CSL Announces Strategic R&D Restructuring, Shifts Focus to External Partnerships

Australian biopharmaceutical giant CSL has unveiled plans for a significant restructuring of its research and development operations, aimed at enhancing efficiency and adapting to the evolving global pharmaceutical landscape. The company's new strategy involves consolidating its R&D teams and increasing its focus on external partnerships to drive innovation and pipeline growth.

R&D Consolidation and Workforce Reduction

CSL is set to streamline its R&D operations by consolidating teams around six strategic sites located in key biotech hubs. This move is part of a broader effort to reduce duplication and improve operational efficiency across the organization. While specific numbers have not been disclosed, the restructuring will result in a reduction of the company's global internal R&D workforce.

A CSL spokesperson stated, "We will increasingly depend on a more optimal mix of internal capabilities and external partnerships to build and deliver our R&D pipeline. This will require a smaller global internal workforce in the future."

The company plans to provide more detailed information about the impact on employees during its annual earnings results presentation in August.

Strategic Shift Towards External Collaborations

As part of its new R&D strategy, CSL is placing greater emphasis on external partnerships to complement its internal capabilities. This approach is designed to enhance the company's flexibility in R&D spending and accelerate innovation across its diverse portfolio of products.

CSL's business units, including CSL Behring, CSL Seqirus, and CSL Vifor, cover a wide range of therapeutic areas such as rare diseases, immunodeficiencies, neurological disorders, vaccines, and iron deficiency. The company's strategic platforms encompass plasma technology, recombinant technology, cell and gene therapy, and vaccine technology.

Ongoing Challenges in Gene Therapy

The restructuring announcement comes in the wake of recent setbacks in CSL's gene therapy programs. In late 2024, the company closed its U.S. R&D hub for cell and gene therapy in Pasadena, California, affecting approximately 60 employees. This decision was part of a larger reassessment of CSL's ex vivo lentiviral vector-based gene therapies, with additional changes implemented at facilities in Germany, Switzerland, and Australia.

CSL Behring's hemophilia B gene therapy, Hemgenix, has faced challenges since its approval in late 2022. Despite being on the market for over 18 months, only 12 patients had received the treatment as of June 2024. The company estimates that about 1,000 Americans could potentially benefit from Hemgenix, highlighting the limited patient pool for such specialized therapies.

These developments reflect broader industry trends, as evidenced by Pfizer's recent decision to discontinue its competing hemophilia B gene therapy, Beqvez, due to limited patient uptake following its FDA approval in April 2024.