Novartis shutters MorphoSys sites, lays off staff

Swiss pharmaceutical company Novartis plans to close MorphoSys sites in the U.S. and Germany in a “strategic decision” that will affect 330 jobs.

The move, which was first reported by the German magazine WirtschaftsWoche, stems from Novartis’ evaluation of its R&D priorities and the time needed to determine an approval path for MorphoSys’ drug pelabresib in a bone marrow cancer.

“Novartis remains committed to advancing the development of pelabresib,” a spokesperson said in a statement to BioPharma Dive. “The teams continue to work on the R&D programs and support the integration of activities into Novartis.”

Novartis agreed to acquire MorphoSys for about $2.9 billion in a February deal to gain access to pelabresib, which the German biotechnology company developed for myelofibrosis, a rare condition that causes abnormal blood cell production.

Novartis had high expectations for the drug after its success in late-stage testing alongside the approved treatment Jakafi. But trial results were somewhat mixed and, per reporting by Stat, safety concerns later cropped up, sparking doubts about the drug’s approval chances.

Still, Novartis moved ahead with closing the deal, only to push back its plans for seeking clearance of pelabresib, citing the need for more data. Initially, Novartis planned to submit pelabresib to regulators this year, but CEO Vas Narasimhan recently said obtaining that data will “take us at least until 2027,” or longer.

The pharma revealed in third quarter earnings that it wrote down the value of the deal.

Outside of its MorphoSys acquisition, Novartis has been cutting back and restructuring over the past few years. In 2022, the drugmaker launched a major restructuring that affected thousands of employees. Earlier this year, the company shut down a San Diego facility involved in gene therapy production as part of a broader shakeup.

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