The US may be riddled with layoff announcements, but it isn’t the only region undergoing considerable changes in 2025. Australian biotechnology firm CSL has announced layoffs among its workforce, with major reorganization efforts expected to alter the makeup of the business. CSL is set to lay off 15% of its global workforce, along with plans to spin off its flu vaccine arm, Seqirus, by early 2026.
Known as the world’s second-largest influenza vaccine maker and Australia’s fourth-largest company, CSL’s decision has stunned investors and employees alike, sending the company’s shares plunging over 15%. The decision comes amidst shifting sentiments regarding vaccines in the US, which the CEO referred to as “highly irrational” softness in the region. Despite the company’s 14% jump in annual profit, CSL’s workforce cuts have largely overshadowed any conversation regarding its strong performance.
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The CSL Layoffs Deal Another Major Blow to the Biotechnology Industry
Emerging reports on the CSL layoffs indicate that the company will cut 15% of its workforce, which is estimated to add up to 3,000 workers. The CSL cuts have been linked to efforts to manage R&D costs, with the full-year earnings report suggesting it will “reduce the proportion of fixed cost in overall spend, and implement initiatives to increase pipeline productivity, including consolidation of R&D footprint.”
The company’s primary focus lies in the area of blood plasma treatments for rare illnesses, and profit growth in the area was also found to be slower than expected. As a result, Reuters reports that the organization closed 22 collection centers, and it will continue to consolidate its R&D efforts in the area. The 15% layoffs at CSL will occur outside of its U.S. plasma unit, but the company hasn’t offered more details on where the cuts will be centered instead.
What we do know is that CSL will cut its workforce and demerge the Seqirus vaccine arm to simplify operations and generate cost efficiencies. CSL’s biotech restructure plans are expected to save the company up to $550 million over three years, although it does foresee a one-off pre-tax charge of up to $770 million in its ongoing financial year.
CSL’s Workforce Cuts Are Telling—The Biotech Industry Is Downsizing
Despite the shake-up, CSL’s full-year profits rose 14%, and the company announced a A$750 million share buyback and increased dividend. The company may have witnessed slower growth than expected, but it is still on the path to successful numbers and returns on investment.
CSL’s plans to lay off 15% of its workforce and spin off its vaccine division have come as a surprise to many, but the decision is unsurprising for those who expected the shifting approach to vaccines to have an impact on vaccine makers. Biotech firm Moderna has also announced similar cuts across its organization amidst declining vaccine sales, with an estimated 10% of its workforce set out on the chopping block.
“A demerger will allow autonomy to set an independent strategic direction, including capitalizing on potential opportunities that may arise in a highly dynamic vaccines market, as well as reducing complexity, making the business more agile and efficient to manage,” CSL said in its official release. Distancing itself from vaccine development may be the company’s solution to shifting market sentiments, but it does give rise to questions about the profitability of the research and development of vaccines.
The CSL Layoffs Reignite Conversations Around the New Era of Work
The decision to conduct layoffs is expected to be the most strenuous for employees, many of whom are likely “job hugging” and holding on to work to make it through a year that appears centered on cutting costs and coworkers. “We will increasingly depend on a more optimal mix of internal capabilities and external partnerships to build and deliver our R&D pipeline,” a CSL spokesperson told Fierce Biotech in July. “This will require a smaller global internal workforce in the future.”
The shift away from running operations with a large-scale internal workforce is not exclusive to CSL or even the biotech industry. From tech giants to financial institutions, we are witnessing a gradual migration towards small-scale, specialized workforces, which could mean the availability of fewer work opportunities. The re-emergence of startup culture could see this trend balanced out by a larger variety of employers, however, employees remain fearful regarding the future of work.
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