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Swiss Drug Maker Roche Cuts 1,000 US Jobs by Closing New Jersey Plant

Tuesday, 26 June 2012 01:28 PM

Roche announced an overhaul of its research activities, including the closure of a U.S. plant, 1,000 job cuts and the exit of its drug research chief.

The Swiss drug company said on Tuesday Jean-Jacques Garaud, its head of pharmaceutical research, will leave the company at the end of this week. He will be replaced by Mike Burgess, head of cancer drugs.

Roche didn't give a reason for the management changes. Last month, the company said it would end research on dalcetrapib, one of several new treatments from drug firms to help boost levels of "good" high-density cholesterol (HDL), a move which sent the shares sharply lower.

Last September, Garaud said the experimental drug, which raised HDL substantially in a Phase II trial, had the potential to generate annual sales of $10 billion.

Garaud's secretary said on Tuesday he was travelling and unavailable for comment.

Roche's research overhaul will see a Nutley, NJ-based plant closed and its activities moved to Germany and Switzerland, an attempt to clamp down on its drug development costs as research on experimental drugs is on the rise.

"The planned consolidation of our research and early development organization and the refocusing of research and development activities in Switzerland and Germany will free up resources that we can invest in these promising clinical programs while also increasing our overall efficiency," Roche Chief Executive Severin Schwan said in a statement.

The move allows Roche to keep its research and drug development costs largely unchanged, despite an increase in clinical research projects in the last 18 months, Schwan said.

Roche said costs to close the Nutley plant will be communicated on July 26, when it reports for the first six months of the year. Roche backed its 2012 financial outlook in the statement.

The company said it is currently seeking a location on the U.S. east coast to open a trial and development centre, expected to employ 240 people. Investment into research by San Francisco, CA-based Genentech, a Roche subsidiary, won't be affected by the overhaul, Roche said.

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Tuesday, 26 June 2012 01:28 PM
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