US biotechnology company Amgen is to lay off more than 1,000 employees, including 675 at its headquarters in California and the remainder at its facility in West Greenwich, Rhode Island, according to media reports, as part of moves announced last month.
In August, Amgen's chief executive Kevin Sharer initiated a massive cost-cutting effort, which included the loss of between 2,200 and 2,600 jobs as part of a bid to save between $1 billion and $1.3 billion in 2008.
Amgen has been hit by safety concerns over the erythropoietin stimulating agent class of anaemia drugs, including its top-selling Aranesp (darbopoietin alfa), in addition to new Medicare guidelines for ESA use restricting their reimbursement. According to one analyst, "Amgen will likely lose at least 40% of their US Aranesp revenue by 2008 with even greater downside possible for both Aranesp and Epogen (epoetin alfa) if reimbursement and regulatory decisions go against them."
In a positive move recently, however, the US Senate has called on Medicare to reassess the decision to restrict coverage of anaemia drugs. Epogen and Aranesp generated nearly $7 billion in sales for Amgen last year, almost half its revenues.