Unfortunately, Roche is still Roche and not Genentech as Basel would have the general public believe, first, by changing their name to Genentech in the U.S., recently dropping their membership in the Pharmaceutical Research and Manufacturing Association (PhRMA), the pharma industry’s leading trade group, and then joining BIO, the international biotechnology organization. Those of us working inside the industry weren’t fooled but some have thought it’s a shrewd move in transforming themselves from out-of-date big pharma to big biotech firm when they dropped membership in PhRMA. Their major products as Roche had been Genentech products prior to buying out all of Genentech but they are still a big pharma company.  They will have potentially lessened their membership fees by the change but I hold a suspicion they did it more to get out from under the PhRMA deal with White House to give back $80 billion over the next years supporting Medicare recipients hitting the “donut hole” of Part D drug benefits.

Job cuts at Genentech were expected based on their past history of company buyouts but yours truly thought Roche would wait a bit longer. According to some close to the action, Roche’s plans for the takevoer of Genentech and associated financial plans haven’t gone so smoothly. Subsequent to earlier rough spots, I suspect the surprise that came with large majority, rather than anticipated small minority, of Nutley business and management staff opting for a transfer to California upon closing Roche’s administrative headquarters in NJ has a lot to do with the announced layoffs at Genentech. The enlarged numbers seeking the relocation package to California occurred at the same time greater numbers of their Palo Alto-based research staff (former Syntex site) than expected accepted a transfer to Nutley. I ‘m sure the original plan anticipated a major decrease in staff in both locations as a result of the shutdown of both the Nutley and Palo Alto facilities.

When I first heard about these planned transfers in NY at the UBS investment banking meeting last September, the Roche spokespeople didn’t envision major relocations but then it was a different economy in the fall of 2008.  Subsequently, there has been a major meltdown of the economy, the Pfizer/Wyeth merger, a record number of companies running out of cash as well as increased investment in jobs and off shoring of research and development in  China and India by big pharma. It’s not a surprise that employees reconsidered their chances of finding ready employment and decided to stay with Roche at least until the employment front improves.

See latest article by Tom Abate at Chronicle about details of job cuts at http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/07/10/BU6A18LRRH.DTL&type=printable. Some jobs, perhaps originally unintended, will  have to be cut to make up for that miscalculation. The methodical Roche absorption process of Genentech into its worldwide organization has non-research personnel in South San Francisco concerned.

See details about Roche dropping PhRMA membership and support of university program in NJ at http://www.nj.com/business/index.ssf/2009/06/hoffman_la_roche_planning_to_l.html

Audrey