the company did develop and win regulatory approval for an anti-cancer drug, Velcade, which is expected to garner additional approval for wider use in oncology later this year.

Velcade, which is used to treat relapsed multiple myeloma after other drugs fail generated more than $800 million last year. Millennium anticipates U.S. approval by June to promote Velcade as an initial therapy to treat these disorders. Millennium markets Velcade in the US and shares revenue with Johnson & Johnson which markets Velcade in 85 other countries. Analysts predict that the Takeda acquisition will help to propel Velcade to blockbuster status.

The Takeda-Millennium deal follows Eisai Co.’s (another Japanese company) agreement in December to buy the U.S.’s MGI Pharma Inc. for $3.9 billion as Japanese companies, aided by a weak dollar against the yen, seek growth abroad. Japanese companies have been hampered by government-ordered price cuts, weak pipelines and a lack of new products  As one financial analyst put it “There’s no doubt the weak dollar against the yen is making U.S. biotech very attractive right now to potential Japanese buyers,”

Takeda’s best seller is the diabetes drug Actos which is slated to lose patent protection in the near future. Acquisition of Millennium provides Takeda with an entrée into the oncology and cardiovascular markets both of which are poised for expansive growth in the next five years. Analysts also believe that the Millennium acquisition will boost Takeda’s drug discovery and development flow. Millennium is conducting human trials with experimental drugs for cancer, heart disease, gastrointestinal disorders and rheumatoid arthritis.

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