Back in June, Meredith Bryan posted an article in Forbes about the need for a flexible workforce in the life sciences sector to drive innovation. At that time, Bryan noted, the industry was “facing a funding crisis that threatens its continued recovery from the pandemic—and could imperil its crucial pipeline of innovation.” She spoke with Angela Arriaga, vice-president of client services at RightSourcing by Magnit, who made a prophetic comment: “Everyone always says that pharma and life sciences are recession-proof. I’m not sure that’s 100% true.” Flash forward to today. Mass layoffs are now making headlines across life sciences, a response to persistent inflation and economic worries. But the demand for skilled talent to keep the wheels of innovation turning remains imperative. And that’s why life sciences leaders must consider expanding, rather than curbing, their reliance on contingent work and staffing providers during this challenging time.
A Workforce Dilemma: Life Sciences Needs Skilled Labor but Layoffs Increase
In Bryan’s article, Arriaga explained that “VCs are waiting until therapies are further along in the trial process to invest. That creates challenges for all firms, but especially smaller and mid-size companies. Meanwhile, labor continues to be expensive and competitive.”
However, she also pointed out that in this “increasingly tough macroeconomic environment,” more firms would benefit from leveraging flexible workforce strategies to “help them drive cost savings without sacrificing momentum on new advances and technologies.”
Despite the problematic optics that come with attention-grabbing layoffs captured in the news, shedding members of the workforce risks hobbling output even if investors believe they will streamline revenues. And this month alone, a lot of layoffs are making headlines. As BioSpace’s “Biopharma Layoff Tracker 2023” reports, some big names in the industry are cutting staff.
- Cell therapy company Nkarta is laying off 18 people, about 10% of its staff, it revealed in an SEC filing. The morning after the filing, the company announced that the FDA has cleared its Investigational New Drug application for NKX019, its CAR NK cell therapy candidate for lupus nephritis. The announcement also notes “cost containment measures designed to extend its projected cash runway by one year into 2026.”
- Pfizer late Friday launched a sweeping cost-cutting initiative aimed at generating $3.5 billion in savings through 2024 as the company weathers a steep decline in the sales of its COVID-19 products. Pfizer said the “multi-year, enterprise-wide cost realignment program” will involve layoffs, though it is still unclear how many employees will be affected. As of August 1, Pfizer employed approximately 83,000 people worldwide.
- Sana Biotechnology will lay off 29% of its workforce—approximately 120 people—as part of a portfolio realignment initiative, the company announced on Tuesday. Sana will narrow its R&D focus to its ex vivo cell therapy platform and move away from an in vivo gene delivery program with an eye toward reducing its 2024 operating cash burn to below $200 million.
- Biogen is laying off 113 employees from Reata Pharmaceuticals' Plano, Texas site, according to a Worker Adjustment and Retraining Notification notice. The layoffs, set to take effect in late November, come just months after Biogen acquired Reata for $7.3 billion in July 2023.
- uniQure is laying off 114 people, about 20% of its total workforce, the gene therapy company announced Thursday. The company “will discontinue more than half of its research and technology projects, including AMT-210 for the treatment of Parkinson’s disease and multiple undisclosed programs,” according to the announcement, while focusing on AAV capsid development and treatments in development for ALS and Alzheimer’s disease.
- Kezar Life Sciences is laying off 41% of its workforce and its CEO and chief medical officer will step down as part of a restructuring, the company announced Tuesday. Kezar has paused all of its research and drug discovery efforts, according to the announcement, as it focuses on shoring up enough funds for its Phase IIb clinical trial of the experimental drug zetomipzomib in lupus nephritis.
- Syros Pharmaceuticals is laying off 35% of its workforce, and its CEO and chief science officer are also departing, the company announced Monday. Syros said it is ending a Phase I trial of a potential treatment for a type of leukemia, as well as earlier-stage work on that drug, to focus on tamibarotene, another blood cancer treatment that is currently in Phase II and III trials.
That’s just a few of the companies referenced in the BioSpace report. Many life sciences organizations have also paused enrolling new suppliers into their workforce programs or MSPs, as we have previously discussed. But at this pivotal time, increasing the use of staffing providers offers life sciences the new ideas and new paths to innovation they require to thrive and stay competitive.
The Need for Contingent Staffing in Life Sciences
GlobalData predicts that the global life sciences market will grow from $1.1 trillion in 2022 to $1.8 trillion in 2028. In addition to the overall growth of the life sciences industry, however, there are a number of specific factors that should be driving the demand for contingent staffing in this sector.
- The need for specialized skills: Many of the roles in the life sciences industry require specialized skills and training. Contingent staffing agencies can help companies find workers with the specific skills they need, even if they are in short supply.
- The need for flexibility: Life sciences companies often need to be able to scale their workforce up or down quickly in response to changing market conditions. Contingent staffing can help companies meet this need by providing them with a flexible pool of workers to draw from.
- The need to reduce costs: Contingent staffing can be a more cost-effective way to staff certain roles than hiring full-time employees. For example, companies can save money on benefits and other costs by hiring contingent workers.
- The pace of innovation is accelerating: New drugs, medical devices, and diagnostic tests are being developed at a rapid pace. This means that life sciences companies need to be able to quickly scale their workforce up or down to meet the demands of their research and development pipelines.
- The industry is becoming more complex: The life sciences industry is becoming increasingly complex, with new technologies and therapies emerging all the time. This means that companies need to be able to tap into a wider range of skills and expertise to stay ahead of the curve.
- The global life sciences market is growing rapidly: This growth is being driven by a number of factors, including the aging population, the increasing prevalence of chronic diseases, and the growing demand for personalized medicines.
How Contingent Staff Help Life Sciences
Life sciences companies are using contingent staff in a variety of ways.
- To fill specialized roles. Life sciences companies often need to fill specialized roles, such as clinical research scientists, data analysts, and biotech engineers. Contingent staffing agencies can help companies find workers with the specific skills and experience they need, even if they are in short supply. And the roles themselves are changing. In the United Kingdom, for example, researchers are discovering that more technical skills, particularly in data science and analytics, are becoming just as important as laboratory skills.
- To scale their workforce up or down quickly. Life sciences companies often need to be able to scale their workforce up or down quickly in response to changing market conditions. For example, a company may need to hire more clinical research associates to support a new drug trial. Contingent staffing can help companies meet this need by providing them with a flexible pool of workers to draw from.
- To access new technologies and expertise. Contingent workers can help life sciences companies access new technologies and expertise without having to make a long-term investment in full-time employees. For example, a company may need to hire a consultant to help them implement a new software system.
Benefits Contingent Staffing in the Life Sciences Industry
There are a number of benefits to using contingent staffing in the life sciences industry.
- Flexibility: Contingent staffing provides life sciences companies with the flexibility to scale their workforce up or down as needed. This is important in an industry that is constantly changing and evolving.
- Cost-effectiveness: Contingent staffing can be a more cost-effective way to staff certain roles than hiring full-time employees. For example, companies can save money on benefits and other costs by hiring contingent workers.
- Access to talent: Contingent staffing agencies can help life sciences companies find workers with the specialized skills and experience they need, even if they are in short supply.
Contingent workers can help life sciences companies meet all of their challenges. They can provide the flexibility, expertise, and scalability that lead to success in rapidly changing and dynamic business landscapes. With economic pressures, instability, and more layoffs likely in the future, companies in the life sciences sector should consider using contingent staffing to meet their workforce demands and achieve their business goals.