GlaxoSmithKline’s global restructuring was felt sharply in North Carolina this week as it announced plans to cut 900 jobs in Research Triangle Park (RTP), where it has 2,500 employees and contractors working in research and development.
But approximately 450 of those losing their jobs will be offered employment in a new business unit being creating by Parexel, a CRO with operations in Durham, N.C. Under a letter-of-intent signed by the two companies, the new unit will provide a variety of clinical development services to GSK and to other sponsors, and will be based largely in the RTP area.
Parexel declined to discuss the new business unit or the additional employees. Since 2010, the CRO has been a strategic partner of GSK.
GSK has informed the North Carolina Department of Commerce of its plans to eliminate 450 jobs in the second quarter of 2015. The London-based pharma company said the reorganization is part of an R&D consolidation in both the Philadelphia area and Stevenage in the U.K. The company has 4,500 employees and contractors in North Carolina, including 2,500 who work in R&D. Some R&D staff will be relocated to the Philadelphia area, GSK said.
“The aim of the program is to improve performance by taking unnecessary complexity out of our global operations and establish a smaller, more focused organization operating at lower costs to support our future portfolio,” Stephen Burr, a GSK senior vice president for human resources, said in the letter to state officials.
Some of the cuts also affect employees at GSK’s pharmaceutical business in RTP, Philadelphia and in field offices around the country, the company said. However, employees at the company’s manufacturing facility in Zebulon, N.C., will not be affected, nor will retail sales teams.
Earlier this week, the company said the job cuts are part of a three-year process to eliminate $1.57 billion in annual expenses stemming from the dramatic slide in sales of Advair, a popular bronchodilator to prevent asthma attacks and chronic obstructive pulmonary disease (COPD) flare-ups. Once a GSK flagship product, its sales have plunged since the inhaler came off patent and it continues to face stiff competition from newer inhalation therapies, notably Symbicort from AstraZeneca and similar products from Teva Pharmaceutical Industries and Novartis’ Sandoz unit.
“Our proposed changes in R&D will sharpen the focus in discovery and development and reduce funding in certain areas of the pipeline,” GSK said in a statement.