Syntex lays off 1,000 employees
Publication Date: Wednesday Jan 18, 1995

BUSINESS: Syntex lays off 1,000 employees

Most of the reductions at Palo Alto firm were completed in December

by Don Kazak

Syntex Corp. of Palo Alto, which was purchased three months ago by Swiss pharmaceutical giant Roche, has completed the process of reducing its local workforce from about 3,000 employees to 2,000. The elimination of about 1,000 local jobs at Syntex was done quickly in December as Syntex became essentially a research facility with support staff and some strategic marketing planning staff. Previously, Syntex also had a marketing staff here along with corporate headquarters personnel.

Suzanne Ward, who was laid off as director of public affairs at Syntex, said the company "is doing a really good job" of helping former employees find new work.

Ward said she is starting her own consulting company. She has a job counselor assigned to her and attended classes to help her start the company.

Syntex employees with more than 10 years tenure at Syntex received six weeks pay for every year they worked. Other employees received four weeks pay for each year they worked. The compensation includes a continuation of health and other benefits.

Syntex spokeswoman Nancy Peterson said Syntex has also recently established a transition and resource center in Mountain View for former employees, offering help in resume writing and job searches. In addition, the resource center has job listings from companies that are interested in hiring former Syntex workers. Many of those companies took the initiative to contact Syntex, Peterson said.

For former Syntex employees, Ward said the center has "lots of job listings from many companies."

The center will probably remain open at least six months.

Peterson said Syntex began holding company seminars last year on trends in the pharmaceutical industry, even before the exact nature of the layoffs were known. "We felt it would be appropriate to give people a head start," she said.

The Roche Group also recently announced that it will close down a New Jersey biomedical research facility and move those functions to Syntex's Palo Alto site, which will be one of its four research centers around the world. The others are in Switzerland, England and Japan.

Peterson said Syntex research will focus on developing medications in four different areas: immunology; bone and joint diseases; gastrointestinal diseases and urinary tract disorders; and pain reduction.

She said Syntex expects to have 2,000 employees here for the foreseeable future.

For those remaining at Syntex, the Palo Alto campus will continue to focus on research.

In addition to the research in developing new pharmaceutical products, Roche will establish its Roche Institute of Molecular Biology at Syntex, with a strong emphasis on genomic sciences, the study of the genes contained in the chromosomes of each cell in an individual.

Peterson said the genomic research is being located here because of Stanford University and its biomedical research and the genomic work being done in the Bay Area in general.

"There are advantages to recruiting," she said. There is no timeline yet for phasing in the institute, she added, and a director is still to be hired.

Syntex was founded more than 50 years in Mexico and relocated to Palo Alto in 1962, rising to success on the strength of its oral contraceptives.

It also produced Naprosyn, a pain killer that was a tremendous success. Naprosyn and another arthritis drug, Anaprox, accounted for 48 percent of the company's sales in 1992. But the two drugs lost their patents at the end of that year, triggering large financial losses for the company. The company also lost the faith of Wall Street investors, as its stock price plummeted from $54 a share in January 1992 to $18 a share in mid-1993. Syntex stock stood at about $24 a share in October when Roche purchased the company for a reported $5.3 billion.

Syntex occupies 22 buildings totalling 1.3 million square feet in the Stanford Research Park. Peterson said not all of that space will be needed by the company. "Clearly, we will need less space," she said. "But we haven't worked that out yet."

Syntex also received government clearance this month to begin marketing Cytovene, which is used to treat eye disorders in people who suffer from compromised immune systems, including AIDS patients. Cytovene previously was available only through injections.

"Approval of the oral form of (Cytovene) is a major breakthrough for people with AIDS who have CMV disease," said Ronald Baker, editor of BETA, an AIDS treatment magazine. CMV stands for cytomegalovirus, which causes inflammation of the retina of the eye that can lead to blindness.

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