Vertex to Chop Over 300 Jobs, Pay Back MA Tax Credits
October 30th, 2013 // 6:17 pm @ jmpickett
Vertex Pharmaceuticals once represented the explosive growth of the biotech industry in Massachusetts. Over the last 24 months, the company has gotten FDA approvals to sell hepatitis C drugs and also drugs to combat cystic fibrosis. It emerged in that time as one of Wall Street’s favorite companies.
But this week, the momentum stopped. Only 60 days before Vertex is palling to move more than 1300 workers from Cambridge MA to a new building on the Waterfront in South Boston, the firm finally admitted that it had made a misstep on the size of the market for its top hepatitis drug, called Incivek.
The sales of the drug have been sharply dropping, so Vertex is going to cut about 18% of its total workforce, or as many as 370 jobs. One hundred seventy five of those will be in MA. It also is going to return over $4 million in tax incentives in Massachusetts that it was given to create jobs.
Still, Vertex could be an anchor of the biotechnology field in Boston. But for this to happen, top company officials are going to need to build a true multi drug pipeline, which is not something that many in the biotech field want to do. One of the first tests of this is going to be to get FDA approval for cystic fibrosis drugs it is making.
The additional focus on the different market area did not cause there to be any less upset when the job cuts were announced. It was the first major layoff in 10 years at Vertex.
The sales of the drug Incivek has fallen a lot faster than the company expected. The reason is that many physicians have encouraged many of their patients to wait for newer treatments that they think are going to work better.
A high level of the recent hires at Vertex has been related to the promotion of Incivek, which is thought to be a very promising treatment for hepatitis C as of 2010.
After these job cuts, the firm will still have 1800 employees around the world and 1300 near Boston.
Genzyme also recently had to return $6 million recently in tax incentives after the company did not create the number of jobs it expected in the state.
