Biogen Idec plans to cut 650 US jobs - 13% of it workforce - consolidate research sites, and halt some research programmes to cut costs and focus the company's resources on its core business of making drugs for neurological disorders.
The restructuring programme comes four months after the biotech company named George Scangos as its new chief executive.
Scangos replaced Jim Mullen, who resigned under pressure from billionaire investor Carl Icahn. Icahn has three representatives on the company's board.
Under the plan, Biogen, which makes the multiple sclerosis drugs Avonex and Tysabri, will cease development of cardiovascular drugs and divest its oncology assets. It will continue development of drugs to treat haemophilia, and it did not rule out acquiring cancer drugs in later stages of development in the future.
The company expects to end 11 research and development programmes and close its San Diego location. Operations in eastern Massachusetts will be consolidated into facilities in Cambridge and Weston. The plan is expected to save $300m a year, the company says.
'We will now focus on a few areas where we can be among the best, and this starts with neurology,' Scangos said. He said the restructuring was designed as much to change the company's corporate culture as to extract savings.
Biogen, one of the biggest and oldest of the world's biotech companies, has been criticised for failing to translate its scientific expertise into new products.
The company said it intends to expand its leadership in the treatment of multiple sclerosis by maximising the potential of Avonex and Tysabri, which it markets with Elan and 'aggressively' developing its pipeline of experimental MS drugs.
It will also apply its research and development expertise to developing drugs for neurological diseases such as amyotrophic lateral sclerosis, or Lou Gehrig's disease, and Parkinson's disease.
