Vertex Pharmaceuticals is getting rid of 370 posts, or 15% of its staff, as ithe company prepares for its hepatitis C drug Incivek to be swamped by the next wave of new treatments fro the disease.
Incivek (telaprevir) was launched to great fanfare in May 2011 and enjoyed phenomenal sales instantly. The drug has brought in over $2 billion in revenues but third-quarter sales fell $86 million from $156 million in the second quarter.
The problem for Vertex is a raft of new HCV drugs on the horizon, notably Gilead Sciences’ NS5B polymerase inhibitor sofosbuvir in combination with ribavirin, which has just been backed by a US Food and Drug Administration advisory panel. Vertex chief executive Jeffrey Leiden said that “fewer people are starting treatment with Incivek, and as a result, we are reducing our workforce supporting this medicine”.
Some 175 positions of the 370 are being eliminated at Vertex headquarters in Massachusetts and the company anticipates a $150-$200 million reduction in 2014 operating expenses compared to 2013. Restructuring charges will be in the region of $40 million.
The cuts will leave Vertex with 1,800 staff and the company ail concentrate its efforts on “cystic fibrosis and other high-potential R&D programmes”. This means a focus on Kalydeco ivacaftor), and combinations thereof, and the CF drug is already a decent earner. Third-quarter sales more than doubled to $101.1 million.
