It seems like pharmaceutical layoffs are in full flow as FibroGen and Boston Sciences have announced they are letting people go, albeit for different reasons.
Following a failed phase 3 lung disease trial, Fibrogen stated it would be cutting off 32% of its workforce, or 104 people. Approximately $15 million will be the cost of layoffs, as estimated by the company. The bulk of the restructuring is projected to take place this quarter and be finished by the beginning of 2024. The annual savings of up to $35 million from these measures will help extend the company’s liquidity runway to 2026.
The firm stated, “The Company would like to extend its tremendous gratitude to these employees, not only for their contributions to the strong workforce and culture at FibroGen, but to their large part in the progress we have made, and continue to make, in science and the biotechnology industry.”
Two recent phase 3 setbacks for pamrevlumab prompted the firm to look into a large cost reduction initiative in the U.S., which many feared would include layoffs. Although specifics were unavailable at the time, a representative did say the company would be considering these options in the weeks ahead.
Pamrevlumab had a disappointing start to June, as it failed to boost function in individuals with non-ambulatory Duchenne muscular dystrophy in a phase 3 experiment. A few weeks later, another phase 3 trial using the medication to treat idiopathic pulmonary fibrosis failed to meet its primary aim.
In May, the anemia therapy Evrenzo, which is already on the market, failed to prove its worth among individuals with myelodysplastic syndromes. Astellas owns the drug in Europe and Japan, and while Chinese regulators have given FibroGen the thumbs up, their American counterparts have been unmoved.
Meanwhile, Boston Scientific’s layoffs come as a result of the permanent closure of a facility in the San Francisco Bay area.
The medtech firm announced the closure in a file with the California Employment Development Department. According to the EDD’s records, the agency did not receive the WARN notification – issued on June 12 – until this week.
The relevant facility is in Fremont, California. The company had reportedly leased the nearly 140,000-square-foot building last year but appeared to have moved into it just recently.
The closure will impact 52 employees in total. These will include 47 company employees and five additional independent consultants working at the Fremont plant.
The layoffs will begin on August 11 and continue throughout the first quarter of 2024. The notice from Boston Scientific stated that the 47 non-consultant personnel would be eligible to seek other positions within the company and that all affected individuals would be informed of their respective termination dates 60 days ahead of time.
Once the facility is shut down, the firm has plans to relocate the work that was done at the facility to other company outposts located in Minnesota.