Locals were irate when the drug giant Pfizer closed its 70-hectare research and development (R&D) facility in Ann Arbor, Michigan, in 2007. T-shirts sporting the word 'Pfired' appeared on the streets; the governor called the lay-offs a “punch to the gut”; and the state of Michigan pledged US$1 million to help the 2,100 displaced workers find new jobs.

The pharmaceutical industry has faced major upheaval in recent years, with a disappointing drug pipeline, major revenue losses as patents expire on blockbuster drugs, and a spate of mergers and acquisitions. From 2006 through to the first quarter of 2012, some 263,000 positions have been eliminated from major pharmaceutical and large biotechnology companies, says Kenneth Getz, a senior research fellow at the Tufts Center for the Study of Drug Development in Boston, Massachusetts. R&D operations have accounted for 7–10% of the lay-offs since 2008, which have been only partially offset by new hiring, endangering what was once a stable source of jobs for life scientists and chemists.

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But despite such convulsions, there are positive signs in the job market. In the Ann Arbor region, dozens of contract-research organizations (CROs), many founded by former Pfizer employees, offer outsourced services ranging from medicinal chemistry to toxicology testing. The abandoned Pfizer facility has been reborn: the University of Michigan bought it and now uses some of it as research facilities and rents out another part to Lycera, a biotechnology spin-off from the university that partners with pharmaceutical company Merck and employs some former Pfizer scientists.

“What we are seeing in front of our eyes is the slow-motion implosion of the big pharma companies as we know them, and the rebirth of the industry with different models and in different forms,” says Bernard Munos, founder of the InnoThink Center for Research in Biomedical Innovation in Indianapolis, Indiana.

Researchers looking for work in this environment need to adapt their skills to an industry in flux, says Munos, and consider how to use their experience to secure a new type of job. They should also be aware that laid-off researchers may have to take jobs at lower salaries at CROs or biotechnology start-ups, or in other industries. In short, to weather the cuts — which show no signs of abating — pharma employees and new graduates “are going to have to hustle”, says Munos.

R&D Breakdown

In the face of declining pharmaceutical revenues, a variety of strategies has emerged to increase productivity and decrease costs. Companies such as GlaxoSmithKline, headquartered in London, have broken up research departments into smaller, more nimble units, and many firms are outsourcing R&D that would once have been done in-house. Meanwhile, research areas have been cut back. For example, Novartis, based in Basel, Switzerland, has reduced development of drugs that affect the central nervous system, considered a high-risk, expensive field (see Nature 480, 161–162; 2011).

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Firms, including Novartis, are shifting operations to areas such as Boston, where they can mine academia and biotech companies for early-stage discoveries, and China, an emerging market with a growing scientific workforce. Outsourcing may account for much of the net workforce reductions over the past several years, which occurred even as total investment in R&D by major pharmaceutical and biotechnology companies increased. An estimated 41,275 workers were employed in pharmaceutical- and biotechnology-industry R&D worldwide in 2010, down from 50,750 in 2008, according to the Tufts Center (see 'Outsourcing on the rise').

The closures affect all workers, from laboratory heads to technicians. But some jobs seem to be more vulnerable than others. When Pfizer, which is based in New York City, laid off employees in Ann Arbor, it offered jobs to hundreds of them at other locations. Most were scientists with transferable skills, such as computational biologists, or worked in hot areas such as oncology, says John LaMattina, who oversaw the lay-offs as head of global R&D at Pfizer and is now a senior partner at Puretech Ventures, a life-sciences venture-capital company in Boston. Specialists in waning fields are often most vulnerable, he says.

Bench scientists who work in the earliest stages of drug research may also be at high risk, as many pharmaceutical companies turn to academia and biotechnology companies for leads. “Major R&D organizations within big pharma have just been slashing without a lot of regard in drug discovery,” says John Archer, founder of Catalyst Advisors in New York City, which recruits executives for pharmaceutical and biotechnology companies. People who work in clinical research and regulatory affairs seem to be better buffered from lay-offs, he says.

Staying ahead

It is difficult to trace where the jobs are going, but a lot of people do manage to find work. In the United Kingdom, for instance, about 2,000 chemists at pharmaceutical companies were laid off last year, estimates Charlotte Ashley-Roberts, a careers adviser at the Royal Society of Chemistry, based in Cambridge, UK. More than 85% found jobs within three months, and 60% in chemistry. “You are starting to see a whole different cadre of opportunities,” says John Arrowsmith, a life-sciences adviser at Thomson Reuters in London.

Many former pharmaceutical researchers are heading to CROs (see 'Prepare and contrast'), which have been growing steadily in the United States, Europe, India and China in recent years (see Nature 466, 280–281; 2010). In 2010, 46,550 people were employed in R&D at CROs worldwide, up from 42,687 in 2008, estimates the Tufts Center.

People with skills beyond bench work are moving into consultancy, as experts in areas such as regulatory affairs, clinical-trial management and biostatistics (see 'Use your skills'). But there are no hard numbers on who is taking this route — or on how many consultants are effectively underemployed.

Yet other workers are retooling their skills for related industries that remain strong, including development of medical food (such as 'gut-healthy' yogurt), medical-device engineering and biomanufacturing, says Clifford Minz, founder of BioInsights, a career consultancy in Princeton, New Jersey. Patent specialists and medical writers are also in demand, he adds.

The great leap sideways

Alex Flood is a former pharma researcher who has successfully made the transition to one growing niche sector: non-profit work. He “cut his teeth” at Wyeth and weathered that company's 2009 buy-out by Pfizer, but for many years he had aspired to a job in public health. Since 2010, he has been employed at PATH, a global-health non-profit organization in Seattle, Washington, where he works on vaccine stabilization — by, for example, devising ways to keep vaccines fresh over time. To find new work, “you have to be flexible”, says Flood, who adapted his pharma training to his new job.

Peter Corr, co-founder of Celtic Therapeutics, a private-equity drug-development firm in New York City, hires senior and junior pharmaceutical professionals with a wide range of experience, from outsourcing to finance. He was head of science and technology at Pfizer until 2006, and says that it helps if candidates have an understanding of the whole drug-development pipeline. “Spend some time in your off hours in other parts of the company,” he advises potential applicants. For example, bench scientists should expand their skill sets by learning about regulatory affairs or business development. Being open to relocation also helps, says Archer, given the geographic shifts in the industry.

The best candidates show passion for what they do and have taken on challenges, says Corr. “You see people who are moving to gain new experiences,” he says. “These people are constantly stretching themselves.”