In its effort, stated in June, to trim 8,000 employees from its roster of more than 100,000, Novartis isn’t wasting time.
In August, the Swiss company revealed its plan to close down a plant in Wilson, North Carolina, leaving 246 employees out of work. Now, less than three months later, Novartis is shuttering a gene therapy manufacturing facility near Chicago.
Closure of the site in Libertyville, Illinois, will force 275 employees out of their jobs, according to a filing with the state. But Novartis' layoffs aren't the only ones in the works, as a pair of smaller drugmakers are also making new cuts.
Novartis' action comes following a “comprehensive manufacturing site network evaluation,” a company spokesperson said in an emailed statement. The facility will remain operational through 2023, with some activities phased out during the year, the company said.
The Illinois plant’s sole purpose is to produce Zolgensma. All operations related to the production of the gene therapy will be consolidated at another Novartis plant in Durham, North Carolina, which also currently produces Zolgensma, the spokesperson said.
The company is proving 90-day notification of layoffs with severance packages.
“Gene therapies and advanced platforms are still expected to play an increasingly important role in the years and decades to come at Novartis,” Novartis' spokesperson said. “However, our most recent network assessment, along with clarified demand expectations and higher yields through process improvements, show that we can meet current and anticipated global demand for Zolgensma and future gene therapies through a single site.”
Late last month, during its quarterly earnings presentation, Novartis said that sales for Zolgensma had dropped 13% to $319 million (PDF). The haul came in 20% below Wall Street’s expectations and rewound the drug to the same level of sales it had in early 2021.
Novartis isn’t the only company in the industry executing layoffs. In a move that will take effect Jan. 13, Sumitomo will lay off 360 from its site in Marlborough, Massachusetts, according to a Worker Adjustment and Retraining Act notice filed last week.
In addition, in its third-quarter earnings presentation, Valneva said Thursday that it will reduce its workforce by 20% to 25%. The move is part of a “reshape strategy” and “resizing” of operations, the company said.
The company employed around 750 people worldwide as of earlier this year, so the cuts will affect somewhere around 175 staffers.
Valneva’s layoffs will still leave the company with approximately 25% more employees than it had before the pandemic, it explained, and will result in annual savings of 12 million euros ($12 million).