Layoffs in the US: what is going on with genomics companies?

Just five months into 2025, and a string of layoffs has already come down on the genomics space. More than 25 genomics companies have shed several workers since the year began, many of them facing the brunt of a financial downturn. 

Prime Medicine workers face 25% redundancies 

The latest biotech to pink slip employees is Massachusetts-based company Prime Medicine, with a 25% slashing of its workforce, disclosed by the U.S. Securities and Exchange Commission (SEC) yesterday. The layoffs were compounded by the resignation of the gene therapy company’s chief executive officer (CEO), according to the SEC report. 

But what may come as a bigger shock is that it has put a pin on developing its only clinical candidate, the gene edited PM359 for chronic granulomatous disease (CGD), a genetic disorder that disrupts the immune system’s ability to fight off certain bacteria and fungi. Instead, the biotech will switch to developing its preclinical liver program as it looks for other drug developers to move PM359 ahead.

This is unexpected, as the gene-edited drug just reaped positive results in a phase 1/2 trial, marking the first time the safety and efficacy of prime editing has been proven in the clinic. Prime Medicine is pioneering prime editing, which is a kind of precision gene editing technology that acts as a search-and-replace tool to edit the DNA. The therapy led to 58% DHR positivity –  a diagnostic test for CGD – levels that are deemed to be potentially curative. The therapy also maintained a safe profile, and no adverse effects occurred, making the pause in its development all the more baffling.

10x Genomics and Lexeo Therapeutics announce budget cuts amid funding woes

The month of May has not been great for researchers at genomics companies. Another notable one that canned workers was California-based 10x Genomics, a company that has roots in former DNA giant 23andMe. The gene sequencing company culled 8% of its staff last week. Much of this is owed to federal funding cuts under the Trump administration that have wiped out grants and billions of dollars from research. Around 40% to 50% of 10x Genomics’ revenue was backed by academic and government research funding, but since caps on indirect costs for research were declared in February, things took a turn for the worse and stocks fell by 14%.

On the same day that 10X Genomics announced that it had let go of its workers, New York-based Lexeo Therapeutics did the same. But Lexeo’s case is a little different. The gene therapy developer expressed that it wants to hone in on its clinical franchise, which includes LX2006 for cardiac Friedreich’s ataxia (FA) – a life-threatening complication of FA, which is a rare, genetic condition that causes progressive damage to the nervous system. The gene therapy brought in compelling phase 1/2 results in April.

So, it is relocating money from its preclinical candidates to its clinical program, $20 million to be exact. As a result, it has axed 15% of its team. 

Genomics specialists Mammoth Biosciences, Korro Bio, and Vor Bio carry out layoffs

Earlier this month, Mammoth Biosciences in California, known for its CRISPR platform, dismissed 24 of its employees, citing “strategic alignment,” according to a report by Fierce Biotech. The genomics company’s preclinical pipeline is led by MB-111, a CRISPR therapy that it hopes to bring to the clinic soon to treat familial chylomicronemia syndrome, a rare inherited disorder that causes a heightened level of certain fats in the blood.  

Similarly, other genomics players, such as Massachusetts-based Korro Bio and Vor Bio, carried out steep workforce cuts. The RNA editor Korro Bio shaved off a fifth of its workforce in order to give the company enough time to expand the clinical study of its lead candidate KRRO-110, an RNA-editing oligonucleotide drug for alpha-1 antitrypsin deficiency (AATD), a genetic disorder that can cause lung and liver disease, to push three of its candidates into the clinic by the end of 2027, and advance a collaboration with pharma giant Novo Nordisk before it runs out of cash.

“Streamlining the organization is essential to enable Korro’s long-term success,” said Todd Chappell, chief operating officer (COO) of Korro, in a press release, addressing the cost-cutting measures the company has taken.

As for Vor Bio, it is at its last stop as it has cast out 95% of its team. Now, eight people are left to divest or sell off the company, explained a press release. The company said that a “challenging fundraising environment” was partly to blame. 

U.S. genomics industry layoffs: are budget cuts and financial uncertainty to blame?

Much of this is credited to trying financial times. After funding freezes and cuts were imposed in March as part of a DEI (diversity, equity, inclusion) purge, the U.S. National Institutes of Health (NIH) – the world’s largest public funder of biomedical research – slashed nearly 800 projects, and several top officials overseeing food and drug safety in the country were laid off last month in efforts to slim down the workforce by 20,000 health workers. 

Michelle Hoffmann, executive director of the Chicago Biomedical Consortium, pointed out that these cuts are cutting off patient access to potentially life-saving treatments and stifling innovation. 

