Biogen to cut 11% of jobs
Cambridge, Mass.-based Biogen has announced a corporate restructuring that includes the termination of a number of pipeline programs and an 11% reduction in workforce. The changes are expected to reduce the current annual run rate of operating expenses by about $250 million. The company plans to reinvest the savings to support key commercial initiatives, including increased sales and marketing activities behind TECFIDERA, and the advancement of high-potential pipeline candidates in areas such as Alzheimer’s disease, multiple sclerosis and spinal muscular atrophy.
“We remain committed to maximizing the potential of our commercial portfolio, with a particular emphasis on Tecfidera,” said CEO George Scangos, Ph.D. “We continue to see growth for our market leading portfolio of MS products, driven by the uptake of our oral therapy Tecfidera in recently launched countries worldwide and the introduction of Plegridy to new markets.
“The decision to reduce the company’s workforce was extremely difficult, but we believe these actions are necessary to fulfill our mission of bringing important new medicines to patients. We have several high-quality programs that are now or soon will be in phase III, and the cost savings from the restructuring will be reinvested to carry out those programs aggressively and hopefully to bring them to patients as quickly as possible. We are grateful for the contributions of our talented and admired colleagues and we will do our best to treat everyone with fairness and dignity.”
The company plans to substantially complete the majority of the 11% reduction of its global workforce by the end of 2015. Biogen is in the process of notifying employees affected by the restructuring, and has initiated the required consultation processes in European countries where employees may be impacted. Biogen also has discontinued several programs, including its phase III program for Tecfidera in secondary progressive MS, the development of anti-TWEAK in lupus nephritis and certain activities in immunology and fibrosis research.
Implementing the changes is expected to reduce the current annual run rate of operating expenses by about $250 million. Biogen expects to incur a charge of between $85 million and $95 million, primarily in the fourth quarter.