Astellas said yesterday it will shut down this year two U.S. laboratories obtained in recent acquisitions, narrow the focus of its Astellas Research Institute, and shutter a Japanese lab in 2015, all as part of an R&D restructuring.
Set to close their doors in the current fiscal year will be the labs of Astellas’ OSI Pharmaceuticals subsidiary at the Broad Hollow Business Park in Farmingdale, NY, and of the Perseid Therapeutics subsidiary in Redwood City, CA.
Astellas did not disclose how many jobs would be eliminated at either facility, though the newspaper Newsday of Melville, NY, reported all 115 OSI staffers were told they were being laid off as part of a consolidation that would cut a total of 200 jobs. According to its annual report for the fiscal year that ended March 31, Astellas had 2,919 staffers in the Americas at the end of last year.
Astellas acquired OSI in 2010 and Perseid a year later when it bought Maxygen’s interest in the joint venture.
Some functions at the OSI and Perseid sites will be transferred to Astellas’ Tsukuba Research Center, a 1.5 million-square-foot drug discovery research facility in Tsukuba City, Japan, opened in 2008. Also moving to Tsukuba will be “multiple” functions of Astellas’ Kashima research site in Osaka, Japan, which the company said it will shut down in 2015.
The Astellas Research Institute in Skokie, IL, will be refocused into an R&D site for CNS drugs. By April 2014, Astellas plans to consolidate its Clinical Development, Quality Assurance & Regulatory Affairs, and Pharmacovigilance functions by moving them from Itabashi-ku, Tokyo, closer to Astellas’ headquarters in Nihonbashi, Chuo-ku, Tokyo.
And by 2015, Astellas plans to shut down its Kashima research site in Osaka, Japan, and halt all in-house fermentation research, mostly conducted in Toyama, Japan.
In a statement, Astellas said the restructuring was necessary “to further enhance the ability to generate innovative drugs.” The company articulated four goals: “utilize more external capabilities and resources; undertake initiatives related to new therapeutic areas and innovative technologies including regenerative medicine and vaccines; accelerate the development of Astellas’ promising preclinical pipeline; and ensure sufficient investment in late-stage clinical pipeline.”
Astellas said its forecasts for the fiscal year ending March 31, 2014, will include a JPY 11 billion ($108 million) charge reflecting the lab shutdowns and cutbacks.
The latest restructuring marks the second wave of cutbacks for Astellas in less than a year. The company in August closed its Urogenix R&D site in Durham, NC, which focused on urology research, and transferred its urology research activities to Tsukuba. Astellas also acquired the Urogenix site via acquisition, namely its 2006 purchase of Dynogen Pharmaceuticals.
Astellas follows other pharma giants that have shrunk their R&D operations in recent years—a category that includes AstraZeneca, Roche, Pfizer, and Takeda—as companies scramble to justify multi-billion-dollar investments in research and development of new drugs, or in some cases, brace for multi-million-dollar revenue losses as blockbusters lose patent protection.