fb-pixelBiotech layoffs 2023: Boston real estate market is real casualty Skip to main content
the big idea

The once-hot market for biotech jobs and lab space has cooled. What now?

Boston’s struggling biotech industry
WATCH: “The Big Idea” columnist Kara Miller on why the local biotech sector is losing jobs and what it means for the industry’s future.

When Crystal Shih Byers left her job at Novartis in 2020, she was excited to make the leap into a smaller startup.

Byers had spent almost nine years at Novartis, most recently helping lead a group that worked on gene therapy. But pharmaceutical companies are large and complex, and she craved more immediate impact. “I was looking for a place where I could be in the room,” she says. She wanted more autonomy, and to feel like her work would reach patients sooner.

At the time, biotech startups were rolling in cash and seeking to capture some of the magic that had fueled Moderna’s meteoric rise. They handed out lots of logo-embossed swag. “Investors were putting a lot of money into stupid science,” Byers says. “There were a lot of companies that lasted for a lot longer than I thought they would on very little data.”


So Byers chose carefully, joining a company she believed in: Ascidian Therapeutics. Then, in the summer of 2022, as the good times began to slow, she was laid off. She quickly found another job as a senior director at Moment Bio, only to be laid off again a few months later.

While much of the economy sails along — the national unemployment rate is under 4 percent, and the Massachusetts unemployment rate is under 3 percent — the carnage in biotech has been real and painful. And it’s not just affecting the sector’s workforce, it’s punching a hole in Greater Boston’s real estate market.

The unrelenting job cuts range from marquee names like Biogen and Takeda to smaller firms like Aileron Therapeutics and EQRx. After more than 100 rounds of layoffs last year, according to Fierce Biotech, 2023 has already brought dozens more. And many of those being laid off — like Byers — are deeply trained scientists with PhDs.


Venture capital flowing to Massachusetts companies dropped from $13.7 billion in 2021 to $8.7 billion in 2022, and it’s running slightly lower this year, according to the Massachusetts Biotechnology Council. Meanwhile, the window for biotechs going public seems to have all but closed.

In biotech, the job cuts have been unrelenting, ranging from marquee names like Biogen and Takeda to much smaller firms like Aileron Therapeutics.Adam Glanzman/Bloomberg

But unless you work in life sciences, the turmoil has been somewhat obscured by high-profile problems in other sectors: the collapse of Silicon Valley Bank, large-scale layoffs at Meta and other tech giants, and the implosion of FTX in crypto.

You could argue that it is an inevitable hangover after years of partying. Kendalle O’Connell, CEO and president of MassBio, says that “there was a general understanding that we couldn’t ride that high in perpetuity.”

“There was this huge bubble that happened in biotech during COVID,” says Amanda Wagner, CEO of Immunitas, a Waltham-based firm. Immunitas, like many other companies, “streamline[d] programs and headcount” and is now in a substantially stronger financial position, Wagner notes.

Nick Amarante, senior vice president at the corporate real estate adviser Hughes Marino, sees the same downturn through the lens of real estate, where empty lab space is piling up far too quickly.

At any given time in 2021, he says, there were companies in the market seeking to lease between 6 and 8 million square feet of lab space in Greater Boston. Since then, demand has “fallen off a cliff.” Companies are currently seeking between 1 and 1.5 million square feet, which, he says, is below pre-pandemic levels.


Instead of tenants clamoring for labs, landlords with labs are clamoring for tenants. And they are cutting some very generous deals. But landlords may be in for even more pain ahead.

“Unfortunately, it might get worse before it gets better,” Amarante says, “in terms of company shutdowns versus new company formation.”

He worries that by early next year, a new wave of companies will run out of cash. These are companies that may have gotten their initial funding in 2020 or 2021, but don’t have strong enough drug pipelines to support a new round of funding.

And more than 15 million square feet of additional lab space is scheduled to get built out in Greater Boston over the next three years, Amarante says. “The key point,” he notes, “is that only about one-third of this is pre-leased.”

A couple of years ago, constructing lab space seemed like a great bet. Now, construction costs are high and biotechs are more likely to be cutting back on space than ramping up.

“Many companies went public before they were really ready,” says Wagner, the Immunitas CEO. “A lot of new companies got started on science that was very, very early. And when COVID started to wrap up a little bit, a lot of those companies were reading out data. And the market really collapsed underneath them.”

She says that investors now want companies to focus on “streamlining pipelines and streamlining headcount,” meaning that all available cash should be spent on the most promising research. And that can mean getting rid of anyone who works on research that might take longer to bear fruit.


Kara Coluccio, a managing partner at Perspective Group, who helps biotech companies recruit high-level executives, says “there’s a lot of fear” in the industry.

She notes that the focus on controlling costs has taken a toll. “I think it’s a lot of fatigue. I think executives — in particular, CEOs — are constantly thinking about fund-raising. They’re constantly thinking about informing Wall Street, or they’re private and they’re managing where their next dollar’s going to go.”

Kara Coluccio, a managing partner at Perspective Group, says “there’s a lot of fear” in the industry.Jessica Rinaldi/Globe Staff

Coluccio says that during the pandemic, “our business — and all of our competitors — couldn’t keep up with the volume of work to recruit executive teams. We were under siege trying to help venture firms and investors and private companies that had just gone public.”

As a result, there were a lot of first-time CEOs and chief medical officers. But as the market has cooled, the bar has gotten much, much higher.

“Two years ago, finding an oncology chief medical officer, or somebody who had experience with drug development in oncology, was almost impossible. And you had to almost always take a first-time CMO,” Coluccio says. “Today, you could probably create a slate of five [candidates] and they all are experienced chief medical officers.”

For Omar Ahmad, the fact that the bar is rising may be a good thing. Ahmad has worked at three biotechs since 2019, and is now vice president of medicinal chemistry at Kestrel Therapeutics in Boston. And though he has seen the toll that layoffs can take, he believes the bursting of the biotech bubble was, in a sense, necessary.


Having cash in short supply, he says, “weeded out the biotechs that really didn’t have a plan and were just bound to fail anyway. So that has actually helped consolidate the money and directed it towards biotechs that actually have something real.”

Coluccio and Wagner believe the industry might be turning the corner. But plenty of investors are still on the sidelines, waiting to deploy cash. Instead of the FOMO (fear of missing out) that characterized 2020 and 2021, they now fear anything that seems too risky.

O’Connell thinks that the state is well positioned for a recovery, with 32 percent of biotech venture money heading to Massachusetts-based companies this year. “We’re in this period of ‘wait and see,’” she says. “And everyone wants that crystal ball to know when things will loosen up and get moving again.”

The Novartis Institutes for BioMedical Research in Cambridge.Peter Vanderwarker

Follow Kara Miller @karaemiller.