Pharmaceutical Industry Faces Continued Workforce Reductions Amid Strategic Shifts

The pharmaceutical and biotech industries continue to experience significant workforce reductions as companies realign their strategies and resource allocation. Recent announcements highlight the ongoing trend of layoffs and restructuring efforts across the sector.

Major Players Implement Cost-Cutting Measures

Bristol Myers Squibb (BMS) is expanding its previously announced cost-cutting initiative, now targeting an additional $2 billion in savings through 2027. This comes on top of an ongoing program aimed at $1.5 billion in cost reductions by the end of 2025. The dramatic restructuring, initiated when CEO Chris Boerner took the helm in 2023, has resulted in numerous layoffs and program discontinuations. BMS plans to achieve these new savings through organizational design changes and enhanced operational efficiency.

Novartis is continuing its multiyear restructuring effort with the announcement of 427 layoffs at its U.S. headquarters in East Hanover, New Jersey. These cuts will take place from June to October 2025. This follows previous reductions, including the elimination of 330 positions in December 2024 related to site closures in Germany and Boston. Novartis has been actively pursuing bolt-on acquisitions to drive growth, recently betting $3.1 billion on Anthos Therapeutics and $1.1 billion on gene therapy company Kate Therapeutics.

Biotech Firms Face Setbacks and Strategic Pivots

Illumina's spinoff Grail is laying off about 350 employees, representing approximately 25% of its workforce as of June 30. The reduction is part of a restructuring plan aimed at reprioritizing resources to focus on Grail's core multicancer early detection business. The company expects these cost reductions to extend its cash runway from the second half of 2026 into 2028.

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. This follows a previous round of layoffs in 2023 after another Phase III failure.

Gene and Cell Therapy Sector Faces Challenges

Gene therapy company uniQure is laying off 65% of its employees, totaling 300 people, including Chief Operating Officer Pierre Caloz. The move came a month after uniQure revealed it had agreed to sell its Lexington, Massachusetts manufacturing facility to Genezen. CEO Matt Kapusta stated the actions are designed to ensure funding for key milestones and drive shareholder value.

Vir Biotechnology announced it will lay off 25% of its workforce, eliminating approximately 140 roles across its operations. The reduction is part of a major shift in research and development priorities, abandoning work on COVID-19 and influenza, as well as its T-cell-based viral vector platform. Vir will instead focus on its hepatitis B and D programs and move into the cancer space via a deal with Sanofi.

As the pharmaceutical industry continues to evolve, companies are making difficult decisions to streamline operations, focus on core assets, and maintain financial stability in an increasingly competitive landscape. These workforce reductions reflect the ongoing challenges and strategic realignments within the sector.