Biotech sees more job cuts

The firms, all located in San Mateo County, are just a few of the biotechnology companies this year that are downsizing and reducing workforces, facilities or both. Bristol Myers Squibb’s layoff notice is also accompanied by its plans to shutter a recently opened Brisbane center, the San Francisco Business Times reported.

Because of the longer investment return cycle, especially compared to the technology industry, life science companies are often more susceptible to interest rate hikes, and, last year, saw the highest rate of biotech layoffs in the county in nearly a decade. About 30% of all layoffs, or roughly 2,260, of job cuts in 2023 came from life science firms.

And the post-pandemic slump isn’t limited to Peninsula-based firms, with Pfizer, maker of one of the blockbuster COVID-19 vaccines, reversing its gains from 2020 and 2021.

“Regarding biotech layoffs in the county, we do expect to see more of the same in the next few months as companies continue to battle economic headwinds. The good news is that while some companies are experiencing lay offs, others continue to hire,” Vicki Brannock, senior director of workforce strategy and innovation at Biocom California Institute, said.

She added that roughly 2,000 roles are currently available in the area.

While interest rate cuts are no longer anticipated in the near term, their stabilization has offered a sense of cautious optimism. Venture capital investment still remains low compared to prior years, but life science funding in the Bay Area has steadily increased since the beginning of last year. This year’s first quarter showed $2.3 billion of venture investment in life science firms in the Bay Area, compared to $1.8 billion from last year’s first quarter, according to Newmark data. When those gains will materialize into strong job growth and a healthier commercial real estate market is still to be determined, but some large office and lab projects — such as a recently proposed seven- and eight-story Belmont development — have still signaled interest in moving forward.

Sanofi, Genentech and Twenty Twenty Therapeutics also announced layoffs last month.