Dive Brief:
- Genentech will be laying off 223 employees located in its South San Francisco, California, headquarters beginning at the end of this month, the company disclosed in a recent state filing.
- The effective dates for the layoffs will run from Aug. 31 into November, a company spokesperson told BioPharma Dive in an email.
- The layoffs, first reported by FiercePharma on Wednesday, were documented in a Worker Adjustment and Retraining Notification (WARN) post by the State of California's Employment Development Department.
Dive Insight:
Biosimilar competition is heading toward Roche for some of its top-selling cancer drugs Rituxan (rituximab), Herceptin (trastuzumab) and Avastin (bevacizumab). Amid those concerns, the Swiss pharma has been enacting hundreds of layoffs.
"We have been evaluating some of our operations to ensure we remain well-positioned to meet the needs of patients today and deliver on our pipeline of new medicines in the future," the company said in an emailed statement. "As a result of this process, we have made the difficult decision to eliminate some positions."
The 223 layoffs come only months after Genentech announced in November it would be cutting 130 positions from a plant in California and 235 from one in Europe.
These new layoffs will be across various departments but all will be in South San Francisco, according to a company spokesperson.
Roche has a complex calculus to consider in weighing impending patent cliffs against the profit-driving potential of new products such as Ocrevus (ocrelizumab), a multiple sclerosis (M.S.) treatment, and Hemlibra (emicizumab), a hemophilia A drug.
The Food and Drug Administration granted breakthrough therapy designation for Hemlibra in April to consider patients without factor VIII inhibitors. The drug has quickly became a leader in its area.
Ocrevus (ocrelizumab) has been FDA-approved for M.S. for more than a year now has also been a huge success for Roche. BioPharma Dive named it the Most Impressive Drug Launch for last year.
In its earnings report last month, the company highlighted Ocrevus as a key driver of revenue growth in the U.S. and Europe. For the first six months of 2018, it posted just over $1 billion in global sales.
But even those developments aren't enough to completely offset the steepness of Roche's impending patent cliffs. Rituxan (rituximab) already faces biosimilar competition in Europe. And Novartis has already tried to launch a copycat in the U.S., but received a complete response letter in May.
Even without U.S. biosimilar competition, Rituxan saw global revenue shrink by 9% in the first half of 2018. In Europe, Rituxan sales decreased 47% year over year in that period. The revenue still remains massive, though, at over $3.4 billion in sales for the first six months of 2018.
Fellow cancer drugs Herceptin and Avastin also posted north of $3 billion each in sales for the first half of the year. Both could see biosimilar competition sooner than later.
A company spokesperson said Genentech will provide financial benefits, extended healthcare coverage and career coaching to the employees let go.
Editor's note: This article has been updated to reflect Hemlibra's breakthrough therapy designation for patients without factor VIII inhibitors.
