Pharmaceutical Industry Faces Widespread Layoffs Amid Strategic Shifts and Financial Pressures

The pharmaceutical and biotech sectors continue to experience significant workforce reductions as companies realign priorities, respond to clinical setbacks, and aim to extend cash runways in a challenging economic environment.

Major Players Implement Large-Scale Job Cuts

Bristol Myers Squibb (BMS) is expanding 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 reductions by the end of 2025. The dramatic restructuring has resulted in over 1,300 layoffs so far in 2024, with more expected as BMS aims to become "leaner, more efficient" while investing in growth areas.

Novartis is also continuing its multi-year restructuring effort, recently disclosing plans to lay off nearly 140 more employees from its New Jersey site. This follows earlier cuts of up to 8,000 jobs announced in 2022. The company cites the need to "build future capabilities and access global talent pools" as it optimizes its global footprint.

Biotech Firms Face Difficult Decisions After Clinical Setbacks

FibroGen announced it will eliminate 75% of its U.S.-based workforce after two late-stage trials failed to meet primary endpoints. The company is implementing an "immediate and significant" cost reduction plan to terminate its pamrevlumab program and halt related obligations.

Athira Pharma will lay off about 70% of its workforce following disappointing Phase II/III results for its Alzheimer's disease candidate fosgonimeton. The company will now focus resources on advancing clinical development of ATH-1105 for neurodegenerative diseases.

Strategic Realignments Drive Workforce Changes

Bluebird bio is cutting about 25% of its workforce as part of a restructuring aimed at reducing cash operating expenses by 20%. The company will focus resources on commercial launches of its gene therapies for sickle cell disease, cerebral adrenoleukodystrophy, and beta-thalassemia.

Vir Biotechnology announced a 25% workforce reduction, eliminating approximately 140 roles, as it shifts focus away from COVID-19 and influenza programs to concentrate on hepatitis B and D therapies and expand into oncology through a deal with Sanofi.

Industry-Wide Trend Reflects Ongoing Challenges

The widespread layoffs reflect broader challenges facing the pharmaceutical and biotech sectors, including pricing pressures, pipeline setbacks, and the need to reallocate resources to high-priority programs. As companies strive to streamline operations and extend cash runways, the industry landscape continues to evolve, with significant implications for both employees and drug development efforts.