Layoffs Continue to Reshape Pharmaceutical Industry Landscape in 2025

The pharmaceutical industry continues to face significant restructuring and workforce reductions in 2025, as companies adjust to changing market dynamics, pipeline setbacks, and financial pressures. Recent months have seen a wave of layoff announcements from major players and smaller biotechs alike, signaling ongoing turbulence in the sector.

Big Pharma Trims Workforce Amid Strategic Shifts

Several large pharmaceutical companies have announced substantial job cuts as part of broader restructuring initiatives. Bristol Myers Squibb plans to eliminate approximately 2,200 positions by the end of 2025, with recent layoffs affecting 223 employees at its Lawrenceville, New Jersey site. The company aims to generate $2 billion in savings through 2027 by streamlining operations and enhancing efficiency.

Pfizer is also continuing its cost-cutting measures, with plans to reduce expenses by $3.5 billion through 2024. The company has laid off 210 manufacturing employees across sites in Ireland and announced further cuts at facilities in North Carolina. These reductions are part of Pfizer's efforts to optimize its manufacturing network and increase productivity.

Novartis has initiated another round of layoffs, cutting 427 positions at its U.S. headquarters in East Hanover, New Jersey. This follows previous workforce reductions and site closures as the company pursues a $1 billion cost savings initiative. Novartis has stated these changes are aimed at becoming "leaner, more efficient" while investing in growth areas.

Biotech Sector Faces Continued Pressure

Smaller biotechnology companies have not been immune to the industry-wide trend of downsizing. Recursion Therapeutics announced a 20% reduction in its workforce, affecting approximately 70 employees, as it seeks to streamline operations and extend its cash runway. The company plans to focus resources on advancing its most promising drug candidates.

Cargo Therapeutics revealed plans to lay off 50% of its staff, or 81 employees, following disappointing clinical trial results for its lead CAR-T therapy candidate. The company is discontinuing a Phase II study and reevaluating its pipeline priorities in light of the setback.

Illumina's spinoff Grail announced a 25% workforce reduction, eliminating about 350 positions as it narrows its focus to its core cancer detection business. The restructuring is expected to extend Grail's cash runway into 2028 as it works towards completing registrational studies for its galleri test.

Pipeline Setbacks Drive Strategic Realignments

Several companies have announced layoffs in response to clinical trial failures or regulatory setbacks. FibroGen disclosed plans to cut 75% of its U.S.-based workforce after two late-stage trials for its pancreatic cancer drug pamrevlumab failed to meet primary endpoints. The company is terminating the pamrevlumab program and implementing significant cost reductions.

Sage Therapeutics announced it will lay off over 165 employees, or about 33% of its workforce, following the discontinuation of its Alzheimer's disease program. The restructuring aims to support the ongoing launch of Zurzuvae for postpartum depression and focus resources on other pipeline candidates.

Atara Biotherapeutics is reducing its staff by approximately 50% after the FDA rejected its T cell therapy for a transplant-related blood cancer. The company is reevaluating its pipeline and exploring strategic alternatives in light of the regulatory setback.

As the pharmaceutical industry continues to navigate challenges in drug development, market pressures, and evolving strategic priorities, further workforce reductions and organizational changes are likely to shape the sector throughout 2025 and beyond.