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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: derekb.lowe@gmail.com Twitter: Dereklowe

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August 30, 2010

Roche: Layoffs, or Rumors?

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Posted by Derek

A Swiss newspaper reported over the weekend that Roche is planning large cuts, across much of their multinational organization. Here's the original article, for those of you who read German.

Looking it over, it seems to depend on the word of one Roche insider - or, more accurately, someone the newspaper describes as having the "best contacts" there. This person says that a decision will be made this week on cuts in research and other parts of the organization, and that Roche has been trying for some time to work out a large cost-cutting program.

The company denies any specific plans, but makes the appropriate noises about always looking for ways to do things more efficiently. Anyone heard anything else?

Comments (41) + TrackBacks (0) | Category: Business and Markets


COMMENTS

1. quintus on August 30, 2010 9:55 AM writes...

Would not surprise me at all. Novartis is doing the same thing but with less publicity. I shall ask my Roche contacts.

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2. David P on August 30, 2010 10:07 AM writes...

I see Fierce Pharma reporting the same thing, refering to a Swiss newspaper.

Roche are denying it though.

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3. Pharmaheretic on August 30, 2010 11:45 AM writes...

Layoffs are in fashion.. and most people make decisions based on fashion.

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4. Great Molecular Crapshoot on August 30, 2010 2:29 PM writes...

Switzerland must be one of the most expensive countries in which to do drug discovery research. Roche is a bit unusual in that a couple of families own half the shares and I believe that Novartis also has a significant shareholding. A lot of drug discovery people in Basel are ex-pats so downsizing will have a lower political cost than if the work force was all Swiss.

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5. dvrvm on August 30, 2010 3:53 PM writes...

@4, I don't agree with you... The political cost of downsizing Swiss R&D facilities is enormous for both Roche and Novartis, because they basically have been blackmailing Switzerland for years to keep up our restrictive parallel import laws in spite of the fact that allowing parallel imports would dramatically lower healthcare cost in Switzerland. There is the always-impending threat of them leaving Switzerland, which is not only a threat to the domestic science job market but more importantly to Swiss economy as a whole, since pharma and especially Roche/Novartis are considered important pillars of Swiss economy.

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6. anon on August 30, 2010 6:38 PM writes...

don't agree the socail cost is great, they are governed by the social contract. they don't do the out the door quick routine like in the US

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7. anon on August 30, 2010 6:38 PM writes...

don't agree the socail cost is great, they are governed by the social contract. they don't do the out the door quick routine like in the US

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8. Anonymous BMS Researcher on August 30, 2010 7:38 PM writes...

Reuters has official denials, so I am remembering the old political axiom, "never believe a rumor until it has been officially denied."

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9. JoesephPeabody on August 30, 2010 9:57 PM writes...

The Swiss have a long tradition of kicking out their foreign employees when things get rough. I worked there for six years.

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10. Great Molecular Crapshoot on August 31, 2010 3:06 AM writes...

I didn't state that the political cost would be insignificant but merely that it would be less than if the R&D staff were all Swiss.

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11. Anonymous on August 31, 2010 7:13 AM writes...

I am not surprised to hear that Novartis is doing this also. With the shuffle up top and the generation of new director positions, it was just a matter of time. I know quite a few positions that have already been eliminated rather than be filled.

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12. quintus on August 31, 2010 11:31 AM writes...

@Anon; you are wrong, completely wrong, they do very quick out the door, faster than the US. I know.
Novartis and Roche are in effect US companies in their thinking and doing.

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13. anon on August 31, 2010 12:09 PM writes...

quintus- not in the Schweiz. Know both sides of the pond. Overthere they don't do the call, meeting and then gone routine.

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14. Quintus on August 31, 2010 1:17 PM writes...

@Anon, yes they do, I worked for them for 30 years, saw it many times, especially since Novartis was grounded.

