Job cuts - Vaccine company Curevac cuts almost one in three jobs
At Biotech company Curevac, approximately one out of every third job is set to be eliminated as part of a corporate restructuring. The company plans to cut around 30 percent of its workforce and reduce operating costs by more than 30 percent starting next year. Curevac announced this in Tübingen. The headquarters in Tübingen will reportedly be most affected by the cost-cutting measures. However, this is a restructuring of the entire company. Curevac has additional locations in Germany, the Netherlands, Belgium, Switzerland, and the USA. The spokesperson did not provide specific numbers. The company had previously announced in the spring that it intended to cut jobs and become more efficient.
Curevac sells rights to mRNA vaccine intellectual property
Beyond this, Curevac also disclosed that it would sell the rights to its mRNA influenza and Covid-19 vaccine intellectual property to the pharmaceutical company GSK from the UK for up to 1.45 billion Euros. Curevac will receive an initial payment of 400 million Euros, up to 1.05 billion Euros in milestone payments, and additional variable payments. The Curevac stock price increased by nearly 28 percent as a result.
Chairman of the Board of Directors Alexander Zehnder sees a new chapter for the company: "Although the personnel reduction (...) is a difficult decision on a personal level, I am convinced that this is a necessary step to secure the long-term success of Curevac," he stated. The GSK deal not only provides extensive financing but also enables Curevac to optimize its business operations and focus on technology innovation, research, and development.
During the Corona pandemic, the biotech company was initially seen as a promising contender in the development of a vaccine against the virus. However, due to relatively low efficacy, Curevac withdrew its first vaccine candidate from the regulatory approval process.
Losses of millions in 2023
In the previous year, Curevac reported a pre-tax loss of approximately 260 million Euros. In 2022, this loss was around 249 million Euros. The revenue decreased by 13.6 million Euros to 53.8 million Euros in the same period. This decline was mainly due to lower sales from two cooperation agreements.
The vaccine manufacturer is currently working on the development of a second-generation Corona vaccine, among other things. The company is also researching vaccines for cancer therapy. However, a product is not yet available on the market. After the restructuring, the focus will be on investments with high potential in the oncology sector - that is, the field of medicine dealing with tumors.
- In response to the job cuts at Curevac, several employees in the Netherlands expressed concerns about their future roles within the company.
- The Group restructuring at Curevac has also impacted its operations in Baden-Württemberg, Germany, where the company has a significant presence.
- The announcement of job cuts and cost-saving measures at Curevac was met with disappointment by some stakeholders in the United States, where the company has a significant workforce.
- The government of Great Britain, which has a stake in GSK, welcomed the GSK deal with Curevac, seeing it as a potential boost to the UK's pharmaceuticals sector.
- Researchers in Belgium and Switzerland expressed hope that the restructuring at Curevac would not affect their collaborative projects in the field of medicine and vaccine development.
- The sell-off of its mRNA vaccine intellectual property to GSK has allowed Curevac to invest more heavily in the development of cancer therapies, a focus area for the company post-restructuring.
- The Coronavirus pandemic has highlighted the importance of pharmaceutical research and development, with companies like Curevac at the forefront of the search for a COVID-19 cure.
- Despite the numerous challenges faced by Curevac in recent years, the company's leadership remains optimistic about its future potential, with Chairman Alexander Zehnder citing the GSK deal as a significant step forward.
- As Curevac moves forward with its restructuring plan and focuses on high-potential investments in the oncology sector, industry experts will closely watch the company's performance and progress in the years to come.
