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Big Pharma Cuts, Current and Coming

Word came out just before the weekend (first at Endpoints) that GlaxoSmithKline is laying off R&D employees at both Stevenage (UK) and Upper Providence (US). Current leadership is re-organizing drug discovery efforts to put more emphasis on oncology, immunology and genetic-linked disease, and this moves seems linked to that. Reports are that overall R&D head count is supposed to increase as the strategy takes effect, but (as usual) it’s a lot easier to identify people and positions that don’t fit than it is to hire in people that you think do. John Carroll’s sources told him that chemistry is getting hit particularly hard in this round, actually. The number of re-thinks that GSK has been undergoing over the last few years seems to an outside observer to be impressive, but only in the glad-I’m-not-doing-that sense of the word.

And in other big-company news, you will have seen that it looks like the Bristol-Myers Squibb/Celgene deal is indeed going through after a shareholder vote. Management expects the deal to close in the third quarter of this year, which means, realistically, that productivity at both companies (and especially Celgene) will be taking a hit for all of 2019. Job cuts are surely coming at some point as a result of all this; it’s hard to see how it can be otherwise. But I see that the company’s CEO (Giovanni Caforio) is saying that they’ll be able to launch six new drugs in the next two years, now that they’re revving up to be such a powerhouse and all. But this is what CEOs always say after big mergers and acquisitions, and somehow the turbochargers don’t always seem to quite kick in according to plan. Well, he did throw a “potentially” into that sentence.

So for better or worse, that’s the company’s future. Looking back to its past, though, I’ve heard from ex-Connecticut sources that the main former R&D building in Wallingford is now the subject of a demolition permit. You don’t get much more end-of-an-era than that. But as someone whose first industrial research site is roughly the location of a Home Depot parking lot (and has been for some years now), I can tell you that old lab buildings themselves aren’t as important as the memories you’ve made in them and the things you’ve learned.

51 comments on “Big Pharma Cuts, Current and Coming”

  1. farmafraud says:

    The usual (only seemingly) paradoxical pharma story…..we can’t come up with anything new, so we’re laying off R+D, that will allow us to keep some money for our “cash burn”, you know, executive salaries and all.

  2. mallam says:

    When a new head of R&D comes to GSK, all employees are accustomed to the coming rounds of cuts, hoping either to be in the saved group, or if wanting out then hoping there will be a good bonus upon termination. But what of new medicines? The stock price has been stagnant at best, and over the last 5 years has declined from just over $56 to less than $40 today. When a new effort can take a decade from discovery through development to registration, there will be more changes to “fix the problem” before we’ll see much coming out the back end of the pipeline. With a CEO that has had no practical career experience in pharmaceuticals, and now Hal Barron as head of R&D having high level visions but little to show from his previous appointment (Calico, an Alphabet-funded company that uses advanced technologies to increase understanding of lifespan biology), I’m not optimistic the company will become more productive any time soon.

    1. hn says:

      Hal Barron doesn’t seem to have much research experience. I guess you don’t need to know research to be head of research anymore.

      1. johnnyboy says:

        His yearly travel budget is $ 800 000. Yes, really 5 zeroes, just for travel (clearly, he needs 5-star hotels to accomodate his big big brain).

        That company is so f***ed.

        1. milkshake says:

          they can always rise the price of medications, to cover the cost of “innovation”

          The main problem is that the execs have all these perverse incentives to destroy the company to make the next quarterly earning report look a little sweeter. Their average tenure is shorter than the drug discovery-development-marketing cycle, so they will not be affected by the consequences of their actions on research. As long as they do dramatic reorganizations “that save money” its all good. They don’t even have to bother inventing new catchphrases, young bright consultants from McKinsey will have them neatly packaged. They just have to figure out who is centralizing his power and who needs to be reorganized out of existence in the upcoming leadership struggle, to adjust their presentation slides accordingly

      2. Calvin says:

        Even a cursory look into is background would tell you otherwise. He’s ex-Genetech and Calico. And seems to be well respected in the pharma/biotech/VC community. The vast majority of his career has been in pharma R&D. So I think he does have a decent amount of research experience. The exact opposite of his predecessor.

  3. tally ho says:

    Wherefore art thou Agilist?

