Growth Amid Pharma Cutbacks

BUCKING A DRUG-industry-wide trend toward cutbacks and consolidation, Gilead Sciences is expanding in both size and headcount. The biopharmaceutical company plans to add about 1,900 jobs and double office and lab facilities at its Foster City, Calif., headquarters over the next 10 years.

Gilead isn't releasing details of the plan, but the company confirms that it will likely tear down some existing office and R&D space and build up to four new labs that will also house a pilot plant. Employment at its sites in Seattle and in Durham, N.C., will also increase over the next 10 years. The company currently has some 3,200 employees.

Gilead's sales are on track to reach $5 billion this year, up from $868 million just five years ago, and the company clearly expects its new drug pipeline to continue propelling growth. It has launched at least one new drug or combination treatment per year since 1999, is awaiting regulatory approval for an inhaled antibiotic to treat cystic fibrosis (see page 15), and has two products—an HIV drug and a hypertension treatment—in late-stage patient trials.

Yet that brisk pace of growth is an anomaly these days as pharmaceutical companies big and small struggle to be productive. Most drug firms are eliminating, rather than adding, jobs in an attempt to lower costs and become more efficient.

Last week, Belgian biopharmaceutical firm UCB unveiled plans to shed 2,000 jobs across its global operations as it prepares for generic competition to its allergy drug Zyrtec and its epilepsy drug Keppra, which will lose patent protection next year. Patent expirations create challenging times, UCB's CEO Roch Doliveux says. Although the company is poised to launch several new products—a Crohn's disease drug in the U.S. and drugs for epilepsy and restless legs syndrome in Europe—it is still a challenge to stay competitive. "The time is now to take action to shape UCB for the future and become a specialist company focused on successfully delivering our new medicines to patients," Doliveux says.

Abbott Laboratories also announced an overhaul, saying it will pare manufacturing worldwide and cut 1,000 jobs in its diagnostics division over the next four years. The measures will tally up to $150 million in annual savings.