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15. anon on August 31, 2010 2:27 PM writes...

in Basel they were handled with more civility- longer 'grace' period and benefits. It was interesting after they aquired Syntex that they cut the 'benefits' so that Gerber could not pay out so much. For the '98 siege, the call, the meeting and off site for the exit paperwork

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16. Great Molecular Crapshoot on August 31, 2010 3:01 PM writes...

I had the impression that getting culled by Roche or Novartis was a quick process. Worryingly for those in rented accommodation, leases in Switzerland are sometimes long term (e.g 3++ years).

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17. Anonymous on August 31, 2010 6:24 PM writes...

My Roche contact confirmed that cuts are coming...

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18. Great Moleculat Crapshoot on September 1, 2010 4:04 AM writes...

Perhaps Genentech will prove to be one meal too many. Time will tell.

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19. anon on September 1, 2010 6:21 AM writes...

in the end- bonuses will go to a few for correct sizing and a lot of good people will loose doing something they love to do (and afterwards, the survivors will get the traditional pep talk- we can do it, we're leaner, more focused.....)

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20. ash on September 1, 2010 6:42 AM writes...

@16, Getting culled at Roche or Novartis takes 3 months, for most employees, but 6 months if the employee has been there 10 or 15 years or more. They also get one year 80% of their salary ( from teh state)

I wouldn't worry about their apratment leases, you can transfere leases no a new party easily here ( your landlord can't stop you, or he can say no but then your lease is up) and housing is short at the moment.

My wife," low level Roche employee" has heard nothing.

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21. quintus on September 1, 2010 9:12 AM writes...

@Ash, correct what you say, but you don't usually have to work the 6 months you are free to find another job or even do nothing. I won't comment on the unemployment benefit.

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22. Great Molecular Crapshoot on September 1, 2010 10:11 AM writes...

@Ash, The Swiss Government paying redundant ex-pats 80% of salary does sound unbelievably generous. Are you sure? Are there cut-offs? I can't imagine the Swiss willingly coughing up 80% of a redundant investment banker's salary.

I know that supply of housing is tight in and round Basel. However, having responsibility for a long lease in Switzerland while working in another country is not going to be fun, especially if where you've moved to treats the rent received as taxable income.

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23. quintus on September 1, 2010 11:14 AM writes...

@ 22: Yes, you can qualify for up to 80% of your insured salary. It comes as unemployment benefit, but what you have to do to get it is beyond the scope of this Blog.

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24. Lu on September 1, 2010 5:26 PM writes...

It's sad but I've never encountered a rumor about layoffs which was not true.

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25. omar on September 2, 2010 10:01 PM writes...

talking of layoffs's isnt sanofi-aventis having a few these days? Gotta get all that money to get genzyme packed up.

There are even rumors of trumped up reasons and terminations. Middle managers are having a field day settling old scores. Everyone's buys a**kissing to do any real work, soon CV will have no choice but buy biotechs. That's okay, more the deals, more pie for everyone involved.

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26. ash on September 3, 2010 4:34 AM writes...

The big announcement that came this week is hat they will make an announcement this year on restructuring.

Or so I have read in the papers.

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27. ash on September 3, 2010 6:43 AM writes...


@22,

Yes there are cutoffs, but you are already wealthy ( or at least you should have nothing to worry about) if they apply to you.

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28. Confused on September 4, 2010 3:28 PM writes...

I currently have a job, but I'm still getting email notifications about job opportunities at Roche. The requirements sound kind of generic ("ideal candidate should have PhD in a life science") and the job location isn't really specified ("United States"). I don't get it, if Roche/Genentech is supposed to undergo major restructuring, why the hell is its HR still sending out postings?

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29. Anonymous on September 4, 2010 8:49 PM writes...

I wouldn't focus too much on Roche at this time. What about the announcements from Astrazeneca, Pfizer and Merck about layoffs last year. Massive layoffs targeting >10,000 and site closures. Much of that STILL HASN'T HAPPENED. GSK is also purging. Let's get real, we still haven't seen the ramifications of the Merck / schering merger and what that means for jobs in NJ &n PA. All we've heard is that they are closing Merck Frosst and a few others. There are many layoffs in the works that are way ahead of Roche.

