Tuesday, July 3, 2012
Roche to Cut Jobs, Close R&D Center
Roche, based in Basel, Switzerland, said it would close a site in Nutley, N.J., that has focused on early stage drug research for cancer and inflammatory and viral diseases. The company had already eliminated thousands of sales and marketing jobs at the site, which opened 80 years ago and once employed about 5,000 people, a Roche spokesman said. The Nutley labs are perhaps best known for discovering the sedative Valium in the 1950s.
In addition, Roche said its head of early stage pharmaceutical research, Jean-Jacques Garaud, would leave the company on June 30, to be succeeded by Mike Burgess, currently global head of oncology drugs.
A Roche spokesman declined to comment on the reason for Mr. Garaud's departure. The spokesman said neither Mr. Garaud nor Mr. Burgess was available for comment.
Like Mr. Garaud, Mr. Burgess will oversee drug research at Roche laboratories outside of Genentech, the California biotech company Roche fully acquired in 2009.
Genentech research will continue to run as an independent unit within Roche and is unaffected by Tuesday's changes, Roche said.
In a statement, Roche Chief Executive Severin Schwan said the company needed to make the cuts to early stage research to ensure it had enough money to fund the large number of experimental drugs it is putting through clinical testing. "The overall number of programs in clinical development has grown substantially," he said. The job cuts "will free up resources that we can invest in these promising clinical programs while also increasing our overall efficiency."
Big drug companies have cut thousands of R&D jobs in recent years as in-house laboratories have failed to deliver enough new medicines.
Many companies have instead started buying more experimental medicines from outside biotech companies that they can put through large clinical trials.
Despite the cuts, Roche will remain one of the industry's biggest spenders on R&D.
The layoffs will mean the company now has about 2,000 Genentech scientists engaged in early stage drug research, and another 2,000 employed directly by Roche, down from 3,000.
The company will also continue to have thousands more scientists engaged in drug development, the stage of R&D that handles clinical testing.
Roche said it would transfer about 240 scientists from Nutley, N.J., to a new early stage research facility at a yet-undecided location on the East Coast.
A small number of additional scientists will also be transferred to Roche sites in Switzerland and Penzberg, Germany.
By Jeanne Whalen from WSJ
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