    1. johnnyboy says:

      See below – new handle, same ‘enthusiasm’

  4. JB says:

    I started out a while ago as an associate scientist with a BS degree doing organic synthesis for a pharma company. The best piece of advice I ever got from experienced scientists in industry when I was young was NOT to go to grad school for a PhD in organic chemistry. The field was dying back then in the 00s and I was forewarned that everything was moving to biologics. I ended up going to grad school in a chemical biology related field and learned how to do tons of bio from gene cloning, to gene editing with CRISPR, to working with viruses and lots of immunology. I now do regulatory science, am out of the lab and couldn’t be happier. It is easy to hop between companies, do consulting gigs and jobs are always available for those knowledgeable in the risk assessment for gene and cell therapies. Plus, every company needs people with knowledge on how to deal with regulatory agencies and their paperwork. I’m still grateful to this day for my chemistry degree for providing me with a solid foundation in science, however, I definitely had to reassess my career path after the warning from chemists a long time ago. I honestly don’t know how chemists do it anymore these days in industry. The jobs are so unstable.

    1. HA (initials come before and after JB) says:

      Way to go JB.

      Many years ago, I gave similar advice to a nerdy intern that worked in my (chemistry) company: don’t go into chemistry, or even chemical engineering.

      He took my advice and switched to computer science. A few years later, he was making way more money than me, had a hot girlfriend who is now his wife, and then became founder and CEO of two mediocre tech companies that still made him do well. When we caught up, he thanked me profusely and bought me a beer for giving him the best advice of his life.

      As for me, I struggle with one gig to another with my PhD in chemistry. My colleagues around me whisper as morale tanks, job after job. Even my well-meaning friends ask me to send them my CV, thinking that I qualify for an entry level lab analyst job. It’s very demoralizing and depressing on a daily basis. Of my colleagues in chemistry who eschewed academia for industry, I’m actually one of the luckier ones. Others got whacked years earlier and have stayed unemployed or permanently “consultanted”.

      1. Chrispy says:

        This is such a familiar refrain. None of the chemists I knew who did chemistry 15 years ago are doing it today. Some jumped into patent law, and they have done OK but don’t really like the work. It’s a pity — I am more on the biology side (thank my lucky stars), but I have seen how a motivated, enthusiastic chemist can drive a program.

        1. ex-London Chemist says:

          I was part of a gang of four all doing our PhDs in the late eighties, and we all went into industry research (mix of pharma and agro)
          Now:
          One has just help decommission a nuclear power station
          One project manages the installation of underground rail systems in cities
          One sells fertiliser (mostly KNO3) to middle eastern and eastern countries
          And I (supposedly) still do research…..
          Go into industry if you want, but take the opportunity to learn lots of transferable skills…

    2. DrOcto says:

      Unless of course you don’t actually want a desk job, and do actually enjoy being in the lab and doing chemistry.

      1. CB says:

        This is my exact problem. Love science and being IN the lab…not handing out requests to outsource partners when I can do it.

  5. Anon says:

    As an ex-Merck employee, am just curious if the chemistry facilities at Rahway site has been demolished, yet? Waiting for some Home depot to show up there!

    1. Ex-merckie chemist club emc2 says:

      Don’t worry about Rahway. Merck has turned into the biggest construction company in NJ

  6. Dr. Manhattan says:

    Sorry to hear about the GSK folks. Hey management, good idea to emphasize those new areas; it’s not like everyone else is also there… (sarcasm intended). The entire focus of big pharmaceutical has shifted into those areas and away from a portfolio approach.

    ” the main former R&D building in Wallingford is now the subject of a demolition permit. You don’t get much more end-of-an-era than that. But as someone whose first industrial research site is roughly the location of a Home Depot parking lot (and has been for some years now), I can tell you that old lab buildings themselves aren’t as important as the memories you’ve made in them and the things you’ve learned”

    The Wallingford site opened in 1986, and the final wing was completed in the late 1990’s. Probably cost $150 million or so to build, and it was (and probably still is) state of the art in lab facilities. Now, it is demolished after being sold to investors for $5 million (yeah, I did not quote that price wrong). Moving everyone up to Cambridge where some form of vapors emitted into the air make everything work so much better.

    1. JB says:

      I doubt pharma execs care about how much they blow on facilities (costs that ultimately get passed onto consumers anyway). I remember when AstraZeneca spent hundreds of millions on building new facilities for R&D at their site in Delaware. It was shut down in less than 2 years and demolished if I recall correctly. Now I think all of what used to be in DE exists as MedImmune in a new facility down in Gaithersburg MD.

