Biogen Inc said on Tuesday it expects to slash about 1,000 jobs, or about 11% of its workforce, to save costs as the company ramps up the launch of a new Alzheimer’s disease drug in efforts to return to growth.
Investors have pinned their hopes on Leqembi, which Biogen sells with Eisai, to power growth as money spinner multiple sclerosis and spinal muscular atrophy (SMA) treatments face fierce competition from cheaper versions and rival drugs.
“Biogen’s business is in transition,” CEO Christopher Viehbacher said in a statement.
“While we will be making significant investments in our newly prioritized pipeline and new product launches, we will also need to invest less in other areas,” he added.
The company had said in April it would pause or discontinue at least four studies of experimental drugs to focus on more lucrative options including the Leqembi launch and trim costs.
Biogen expects the new cost-cutting program to reduce about $700 million in net operating expenses by 2025.
The company had 8,725 employees worldwide, as of the end of last year.
In the second quarter, Biogen earned $4.02 per share on an adjusted basis, compared with estimates of $3.77.
Drugs including SMA treatment Spinraza and multiple sclerosis therapy Avonex beat analysts’ estimates in the three months ended June.
Sales of Spinraza rose slightly to $437 million, above estimates of $434.79 million, according to Refinitiv data, while Avonex sales of $220.3 million beat expectation of $214.96 million.
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