Millennium to ax 100 jobs and focus on cancer drugs
By Ross Kerber, Globe Staff | October 27, 2005
Millennium Pharmaceuticals Inc. said yesterday it will cut about 100 jobs, 8 percent of its workforce, and abandon work on some treatments for inflammatory conditions to focus on cancer drugs.
The Cambridge company also will move out of some office space near Kendall Square.
The moves mark the latest retrenchment by Millennium, once seen as Cambridge's most promising drug-discovery company, and the culmination of a strategic review that chief executive Deborah Dunsire began in June when she replaced longtime chief executive Mark Levin. Like other biotechnology companies, Millennium has struggled to profit from current products while funding efforts to find new blockbusters.
Dunsire said the moves were necessary to get products now in clinical trials on the market, while keeping in place financial targets for next year.
Millennium will end up with 300 drug-discovery scientists, she said. It had about 760 several years ago. The cuts will result in restructuring charges of about $80 million.
The actions were more attractive than alternative cost-cutting measures, Dunsire said, such as giving up more control of products like its cancer drug Velcade through deals with other drug companies.
''These moves put us in a strong position to achieve [financial] targets through organic growth, so we don't have go out and strike a big partnership to achieve the goal," she said.
Millennium still aims to bring to market products to treat inflammatory diseases such as rheumatoid arthritis and multiple sclerosis that are now in clinical trials, but will wind down discovery efforts in those areas, Dunsire said.
Millennium had about 1,500 employees at the end of 2004 and about 1,450 in July when Dunsire disclosed her first major initiative, to sell additional rights to Schering-Plough Corp. for the heart drug Integrilin. That resulted in the loss of 200 jobs, mainly in Integrilin's sales force, though the majority of the affected employees were offered positions with Schering-Plough, she said.
The moves unveiled yesterday will eliminate about 130 of the company's remaining 1,250 jobs, including 40 in business operations and 90 related to discovering treatments for inflammatory conditions. But about 30 of those 90 employees will be offered jobs in the company's oncology area, Dunsire said, for a net loss of 100 jobs.
Millennium also will pull out of space it leases at 270 Albany St., one of six buildings it now occupies. It is considering vacating other office space, but won't completely abandon any other buildings, a spokeswoman said.
The company disclosed the job cuts and changes after the end of trading yesterday. Its stock began the year at about $12, but closed yesterday at $8.51, down 13 cents, having given up gains that followed the unveiling of the Schering-Plough arrangement.
For the three months ended Sept. 30, the company lost $73.8 million, compared with $63.1 million for the same period a year ago. Revenue rose to $201.7 million from $109.9 million a year earlier, partly on increased sales of Velcade.
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