Last week the biotech community in San Diego suffered a tough blow as many positions were eliminated as part of a plan to save $20 million dollars in the hopes that Life Tech will please their investors.  People who lost jobs included veterans with the company, many who were loyal and hard-working to the almighty borg of biotechs, sacrificing their nights, vacations, and weekends to promote the success of an organization that never sleeps.

Life Tech was formed out of a merger of two companies; Carlsbad-based Invitrogen and Foster City-based Applied Biosystems. The acquisition of ABI by Invitrogen in 2008 resulted in the $6.7 billion dollar company renamed Life Technologies, which holds some of the hottest IP in the world, including lucrative patents on PCR, qPCR, and market domination in Human ID/forensics. With a portfolio this powerful, how could they fail?

Life has not reported how many people were sent home last week and they have not updated their numbers on the State Employment Development Department website which tracks company layoffs, according to the Worker Adjustment and Retraining Notification (WARN) Act.  Anonymous sources say approximately 2-4% of their workforce (11,000 people globally and 1,300 people in Carlsbad) will be downsized by the end of the year. While specific positions were not listed as targets, the layoffs are affecting all areas of the business, including R&D, corporate marketing, product marketing, and operations.

It has not escaped notice of many that the laid off people were predominantly over forty years old and had committed a substantial number of years to IVGN/ABI/Life Tech. No good deed goes unpunished.  The age factor has led to speculation that an ageism lawsuit may be in the works.

What reasons were given for the emergency downsizing to rescue Life Tech from a growth rate of only 4.1%?

Greg Lucier, CEO of Life Tech, blames the problems on a lack of demand for their products (although the NIH budget cuts were much less than expected), trouble meeting the demand for the SOLiD sequencing instruments because the earthquake in northeastern Japan interrupted production of needed parts, and low sales in China (ref).

There was not mention of Ion Torrent playing a role, either positive or negative for Life Tech, although, according to posters on an anonymous forum, many people feel too much money was invested in the Ion Torrent technology that is not showing return.  Ion Torrent may be the goose that lays the golden egg, but it will be too late for the 200-400 people that will be facing job hunting in an economy that can’t handle more unemployed people at an age where many companies may not choose experience over salary.

Personally, I find the lack of demand an unfortunate excuse. With one of the broadest and best portfolios in the world, there certainly isn’t a lack of demand for the products. Perhaps more marketing should have been done to determine where demand went before eliminating some of the best people in the business.

Many of these people will get picked up easily. Their knowledge and tenacity are worth their weight in pay. Others will struggle as most biotech companies are in a hiring freeze for the rest of the year. People did receive severance packages and won’t be totally abandoned to figure out how to come up with next month’s mortgage.  But it’s an employer’s market and many will not be able to demand the salary they once had.  

For the people who made the (first round) cuts, their workload will now become so oppressive, they should be begging for a severance package by December.

What’s the lesson in this? The lesson is that loyalty will only get you so far. In the corporate world, the bigger the company, the less significant you are. In the end, you’re a number on a spreadsheet and when the hammer comes down, you might be on that list, even if you do work 14 hrs a day 7 days a week.  So your network is more important than ever. Making friends, connections, forming collaborations, and staying in touch with your old co-workers will help you bounce back fast in a down economy.  Don’t wait- start now.

And don’t get too cozy in that cubicle.

http://www.signonsandiego.com/news/2011/aug/18/layoffs-underway-carlsbad-based-life-technologies/