Gilead combines shared services into one North Carolina hub, aiming for 'cost and time zone advantages'

Gilead
Gilead's new business services location in North Carolina consolidates "critical support" and realizing "cost and time zone advantages." (Gilead China)

Gilead Sciences is building a new business services center in North Carolina in a pharma-familiar cost efficiency move.

The Gilead Business Services center, set to open later this year in the Research Triangle Park region, will house human resources, finance and information teams for North America. The company is investing up to $5 million in the project, North Carolina officials said, and the center will employ about 275 people, mostly new hires, by the time it's fully operational in two years.

The center “is an important step forward for the company, as it creates a dedicated hub for critical support services in a location that will allow us to realize certain cost and time zone advantages,” Gilead said in a press release. The company headquarters is in Foster City, California.

RELATED: Novartis, shrinking 19% of its workforce, faces big challenges with thinned ranks

A slate of Big Pharma companies have taken the same approach—not to mention a slew of companies in other industries as well. In 2014, Novartis created a business services unit with hubs around the world, cutting $3 billion in costs in the process.

Johnson & Johnson, Bristol Myers Squibb and Amgen have set up similar hubs, all in the Tampa Bay area in Florida. Amgen's is the most recent; it opened in 2018.

Unfortunately, business services hubs can themselves end up as targets for job cuts. When Novartis CEO Vas Narasimhan, M.D., rolled out plans for a 19% staff reduction, 700 jobs were cut in a the business services unit, and Bristol Myers cut some jobs at its "capability center" in South Florida in 2019.