      1. Druid says:

        With my Upjohn experience, I came to the opinion that a new building was a sure sign of site closure. RPR in Dagenham too. I think that the disease of optimism means that unwarranted spending precedes a vicious overreaction leading to closure of the site and dismantling of promising research. Until CEO’s are replaced with a management team which can think ahead further than 5 years and see it through, this will not change.

    2. Isidore says:

      “Moving everyone up to Cambridge where some form of vapors emitted into the air make everything work so much better.”

      I recall a tongue-in-cheek comment Charles Weissmann, who first cloned alpha-interferon and was one of Biogen’s founders, made at a talk he gave at MIT, that one’s intelligence is inversely proportional to the square of one’s distance from Cambridge.

      1. Bub says:

        That’s pretty funny, considering Weissmann spent his twilight years in research at Scripps Florida.

    3. MoBio says:

      Yes that worked out well for Pfizer neuroscience–moved to Cambridge, shut down entirely now.

  7. nobody in particular says:

    The Novartis Institute for Biomedical Research (NIBR) opened in Cambridge in 2003 and has continued to expand since. Joining Novartis that year, I heard all the stories about the incredible cutting-edge research and new drugs that were going to flow from Cambridge being so close to all the smart people at MIT, Harvard, The Broad Institute, etc., etc. So, in the past 16 years I am hard pressed to think of one single thing that has come out of all that NIBR research conducted while inhaling those special Cambridge “vapors”. Anyone?

    1. HA says:

      No one ever gets fired for doing a deal with a hot biotech in Cambridge or with NIBR.

      That’s a phrase that’s adapted from “no one ever gets fired for hiring IBM.” Of course, we heard about Watson.

    2. Dr CHF says:

      come on!!! they managed to extend the patent life of Diovan by repackaging valsartan as Entresto didn’t they?

  8. FastPaced says:

    This story is merely conjecture at the moment but there is no doubt about Hal Barron’s determination to shake things up and reduce bureaucracy at GSK so some personnel changes are inevitable. In fact there has already been steady stream of incoming talent. GSK is now a very fast-paced environment where hiding behind process or self-marketing via buzz words and jumping on the latest band waggon (Big Data, Blockchain, etc. anyone?) has become an increasingly untenable career path. The new wave of marquee signings brought in by Emma and Hal are really beginning to make themselves felt and are shaking things up. This is of course ruffling some feathers and some middle management possibly feel threatened but this is what the company has been crying out for over the past 10 years.

    1. John Wayne says:

      Sounds like you guys are buying into the next hype.

      Also, great use of the word ‘marquee*.’ Unfortunately, it is probably an accurate description of the effect it will have – same building, new appearance.

      * a canopy projecting over the entrance to a theater, hotel, or other building

    2. BaddeleyRun says:

      “hiding behind process”, and jumping on band wagons: getting rid of all of those types would probably reduce RD headcount by 50%

    3. johnnyboy says:

      He’s baaaaaack !!!!

      1. fBRAD says:

        “fast-paced” a euphemism for too few trying to do to much! As for “bandwagons” @GSK, is it a case of replacing one type with another. It’s true that some prominent Blockchain BS merchants have departed as has Baloney but now we have an AI/Big Data explosion. Perhaps AI is the future, not my field so I cannot say but it looks suspiciously like another “bandwagon” to me.

        1. Whoneedsscience? says:

          If you look on their website, GSK has been hiring loads of AI/ML coders to fill new positions with vacuous, hype-loaded job descriptions at inflated grades. No knowledge about drugs is needed, because the successful applicant will “analyze business needs and produce detailed architectures that meet strategic objectives”.

          Still, at least they aren’t “hiding behind process or self-marketing via buzz words and jumping on the latest band waggon”, eh FastPaced?

          1. fBRAD says:

            Very true “whoneedsscience”. I saw some of those ML/AI jobs and was tempted to enrol on Coursera MOOC and then apply myself. Nice grade and salary if you could live with all the BS and waffle!

    4. Nick K says:

      Poor old Agilist is back, and still laughed at by everybody.

    5. Chrispy says:

      We’ve missed you, Agilist.

      Thanks for weighing in.

    6. Nick K says:

      Funny how Agilist never talks about all the previous reorganizations at GSK. What, didn’t they work?!

      1. fBRAD says:

        He/she, i.e. “Agilist” (or whatever is the current Nome de Plume) is not alone in this. Generally, GSK suffers from corporate amnesia where bad deals (sirtis, et al) and botched re-orgs are erased from the record. His Panglossian view of the current state of the company is shared, at least in public, by most upper management as well as by those aspiring to upper management. Any reminders of past clusterfucks are extremely unwelcome and are likely to mark you out as being “negative” or “not a team player”. Due lip service is paid to openness and transparency but it’s very much a brown-nose, yes-man culture that prevails.

