It's been rumored for months, and now it's official: Biogen Idec ($BIIB) is slashing costs. The company will cut 13 percent of its workforce, or some 650 jobs, and shut down facilities as it revamps itself to improve efficiency, cut bureaucracy and refocus its efforts on neurology, including its two top-selling multiple sclerosis drugs Tysabri and Avonex.
In addition to cutting jobs, Biogen will revamp its management approach to improve "crispness and timeliness of decision making and execution," the company said in a statement. Business development, venture development and corporate strategy will all be combined into one Corporate Development Group; the company is looking for the right person to run the combined operation.
More cost savings will come via the shutdown of Biogen's San Diego facility--which has been part of Biogen since it bought Idec Pharmaceuticals in 2006--and consolidation of two Massachusetts operations with existing facilities in Cambridge and Weston. R&D will be streamlined as well.
CEO George Scangos (photo)--who's been evaluating operations since he took over last June--said in a statement that, in addition to saving money from these moves, the company will be better off overall. "Biogen Idec will be leaner, more nimble and more decisive," Scangos said. "Importantly, the initiatives announced today will save more than $300 million annually and will position Biogen Idec to accomplish great things in the future."