Restructuring, Workforce

No more hands-off Roche supervision? Genentech brings out the axe, slashing 223 HQ staffers ‘across departments’

Genentech is whacking 223 staffers at its headquarters base in South San Francisco.

The news was filed with the state of California in a WARN notice about upcoming cuts, received on August 9.

In a reply to my query, a spokesperson for the company noted: “The positions are in South San Francisco and varied across departments.” There were no details on who will be cut, though the layoffs will run into November.

The company did not respond to my query about whether this was the first such cut at HQ.

Genentech is one of the most successful big biotechs in the industry, coming up with a string of new drugs. And while parent company Roche — one of the biggest R&D spenders in biopharma with a research budget of about $8 billion — has been adding a set of new blockbusters to its portfolio, it also faces biosimilar competition for several of its biggest franchise therapies.

It’s not unusual to see hundreds of jobs gained or lost at the big players’ manufacturing operations. Last fall Genentech cut 130 staffers at its Vacaville, CA manufacturing facility. But Roche has been particularly sensitive about leaving its main Genentech operations free of the kind of buttoned-down scrutiny that applies to the Roche side of the business.

This new reorganization seems to signal an end to that hands-off attitude.

Tim Anderson, who recently left Bernstein, had a chance not long ago to sit down with Roche CEO Severin Schwan, who may have signaled what was coming. Was Schwan interested in integrating the two big R&D groups at Roche’s pRED and gRED? 

“Over my dead body,” replied the CEO. But that didn’t mean Schwan had stopped looking for ways to carve costs out of the research and development groups.

There are areas where he concedes ROG is not very productive, for example, data management. ROG is building data sets that share common systems across business units, where there’s not only an efficiency element, but also a productivity element when you can better share data. ROG has talked a lot about leveraging real-world data, but it starts with sharing your own data from your own clinical trials too. So, they’re doing both in parallel.

FiercePharma was the first to report the cuts.

Here’s the full statement Genentech has:

At Genentech, we pursue groundbreaking science to develop breakthrough medicines for people with serious diseases. The success of our business depends on our ability to respond to change, appropriately allocate resources, and manage our operations efficiently.

We have been evaluating some of our operations to ensure we remain well-positioned to meet the needs of patients today and deliver on our pipeline of new medicines in the future. As a result of this process, we have made the difficult decision to eliminate some positions.

We greatly appreciate the significant contributions of those impacted by these changes and will support them through this transition with financial benefits, extended healthcare coverage, and career coaching.


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