Health
Amgen begins voluntary staff reductions in one R.I. plant
01:00 AM EDT on Thursday, August 30, 2007

Employees of Amgen in West Greenwich are among those who will be offered buyouts so the company can achieve a 14-percent reduction in its worldwide work force.
The Providence Journal / Frieda Squires
Amgen Inc., one of the state’s largest employers, has begun reducing its Rhode Island staff as the company prepares to shut down one of the two drug production facilities at its West Greenwich complex.
A segment of the plant’s 1,600 employees has been offered a buyout package that includes a lump-sum payment, a period of continued health insurance and career counseling, Amgen spokesman Larry Bernard said.
Employees who have worked for Amgen less than five years are ineligible. The individual “voluntary transition program” packages, part of a companywide program, are structured based on an employee’s salary and tenure.
Amgen, based in Thousand Oaks, Calif., has not disclosed how many Rhode Island positions will be eliminated as part of an effort, announced Aug. 15, to reduce capital expenses company-wide by $1.9 billion.
The plan calls for a 14-percent reduction in the company’s worldwide staff. If distributed equally across all facilities, that would mean 224 Rhode Island employees would lose their jobs.
Bernard declined to disclose how many, if any, of Amgen’s Rhode Island workers have agreed to retire voluntarily. Their decisions are due early next month.
“We still need Rhode Island,” Bernard said. “We’ll still be big; we just won’t be as big.”
But Bernard said layoffs, the first for the company’s Rhode Island complex, are inevitable.
That would deal a blow to the state’s nascent efforts to develop a biotechnology industry modeled on the success in Massachusetts.
Rhode Island officials have long highlighted Amgen’s growth here — including $1.5 billion in private investments — as heralding the birth of a biomanufacturing sector that would generate jobs and lift the state’s median income. At its peak, Amgen employed 1,700 in Rhode Island.
In speeches about the industry, state economic-development officials have used Amgen as shorthand for the transformation of the state’s sputtering industrial base.
They now face the prospect of former Amgen employees struggling to find new jobs in Rhode Island or being forced to commute out of state.
That dilemma highlights the difficulty of building a biotechnology industry on the strength of one major player, say industry analysts.
So far, most of the state’s biotechnology companies are small start-up firms focused on research and development, not manufacturing. Amgen employees, skilled in producing protein therapeutics, are more highly trained than their counterparts in traditional manufacturing. But outside the company, the few biotechnology jobs available in the state require far more training and often a doctorate, according to Barrett W. Bready, an assistant professor at Brown University and chief executive officer of NABsys Inc.
“Earlier-stage companies have a higher percentage of employees with advanced degrees than do manufacturing sites for biotech companies,” Bready said. “It’s not easy to go from that to a research-and-development position.
“It’s an underdeveloped industry in the state,” Bready said. “There aren’t a lot of positions.”
Alexion Pharmaceuticals Inc. recently spent $47 million to transform the former Dow Chemical facility in Smithfield into a biomanufacturing plant for the drug Soliris.
But after hiring 100 employees, including at least 35 scientists, Alexion appears unlikely to be able to absorb many of Amgen’s former employees. An Alexion spokesman was not available for comment yesterday.
Amgen’s troubles, precipitated by steep declines in sales of its anemia drugs Aranesp and Epogen, could also pose a challenge to the University of Rhode Island.
In 2003, URI established a biomanufacturing program, turning to Amgen for money, equipment and advice on developing the curriculum for a special bachelor of science degree.
The program prepares undergraduates for precisely the type of jobs available at Amgen, which has hired several graduates as interns and permanent employees at its plants, built side by side off Route 95.
When it helped URI establish the program, Amgen’s profits were growing rapidly and its Rhode Island footprint was expanding. It has since added a second, significantly larger plant in West Greenwich, creating one of the world’s largest biomanufacturing facilities. Both plants operate 24 hours per day.
Demand for Enbrel, the rheumatoid arthritis drug produced here, has grown steadily. But Amgen’s financial downturn has pushed it to consolidate all Enbrel manufacturing into the newer plant. Instead of using the original plant to launch a new product, the company is vacating it entirely.
“We’re becoming more efficient in the new plant, and those efficiencies have become more apparent,” Bernard said. “We don’t know exactly what our needs are going to be.”
Amgen is also cutting staff at its research facility in Cambridge, Mass., where it employs about 200 scientists. A spokeswoman for the facility did not respond to a call yesterday.
Jeffrey R. Seeman, dean of the College of Environment and Life Sciences at URI and one of the biggest boosters of the state’s biotechnology industry, says he is not panicking.
Some URI students, Seeman said, might have to find jobs in Massachusetts. But in the long run, he said, programs that churn out biotechnology experts will help the state draw the next Amgen.
“It is part of what will attract new companies here. They know we can give them the trained workforce,” Seeman said. “It’d be a mistake for Rhode Island to shy away from this because of a little stumble by Amgen somewhere else.”
Robert F. Valentini, chief executive officer of the Providence-based biotechnology firm Myomics Inc., said Amgen employees who lose their jobs may not find new positions in Rhode Island.
But the expected layoffs, he said, are not a sign of industry-wide problems in the state.
“You see companies grow and shrink,” Valentini said, citing pressures from expiring patents and the high cost of developing new drugs. “Part of being a player in biotech is understanding that.”
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