Layoffs Continue to Sweep Across Biotech and Pharma Industries

The pharmaceutical and biotechnology sectors are experiencing another wave of workforce reductions as companies aim to cut costs, extend cash runways, and refocus their pipelines. This trend, which began in 2024, shows no signs of slowing down in 2025.

Major Players Announce Significant Job Cuts

Several large pharmaceutical companies have recently announced substantial layoffs. Novartis is reducing its U.S. workforce by 427 employees at its East Hanover, New Jersey headquarters. The cuts will take place from June to October this year. This follows the company's December 2024 decision to let go of 330 employees as part of closing sites in Germany and Boston.

Bristol Myers Squibb continues its cost-cutting measures, announcing an additional $2 billion in savings planned through 2027 on top of an ongoing program targeting $1.5 billion in cuts by the end of 2025. The company is laying off 223 employees in Lawrenceville, New Jersey, bringing the total number of job cuts at that location to 290 this year.

Merck has revealed plans to eliminate about 6,000 jobs globally, affecting around 8% of its workforce. The layoffs are part of a multiyear process aimed at saving $3 billion by 2027. The company is also shutting down its manufacturing site in Pennsylvania, which will result in 163 job losses.

Biotech Firms Face Tough Decisions Amid Funding Challenges

Smaller biotech companies are also feeling the pressure to reduce costs and extend their cash runways. Intellia Therapeutics announced a 27% reduction in its workforce, affecting approximately 142 employees. The company is discontinuing development of its NTLA-3001 therapy for alpha-1 antitrypsin deficiency-associated lung disease to focus on high-value programs.

IGM Biosciences is cutting 73% of its workforce, laying off 100 employees, and halting development of two autoimmune drug candidates. The company is exploring strategic alternatives to maximize shareholder value.

Cargo Therapeutics disclosed plans to lay off 81 employees, representing about 50% of its staff. The company is discontinuing a mid-stage study of its lead candidate and reevaluating its pipeline.

Industry-wide Trend Reflects Changing Market Dynamics

The widespread layoffs across the pharmaceutical and biotech sectors reflect broader challenges facing the industry. Companies are grappling with the need to streamline operations, prioritize promising pipeline candidates, and adapt to a more challenging funding environment.

Many firms cite the need to extend cash runways and focus resources on key programs as primary drivers for workforce reductions. Additionally, some companies are restructuring to prepare for upcoming clinical trials or to shift focus towards more promising areas of research.

As the industry continues to evolve, it's likely that further job cuts and restructuring efforts will be announced in the coming months. Companies will need to carefully balance cost-cutting measures with the need to maintain innovation and progress in drug development.