Dive Brief:
- Pfizer laid off 210 workers at two North Carolina sites on July 25 as both facilities undergo major changes, according to a state Worker Adjustment and Retraining Notification Act notice.
- While Pfizer’s Sanford site will remain open, 150 employees will be let go due to a high-profile Phase 3 trial failure in June for Pfizer’s experimental gene therapy to treat Duchenne muscular dystrophy, a company spokesperson emailed Manufacturing Dive.
- Meanwhile, 60 jobs were cut at its Rocky Mount sterile injectables facility as it shutters certain drug production lines due to the discontinuation of its large volume solutions business, the spokesperson said.
Dive Insight:
Pfizer will not continue the gene treatment program at the Sanford site. The pharmaceutical company said treatment did not improve motor function among patients during the Phase 3 trial — an important test of the therapy’s potential.
As a result of the trial failure, the company is “reviewing all future options,” including possibly selling a separate North Carolina facility it acquired from contract manufacturing firm Abzena in 2023 which is involved in the program. The building was scheduled to open by the end of the year, but manufacturing plans changed “to create operational efficiencies,” the spokesperson said. No buyer has been identified yet.
In a Q2 earnings presentation on July 30, Pfizer said it’s taking a $230 million impairment charge due to the therapy’s discontinuation.
Pfizer also expects to take an additional $400 million charge for the sale of a Duchenne muscular dystrophy-related facility in the third quarter, according to the presentation.
Although Pfizer is dropping the gene therapy, the company will continue operations at the Sanford facility and “will likely pick up the production which had been planned for the new site,” the spokesperson said.
In addition to DMD treatments, the Sanford facility also produces substances and drug products for hemophilia B and hemophilia A gene therapy candidates.
Meanwhile, changes are being made at its Rocky Mount site as it faces lower projected product demand and ongoing site modernization efforts, the spokesperson said. The company is shifting its large volume solutions business to a contract manufacturing organization, effective July 31.
“As a result of this effort and to ensure capacity at the site is being effectively utilized, the site will decommission select manufacturing lines while transitioning the startup of new lines on site,” the spokesperson said.
Nearly 25% of Pfizer's sterile injectables used in U.S. hospitals are produced at the Rocky Mount site, according to its website.
In line with the growing number of layoffs at the company, Pfizer rolled out another cost-cutting program in May, according to the Q2 call. The manufacturing optimization program is projected to save approximately $1.5 billion by the end of 2027.
Phase 1 of the program is well underway with some savings anticipated to be realized in the beginning in 2025, Pfizer CFO and EVP Dave Denton said in the call. The company saw a $1.3 billion charge related to the program, primarily for employee severance, the quarterly presentation stated.
Improvements in Pfizer’s gross margin rate will continue to be a focus for the company over the next few years as it makes efforts to return to pre-pandemic operating margins, Denton noted on the call.
