Novo Nordisk will lay off about 400 employees at its Bloomington, Indiana, production facility in early May, according to an April 1 announcement. The company said it will continue investing in the site and expects to retain around 1,400 staff members after the reduction.
The move comes as Novo Nordisk's clients have reported positive developments with the U.S. Food and Drug Administration (FDA) and a return to routine manufacturing at the plant. Despite these improvements, Novo is adjusting its workforce amid slowing sales growth in its GLP-1 drug franchise and broader cost-cutting efforts that led to approximately 9,000 job cuts last year.
Novo Holdings acquired the Bloomington facility when demand for GLP-1 drugs Ozempic and Wegovy exceeded supply. The site was previously owned by Catalent, a contract manufacturing organization (CMO), which meant Novo inherited existing customer contracts as part of the acquisition.
The facility faced quality issues that prompted the FDA to issue warning letters late last year, citing concerns such as inadequate investigations into contamination incidents. Scholar Rock CEO David Hallal said during a recent Barclays event that communication between Novo and the FDA improved significantly after his team facilitated a meeting with regulators in November of last year. "Progress has been 'extremely rapid' since Novo met the FDA," Hallal said.
Following remediation efforts and meetings with regulators, Scholar Rock refiled for FDA approval of its spinal muscular atrophy drug candidate apitegromab this week. The new filing includes both the Bloomington site and an additional fill/finish facility not present in previous submissions. Hallal told analysts that this decision reflects "significant progress" at Bloomington and aligns with guidance from federal regulators.
Analysts from BMO Capital Markets commented that Scholar Rock's decision may indicate either an imminent resolution of past issues or confidence in commercial readiness due to support from a second fill/finish location. Including two sites provides flexibility for future regulatory approvals related to apitegromab.
