Biogen starts layoff round as the Aduhelm maker struggles with Alzheimer's rollout

Biogen’s $500 million restructuring plan is starting to take a toll on its employees.

The company has started sending out layoff letters to some employees in the U.S., Biogen said in a statement to Fierce Pharma.

Biogen isn’t sharing any details on the number of affected staffers; a spokesperson said the number is fluctuating, as some people have resigned while others are eligible to apply for other positions.

“These changes will help the company remain flexible, so additional investments can be made in our pipeline and other strategic initiatives,” Biogen said of the layoffs in a statement. “We appreciate the contributions of our departing colleagues, who will be eligible for severance and support services as they transition out of the company.”

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The layoffs are part of an overhaul Biogen unveiled in December aimed at saving $500 million in annual costs. A few days before that, Stat reported that the company was eyeing $750 million in savings and could lay off as many as 1,000 staffers.

Biogen has already laid off more than 100 employees, including two-thirds of the Alzheimer’s commercial team and all leaders within the Alzheimer’s field sales force, Endpoints News reports, citing a senior company exec.

The restructuring was triggered by the bad reception of Alzheimer’s disease drug, Aduhelm, thanks to controversies around the first-in-class antibody’s efficacy and safety profile plus Biogen’s reportedly questionable interactions with the FDA in the run up to the approval. Aduhelm's fourth-quarter sales came in at just $1 million, hardly a meaningful improvement from about $300,000 in the third quarter of 2021.

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The drug’s market potential doesn’t look like it's on the mend, what with a restrictive draft coverage decision from the Centers for Medicare & Medicaid Services. In a measure that would significantly limit the scope of Aduhelm coverage, the U.S. agency is asking that patients be enrolled in an approved clinical trial to be eligible for reimbursement.

If that draft policy goes through as is, Biogen’s sales and marketing activities around Aduhelm will be limited for years. Some commercial insurers have indicated that they would evaluate their own stance on Aduhelm based on the CMS plan.

Biogen and partner Eisai are rallying support, calling for wider CMS coverage that would mimic the patient population in Aduhelm’s two phase 3 trials. However, comments the CMS has received so far are mostly in support of the agency’s current proposal.