Biogen Idec announced a major restructuring today that includes layoffs, plant closings and consolidation, killing clinical programs, and management/sales force reorganization. The company will become more focused.
Major elements of the restructuring include:
- Layoffs of 13% of its workforce or 650 workers
- Closure of the San Diego, Wellesley and Waltham facilities
- Shut down of 11 clinical programs - including cardiovascular and oncology in San Diego site
- Elimination of the Rituxan oncology and RA sales force
- Consolidation of business development, venture development and corporate strategy management/functions
The plan is expected to save $300 M annually. It will result in a restructuring charge of $115 M. Wellsley and Waltham will lose about 80 employees and operatins will be consolidated at the Cambridge and Weston sites. San Diego will lose about 300-325 jobs and the oncology and CVS programs. About 25% of the San Diego workforce will be offered jobs in either the Cambridge or RTP, NC sites. The new company will have 4,275 employees after cuts.
Biogen will retain its Tysabri, Avonex and Rituxan franchises - though Rituxan will be sold by Genentech's sales force. New development will concentrate on neurology products like a new oral MS drug called BG-12 and a longer lasting pegylated-IFN to replace Avonex. See Xconomy here and here.
“The company will leverage its immunobiology, process development and biologics manufacturing expertise to target high-potential treatments for select disorders where there is a significant unmet need and where the drug candidate has the potential to be highly differentiated,” the company said.
Even though the company has only launched 1 drug in the past six years, it says it will launch 5 new drugs in the next five years. We shall see.
Posted by Bruce Lehr November 3rd 2010.