Novartis says it will cut more than 2,000 jobs to streamline its global manufacturing and service operations and boost its bottom line.
The move will hurt Swiss workers the most. Novartis plans to cut about 1,500 manufacturing jobs in Switzerland by 2022. It will also eliminate up to 700 business service positions in the country in favor of cheaper labor in Czech Republic, India, Ireland, Malaysia, and Mexico. Another 400 jobs will be cut when a plant that produces drugs for hypertension, breast cancer, and other conditions closes in Grimsby, England, by the end of 2020.
Vas Narasimhan, who became Novartis’ CEO in February, says the cuts help the firm shift focus toward personalized medicines and away from high-volume drugs. As such, Novartis will create 450 new Swiss jobs for cell and gene therapy manufacturing. Kymriah, the company’s new CAR T-cell therapy that is tailored from a cancer patient’s own cells, costs $475,000 in the U.S. It became the first cell therapy approved in the U.S. last year.
Novartis entered the gene therapy fray this year by acquiring the rights to commercialize Luxturna outside the U.S. Developed by Spark Therapeutics, Luxturna can partially restore vision in people with a rare form of blindness. A pair of one-time injections costs $850,000. And in April, Novartis said it will purchase AveXis for $8.7 billion to get the small company’s gene therapy for infants with spinal muscular atrophy type 1, a rare genetic disease.
Novartis says it has invested more than $1 billion in new Swiss facilities during the past five years, including a continuous manufacturing plant in Basel and cell and gene therapy production in Stein.
Novartis is not alone in keeping manufacturing of complex therapies close to home while moving production of simpler drugs to other countries. In August, the German drug company Boehringer Ingelheim said it will build a facility at its headquarters to develop new methods for producing pills, even as it shifts production of more mature drugs to lower-cost sites worldwide.