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Roche closes former US headquarters with loss of 1,000 jobs

Pharma company's New Jersey research operations will be consolidated in Europe

Roche - Nutley, New Jersey

Roche is to close its former US headquarters in Nutley, New Jersey, with the loss of about 1,000 jobs.

The Swiss pharma firm said the move was part of plans to streamline its research efforts, with R&D activities at the site to be consolidated to Roche's facilities in Switzerland and Germany by the end of 2013. About 80 jobs are expected to be created in Europe.

The company's CEO, Severin Schwan, said the related savings through this consolidation will allow it to reallocate resources to alternative clinical programmes, meaning R&D spending growth would be flat.

“In its 80-year old history, our Nutley site has made significant contributions to Roche's success,” he said of the site that was the company's US headquarters from 1929 until it acquired biotech California-based Genentech in 2009 and moved its base to San Francisco.

“We will do everything we can to find socially responsible solutions for the employees affected by these changes.”

The restructuring, which also sees Jean-Jacques Garaud step down from his position as head of Roche Pharma Research and Early Development, is the latest in a series of large cutbacks made by pharma companies in the US and Europe as the industry looks to cope with patent expiries, a tougher regulatory environment and tightened healthcare budgets.

These includes Merck Serono's decision to close its Geneva headquarters earlier this month with the loss of 500 jobs.

Roche's outlook is threatened in particular by generic competition for huge-selling cancer medicine Herceptin (trastuzumab), which loses patent protection in 2015, as well Xeloda (capecitabine) which loses exclusivity in 2014.

The company is already facing competition from cheap copies for its osteoporosis drug Boniva (ibandronate sodium) following its patent expiry earlier this year.

Launch of translational clinical research centre
But Roche does not intend to stop carrying out research from the east coast of the US altogether and said it would be setting up a new centre for translational clinical research.

This centre would employ 240 people and support Roche's US-based clinical trials and early development programmes, as well as maintain interactions with the US Food and Drug Administration (FDA) and US-based partners, such as academic institutions and biotech companies.

Roche said the centre is planned to be operational by early 2013, although its exact location is still to be determined.

27th June 2012

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