“Federal budget cuts are throttling innovation at its source. Early-stage academic research – the engine room of breakthrough science – is being starved of the support it needs to turn ideas into technologies,” said Hoffmann.

This has had ripple effects in the biotech industry, with increasing layoffs and dried-up funds.

“Research institutions are experiencing staff layoffs, project terminations, and a significant loss in training opportunities for early-career scientists, thus eroding and stalling innovation. In the longer term, we risk losing a generation of scientific talent and ceding leadership in global biomedical research,” said Hoffmann. “Over time, these pressures could degrade the U.S. innovation ecosystem, diminish public trust in science, and delay the development of life-saving medicines.”

The healthcare and biotech industry is no stranger to layoffs and financial turmoil. In 2023, the industry was forced into a venture capital drought, with financing for biotech companies down by 48.6% compared to 2021, when the sector was booming. Later, the initial public offering (IPO) market plummeted as market volatility grew amid the collapse of the Silicon Valley Bank.

But this time around, the uncertainty has been compounded by rising uncertainty around trade tariff policies, especially as certain American biopharmas relied on foreign manufacturing.

While investors have an appetite for risk, they tend to prefer market certainty, explained an article by MedCity News. “They can pay for disruption as long as markets are not disruptive,” the report read.

And specifically in the genomics space, it looks like they are navigating this disruption through layoffs. “Firms in cell and gene therapy are streamlining amid strategic shifts or financial strain,” according to an article by Gene Online.

CAR-T developers slash jobs in 2025

For instance, several CAR-T cell therapy companies have caused redundancies. CAR-T cell therapy is a cancer treatment that genetically modifies a patient’s immune cells by introducing a gene into these immune cells. The gene instructs them to produce a protein called a chimeric antigen receptor (CAR), which acts like a hook to latch on to cancer cells and kill them.

So far this year, three CAR-T companies have slashed several jobs, all of which are situated in California. Cargo Therapeutics began the year by dumping its lead candidate as well as 50% of its staff. This was due to its lead CAR-T cell therapy firicabtagene autoleucel causing serious side effects in patients in phase 2 trials. Then, in March, it shelved its CAR-T therapy CRG-023 and culled nearly 90% of its workforce.

Similarly, Caribou Biosciences also trimmed down its workforce by 32% last month and ditched its leukemia candidate CB-012, an allogeneic anti-CLL-1 CAR-T cell therapy that had previously snagged fast track designation from the U.S. Food and Drug Administration (FDA).

While Caribou let go of its candidate because “additional data” is required to advance the program, Cargo binned its candidate because of safety concerns, as many CAR-T drugs are linked to toxicities, the FDA warns.

Lyell Immunopharma was another California-based CAR-T cell developer that led layoffs. It fired 73 employees and shut down its ImmPact production facility, a mere year after it bought cell therapy company ImmPact Bio.

Cost-cutting in biopharma: workforce reductions only worsening

The genomics-wide cuts kicked off in January with California-based gene editor Scribe Therapeutics culling 20% of its staff, followed by Passage Bio, Repare Therapeutics, and Intellia Therapeutics, all letting go of employees. Passage slashed 55% of jobs, whereas Intellia axed 27%. Intellia also discarded its gene editing program NTLA-3001, which was being evaluated to treat alpha-1 antitrypsin deficiency-associated lung disease.

Several other genomics companies followed suit in the U.S., such as California-based gene therapy company Encoded Therapeutics, Massachusetts-based tRNA company HC Bioscience, cancer therapeutics developer Tango Therapeutics, and genetic medicine developer Entrada Therapeutics, which chopped off 25%, 20%, and 20% of their teams, respectively. 

Meanwhile, Swiss pharma giant Roche revealed severe cuts to its gene therapy subsidiary in the U.S., Spark Therapeutics, which it bought to fortify its gene therapy cohort nearly six years ago. More than 300 jobs are on the chopping board this year, questioning whether the gene therapy entity will even exist after redundancies, as the rest of the staff will be integrated into Roche, according to a Fierce Biotech report.

The genomics layoffs in the U.S. are a stark contrast to biopharmas headquartered in the rest of the world this past year, with Japanese pharma Kyowa Kirin sacking 52 employees in New Jersey and Swiss-based gene editing specialist CRISPR Therapeutics laying off an undisclosed number of workers. It can only be assumed that the difference is owed to financial uncertainty and funding tumult in the U.S., which does have a global impact. 

While many of these biotechs plan to stay afloat with these cost-cutting measures, startups like Cargo Therapeutics and Vor Bio are forced to sell, divest, merge, conduct a reverse merger, and whatnot. But it will only be a matter of time before we see how things transpire for the industry at large.