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30. Anon on September 5, 2010 8:15 AM writes...

#29 - Can you provide any further elaboration of the "GSK is also purging" comment? Do you think that there's going to be another round after the 3 year business cycle is over (next year)? Our DPU head just held a meeting last week saying that we were behind in the promised numbers (CS, etc. etc.) and need to play catch up to try to meet the assigned numbers. I'm practially living here (at work now), and it still isn't enough to please the managers. Our DPU is management top-heavy, with not enough people working in the lab, and trying to make up the difference with students only seems to work well if there is enough "easy" work for them to do. Trying to give a student harder work when they are not ready for it leads to the student being very frustrated (and taking it out on their immediate manager, in terms of alot of time and materials spent and alot of complaining), and nothing produced for the company (net loss for the company, actually). Of course, our managers don't want to hear this.

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31. @30 Anon on September 5, 2010 3:11 PM writes...

OMG, why are you working on a Sunday?! Are you the only one in lab, or are your colleagues also slaving away? I thought Big Pharma was not meant to be "Grad School Musical Part 2". Can HR do anything to mitigate your situation, or are the managers threatening to reassign your job to the Shanghai branch?

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32. MoreBadNews on September 6, 2010 2:15 AM writes...

#30, "Our DPU is management top-heavy", a very common complaint across GSK. Not alone are there too many managers, they're also generally very mediocre both as scientists and as managers. Many areas of clin dev are suffering severe over-stretch and inept management. This added to continual rumors of more closures and massive lay-offs is doing nothing for morale. Time for a career change I fear!

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33. ash on September 6, 2010 5:34 AM writes...

@28, there is currently a headcount freeze ( for some years now), and a headcount reduction is coming in the future, but ther is still people leaving the company for personal reasons. These people have to be replaced.

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34. anon on September 6, 2010 12:15 PM writes...

31 - I saw other people around as well. It is starting to feel more like "Grad School Musical Part 2," since we are getting closer to the end of our business cycle. There are alot of well qualified but unemployed scientists in the job market now due to unfortunate circumstances beyond their control, so I know that I'm fortunate to have a job.

The march Eastward is always continuing, and I don't see it slowing anytime soon. Even if the cost of doing reseach in China would match the cost in Eu or US, alot of companies have invested so heavily in China now that the jobs would not return here. The Chinese also don't complain, at least not in English.

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35. anon on September 8, 2010 1:22 AM writes...

@ 28...if you are getting e-mail notifications about other job postings within the org, that's usually a bad sign. Your department WILL be laying off people or shuttin' it down. Forget what management tells ya. Time to start Plan B.

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36. JMB on September 8, 2010 12:34 PM writes...

There was supposed to be a company-wide meeting today. Any news?

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37. employee on October 11, 2010 9:16 PM writes...

I work there they have a significant "operational excellence project" looking at improvong efficacy. if you ask me the layoffs are coming. they say they'll announce their findings by the end of this year and will try to implement it early next year

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38. warhorse on October 20, 2010 2:41 PM writes...

Contractors are being let go before contracts are up.

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39. a man that knows on November 15, 2010 7:36 PM writes...

Cuts begin tomorrow, Nov 16 at 8am to the sales staff and before noon to the management staff. Rumor has a 70% reduction. Can you imagine being the manager to call and give a sales rep the bad news then someone calls you the manager with your bad news..

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40. Worker bee on November 17, 2010 1:27 AM writes...

Rumor no longer. 6% reduction in Roche global workforce.

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41. Stanford Munt on August 18, 2012 9:43 AM writes...

When I initially commented I clicked the "Notify me when new comments are added" checkbox and now each time a comment is added I get several emails with the same comment. Is there any way you can remove people from that service? Many thanks!

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