The biopharma industry continues to navigate challenging waters in 2025, with several companies announcing significant workforce reductions in just the first quarter of the year. Following a difficult 2024 that saw major players like Bayer, Bristol Myers Squibb, and Johnson & Johnson implement substantial cuts, the trend shows no signs of slowing. Let’s examine the most recent developments and what they tell us about the current state of the biotech and pharmaceutical sectors.
Industry – Recent Layoff Announcements: March 2025
Vaxart’s Strategic Restructuring – Industry
Vaxart Inc. announced a 10% reduction in its workforce on March 21, a direct response to a February order from the U.S. government to halt work on its Phase IIb oral COVID-19 vaccine trial. This restructuring comes during a 90-day limbo period, after which Vaxart will learn whether the stop-work order will be canceled, extended, or if the COVID-19 vaccine trial will be terminated completely.
According to their recent SEC filing, Vaxart had 105 employees and approximately $51.7 million in cash, cash equivalents, and investments as of December 31, 2024. This cash runway gives the company some flexibility as it navigates this period of uncertainty, but the workforce reduction signals a conservative approach to resource management during the government-mandated pause.
Elevation Oncology Pivots After Trial Disappointment – Industry
On the same day as Vaxart’s announcement, Elevation Oncology revealed plans to lay off approximately 70% of its workforce following disappointing Phase I results for its claudin 18.2 antibody-drug conjugate, EO-3021. The company is discontinuing development of this candidate and will incur roughly $3 million in one-time severance payments through June 2025.
Notably, Elevation’s Chief Medical Officer, Valerie Jansen, will step down effective March 31, though she’ll continue supporting the company in a consulting capacity. With $93.2 million in available funds as of the end of 2024, Elevation has announced a strategic pivot toward its HER3 candidate, EO-1022, being developed for HER3-positive solid tumors. According to CEO Joseph Ferra, this runway should extend into the second half of 2026, buying the company time to redirect its efforts.
TC BioPharm’s Shift to CDMO Model
TC BioPharm announced on March 20 that it would reduce its workforce by approximately 20 employees—about half of its total headcount. This reduction aligns with the Scotland-based biotech’s strategic shift toward becoming a Contract Development and Manufacturing Organization (CDMO), adopting what it calls a “more decentralized model.”
The layoffs primarily impact employees in production and quality units and are expected to be completed by the end of Q2. According to the company, these changes will generate around $4.2 billion in annualized savings. CEO Bryan Kobel framed this decision as part of a broader transition to an outsourced production model that will better position the company for future clinical trials and advancements in cell therapy manufacturing technologies.
Cargo Therapeutics’ Dramatic Downsizing
In perhaps the most dramatic workforce reduction of the month, Cargo Therapeutics announced on March 18 that it would lay off 90% of its remaining staff while suspending all development operations. This comes after an earlier round of cuts in January that eliminated 81 positions (50% of staff at that time).
The San Carlos, California-based biotech has halted work on its trispecific CAR-T candidate CRG-023 and its allogeneic platform as it evaluates strategic options, including potential reverse mergers or other business combinations. CFO Anup Radhakrishnan has stepped in as interim CEO to guide the company through this transition period. The market reaction was mixed, with shares initially falling 7.5% before rallying 19% in premarket trading the following day.
Industry Trends and Analysis
These recent layoffs reflect several key trends in the biopharma sector:
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Clinical Trial Setbacks Leading to Immediate Restructuring: Companies like Elevation Oncology demonstrate how quickly disappointing clinical results can force strategic pivots and workforce reductions.
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Regulatory Uncertainty as a Major Factor: Vaxart’s situation highlights how government decisions and regulatory shifts can directly impact operational capacity and employment.
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Business Model Transformations: TC BioPharm’s transition to a CDMO model represents a trend of companies seeking more sustainable and flexible operational approaches in a challenging funding environment.
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Cash Preservation as a Primary Motivator: Across all announcements, extending cash runway remains a consistent theme, with companies making difficult personnel decisions to ensure longer-term viability.
- Executive Leadership Changes Accompanying Restructuring: Several of these workforce reductions coincide with C-suite transitions, signaling comprehensive organizational shifts rather than mere cost-cutting measures.
Industry – What This Means for the Biopharma Workforce
For professionals in the biopharma industry, these continued layoffs create both challenges and opportunities. While job security remains a concern, the restructuring also creates a talent pool that other growing companies can tap into. Areas showing continued growth include:
- Cell and gene therapy manufacturing
- Digital health integration
- Regulatory affairs specialists, particularly those with experience in navigating complex government relationships
- Contract research and development services
Those affected by these cuts may find opportunities at companies that are still in growth phases or at larger pharmaceutical organizations that continue to selectively hire despite broader industry trends.
Looking Ahead: Industry Outlook
As we move further into 2025, several factors will likely influence continued workforce decisions across the biopharma sector:
- Interest rate policies and their impact on biotech funding
- Regulatory decisions, particularly around accelerated approvals
- M&A activity, which often leads to redundancies and further cuts
- Clinical trial results for major programs
- The continued evolution of AI and computational approaches in drug discovery
While the first quarter has brought challenging news for many biopharma employees, the industry’s fundamental innovation engine remains intact. Companies continue to advance potentially groundbreaking therapies, even as they make difficult decisions about resource allocation and staffing levels.
For job seekers and current employees alike, adaptability and specialized expertise will remain valuable as the industry continues to evolve through this period of adjustment and realignment.