        1. ex-London Chemist says:

          I thought that was how ALL organisations worked?

          1. fBRAD says:

            Different companies have different cultures. Some companies reward certain behaviours more than others. This piece from the BBC very much echoed my experience at GSK to a much greater degree than anything I have experienced in various other companies:
            https://www.bbc.co.uk/news/education-46608818#

  9. An Old Chemist says:

    The old GSK labs in the RTP area were demolished and a sort of recreation park now exists at that place. The pictures are posted at the following URL: June, 2018)

    https://www.bizjournals.com/triangle/news/2018/06/15/treehouse-to-roller-rink-a-look-at-parmer-rtps-80m.html?ana=yahoo&yptr=yahoo

    1. AnonRTP says:

      No the old RTP labs have not been demolished. The whole site was sold to a commercial landlord who has them on the market for lease. The new construction is either renovating buildings or adding new in previously wooded areas. Overall the sale has been a positive for the area as previously GSK was allowing the buildings to go unused and decay.

  10. Magrinho says:

    FastPaced is a GSK PR hack and has shown up before in other guises when the topic of GSK comes up. “Changes are coming and middle mgmt feels threatened” is an effective but misleading and awful narrative for getting rid of mid-career, experienced, talented scientists.

    If you want to be honest, just say that GSK is now less committed to small-molecule therapeutics and we are sorry that translates into job losses.

    OK – that hurts but at least it’s true.

  11. oldnuke says:

    I was going down the chemistry route (my late Dad was an entomologist at Dupont). He warned me not to go to Dupont, that the sucking sound in Wilmington was their R&D going down the tubes. I listened to him and changed to comp sci and networks. I’ve worked for the power company in Wilmington, coming up on 42 years. Sorry to say, Dad was right (in a lot of ways) and watching them dismember the Experimental Station and Central Research is painful to watch.

    May the DowDupont management burn in hell.

    1. Hap says:

      I think Satan would be afraid they’d take over…and then where would his job go?

      I keep hearing that we can’t do things the same old way, that something has to change in the way people do drug discovery. What I don’t understand is how anyone’s going to find that if they keep getting rid of the people that actually do it. Magic? Tablets tossed from the sky?

      As long as people can make money rearranging deck chairs, why would they do anything else?

  12. ChairmanMao says:

    So that’s what chemists are– Deck Chairs.

    That’s what industry and your CEO thinks of highly trained scientists and chemists in particular. You are worthless scum that can be treated and abused by the powerful, nebulous and greedy- to be dispensed with in a moment’s notice and at will, according to most contracts.

    How many of you are capable of rising against such abuse and tyranny?
    Not that many as you are in survival mode most of the time.

  13. chewedupspitout says:

    The dirty truth, that few “esteemed” “doctors” with PhD’s fail to get, is that big pharma management doesn’t have a lot of faith in their research efforts to begin with.

    There is an old saying that research in big pharma is just for show

    When you look at the way they slash and burn from this perspective it’s obvious what’s going on.

  14. old gsker says:

    Looking like Agilist has been replaced by FastPaced.

  15. Denise says:

    The best advice I received from senior chemists in my group was to not get my advanced degree in chemistry and to leave the lab in 5 years. I loved working in the lab; that was in 1987 and the writing was on the wall back then! Earned my MBA, moved into clinical development and have been able to pave a very nice career path in pharma; still in high demand.

    1. Me says:

      Likewise.

      Although I did do my PhD and spent 9 yrs in med. chem. Including at GSK.

      I now earn 3x more, work 3x less and am >3x happier in my career!

  16. EternalPostdoc says:

    I came for the article and stayed for the angry comments. I really would have liked a bench job but no thank you after reading this. Being an organic chemist in the western world post-academia must feel like being part of a dying, ancient trade.

    1. nobody in particular says:

      I would be hard pressed to recommend being any type of scientist in large pharma these days. The bench is what draws most of the people I know (myself included) to research jobs, but you had better be flexible, add new experiences, and skill sets to allow you to move beyond the bench (sigh…) — if you want to remain employed. Definitely, work in a startup, and always work to have more influence over the decision-making process wherever your path may lead. Good luck and keep evolving (or die).

    2. anon says:

      “I came for the article and stayed for the angry comments.”

      If email sigs were still a thing, dibs on that.

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