Biogen Idec Chief Aims to Make Firm More Like Biotech and Less Like Pharma with Restructuring Plan
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infection called multifocal leukoencephalopathy (PML) in patients on natalizumab and its impact on sales of the drug. “With troubling Tysabri trends out of [third quarter 2010] earnings combined with real risk to [Biogen's] MS franchise from an oral MS therapy, even with today’s meaningful refocus on its core strengths, we think the road ahead is more difficult for [the company],” Christopher Raymond, a biotech analyst for Robert W. Baird in Chicago, wrote in a note to investors yesterday. Biogen has confirmed 70 cases of PML, according to Raymond.
In interviews with some of Massachusetts’ biotech leaders, the consensus opinion about Biogen’s restructuring plan seemed to be that it was not necessarily bad news for the Bay State’s biotech community. (As Xconomy reported yesterday, the company is cutting about 80 jobs in the commonwealth, while it is axing the majority of its 300 to 350 workers in San Diego.) Yet Biogen’s cuts follow the announcements in September of major layoffs at a couple of other important local biotech companies—Genzyme (NASDAQ:GENZ) and Alnylam Pharmaceuticals (NASDAQ:ALNM).
“The really important story in this is that as large pharma and biotech companies make adjustments in their work forces, they are choosing to retain a significant presence in Massachusetts,” said Susan Windham-Bannister, president and CEO of the Massachusetts Life Sciences Center, a quasi-public agency in Waltham, MA.
Windham-Bannister noted that both large drug companies and smaller biotechs are investing in the state because of its strong R&D capabilities. Switzerland-based Novartis, for example, announced last month that it planned to invest $600 million in its expansion in Cambridge and add 200 to 300 jobs there over the next five years. And the French drug giant Sanofi-Aventis is planning to invest $65 million in an expansion in Cambridge and boost its local work force with 300 new hires in the coming years.
Bob Coughlin, the chief executive of the Massachusetts Biotechnology Council, said yesterday that large drug researchers such as Biogen would continue to invest in the Bay State to stay close to innovative science that will feed their R&D pipelines for years to come. Biopharmaceutical jobs in the state increased 60 percent from 29,046 in 2000 to 46,553 in 2009, according to Coughlin’s Cambridge-based industry group.
Biogen will employ roughly 1,900 workers in Massachusetts after the 4-percent reduction in its employee base here. (The firm expects to have 4,275 workers globally after its cuts are completed). Scangos said that the company will remain headquartered in the state and it’s an important part of its business. “There’s a potential to grow here in the future,” the CEO said.