An overview of biotech layoffs in 2023 (2024)

By Brian Buntz | August 9, 2023

The first half of 2023 brought job cuts to roughly 100 biotech and pharma companies. But while that may indicate an unstable employment landscape, it is not a universal trend.

Since March, appetite for life sciences talent has gathered steam. According to data from real-estate firm JLL, June 2023 had the sixth highest number of biopharma job openings of any month on record. Figures for that month were on par with peaks in 2022 and up 11% year-over-year. Job openings were lowest in February in 2023, but the volume of openings at that time was still substantially higher than most of the months from 2019 to 2020. Check out the data in the chart below.

Challenges and opportunities amidst biotech layoffs in 2023

The haves vs. have-nots. The industry is divided between the “haves and have-nots,” Michael Yee, a Jefferies biotech analyst told WSJ in February. While biotech layoffs in 2023 are common, companies with promising pipelines and ample funding continue to prosper. A good number are capitalizing on the falling valuations of some companies and actively pursuing , which have rebounded in 2023. Sanofi, Merck and Novartis are notable examples of companies hungry for acquisitions.

Conversely, smaller companies grappling with limited funding and rising interest rates are more likely to cut workers. Similarly, many private biotechs are postponing or canceling plans to go public as a result of the skittish investment landscape in the sector. Political tensions and new laws allowing Medicare to negotiate drug prices have further complicated the industry’s stability. Big Pharma companies like Merck and Bristol Myers Squibb are suing to stop the government from rolling out the Medicare initiative.

Historical context of growth

While the biotech market has faced challenges with layoffs in 2023, the industry witnessed significant job growth beforehand. According to a 2022 report from CBRE, the number of employees in the U.S. life sciences industry expanded 5.3% from January 2021 to January 2022, outpacing the national job growth rate of 4.7% in the same period. Growth in biotech R&D was especially strong, growing 11.5% in the same period.

Growing demand for AI roles

Another bright spot is demand for AI-related roles in pharma and biotech. The trend is especially evident in Big Pharma as companies like Johnson & Johnson, AstraZeneca, Takeda, Novartis and Pfizer actively seek to fill thousands of AI roles. A Deloitte survey of C-suite executives in biopharma and medtech revealed a majority of executives are convinced that machine learning, analytics and business intelligence will have a large impact on the industry. A flurry of AI-related headlines underscores this trend.

A summary of biotech layoffs 2023

The following table summarizes companies that have announced workforce cuts in 2023. Of the companies that cut workers in the first half of 2023, smaller firms and startups outnumbered Big Pharma companies more than five to one:

Filed Under: Drug Discovery, Drug Discovery and Development, machine learning and AI, Regulatory affairs
Tagged With: AI roles in pharma, Big Pharma companies, biopharma job openings, biotech layoffs 2023, , job growth in life sciences, pharmaceutical mergers and acquisitions