USA – Biogen has begun to lay off employees as part of a previously announced effort to cut annual expenses by US$500 million.

The move comes as the Cambridge, Massachusetts-based pharmaceutical company attempts to overcome obstacles in selling a new and controversial treatment for Alzheimer’s disease, as well as recover from setbacks in other areas of its business.

Biogen isn’t sharing any details on the number of affected staffers; a spokesperson said the number is fluctuating, as some people have resigned while others are eligible to apply for other positions.

“These changes will help the company remain flexible, so additional investments can be made in our pipeline and other strategic initiatives,” Biogen said of the layoffs in a statement.

“We appreciate the contributions of our departing colleagues, who will be eligible for severance and support services as they transition out of the company.”

The layoffs are part of a restructuring announced by Biogen in December that aims to save US$500 million in annual costs.

Stat News reported a few days earlier that the company was looking to save US$750 million and could lay off up to 1,000 employees.

Endpoints News reports that Biogen has already laid off more than 100 employees, including two-thirds of the Alzheimer’s commercial team and all leaders within the Alzheimer’s field sales force, citing a senior company executive.

Aduhelm’s fourth-quarter sales were only US$1 million, hardly a significant increase from around US$300,000 in the third quarter of 2021.

The restructuring was prompted by the poor reception of Aduhelm, an Alzheimer’s disease drug, due to controversies surrounding the first-in-class antibody’s efficacy and safety profile, as well as Biogen’s allegedly questionable interactions with the FDA in the run-up to approval.

With the Centers for Medicare & Medicaid Services (CMS) issuing a restrictive draft coverage decision, the drug’s market potential does not appear to be improving.

The US agency is requesting that patients be enrolled in an approved clinical trial to be eligible for reimbursement, which would significantly limit the scope of Aduhelm coverage.

If the draft policy is approved as is, Biogen’s sales and marketing activities related to Aduhelm will be severely limited for years.

Some commercial insurers have stated that they will assess their own stance on Aduhelm in light of the CMS plan.

In the meantime, Biogen and its partner Eisai are rallying support, urging CMS to expand coverage to include patients from Aduhelm’s two phase 3 trials.

However, the CMS has received a majority of comments in support of the agency’s current proposal.

Liked this article? Sign up to receive our regular email newsletters, focused on Africa and World’s healthcare industry, directly into your inbox. SUBSCRIBE HERE