Reuters reported this afternoon that the Swiss pharmaceutical company Roche will shut down its plant in Nutley as part of a research overhaul, resulting in 1,000 job cuts.
The plant’s activities will be moved to Switzerland and Germany, in an attempt to reduce drug development costs on experimental research.
“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.
“Workers were notified today at a town hall meeting,” said Roche’s Nutley-based Director of Public Affairs, Darien E. Wilson. “We’re notifing everyone on the site by August of what their time frames for transition will be.”
Roche is seeking to open a trial and development center on the east coast. About 240 workers from Nutley will be offered positions at the new center, according to Wilson. The Translational Clinical Research Center will support trials and early development programs. There is currently no date set for its opening, but it is projected to open in January 2013.
Here is an excerpt from CEO Severin Schwan’s official statement:
The first one was the overall evaluation of our portfolio and our assessment of the prospects for success with a number of compounds in Nutley, in particular in the area of inflammation, but also in other parts of our portfolio. In spite of the progress made on a number of fronts, the output was not enough relative to the resources we have been allocating to Nutley and compared with more promising projects at other locations.
The other reason is the specific cost structure in Nutley. Because Nutley was once a much larger operation housing our North American Pharma headquarters and its full range of activities, the 127-acre site, as a pRED facility, has been burdened with an oversized infrastructure. Although tremendous efforts have been made to cut costs, regrettably, it was not enough. Nutley does not have the critical mass as a single-purpose research site to justify the infrastructure cost, and pRED as a whole can no longer afford to maintain important support functions such as chemistry and non-clinical safety at both Nutley and our sites in Europe.
Thus the pRED consolidation comes with a bitter price: the loss of approximately 1,000 jobs worldwide, most of them in Nutley, where operations will cease by the end of 2013. On behalf of myself, and of Roche, I pledge to treat those of you who are leaving the company with dignity, compassion and respect.
Wilson told Baristanet in November 2010 that the overhaul program entitled “Operation Excellence” would result in the loss of 900 positions, mainly in Product Development. The drug company’s global workforce was reduced by 4,800, with a total of 6,300 affected by the combination of planned job reductions and transfers.