ooOOoo, the chemists are getting restless

Last Friday, Derek Lowe posted the latest rumors on Amgen.  The pointy haired bosses are saying euphemistically loaded code words for liberating the wage slaves:

Amgen is out today speaking the sort of language that we’ve all come to fear. It appears that the local Ventura County Star picked up some rumblings from inside the Thousand Oaks headquarters, and when they asked the company about it, they got this:

“We are currently evaluating some changes within our Research & Development organization to improve focus and to reallocate resources to key pipeline assets and activities. . .”

Been there, done that.  The whole day at Amgen was wasted with scared shitless labrats floating from cubicle to cubicle running down the options.  Those who weren’t constructing elaborate scenarios were furiously updating their CVs, searching for their publications and slapping together presentation slides.  Lots of networking going on.  “Heeeey, how are you doing?  Haven’t talked to you for, what is it now?  Five years?  Oh, I’m doing fine.  Working at Amgen.  Yep, great site.  How are the kids?  Really?  High school already?  Doesn’t time fly?  Is it true Satanaco just made you director of flarnjarn chemistry?  How’s that going these days?…”

Thinking back on it, there is a certain pattern to these announcements.  They occur roughly a year after the email about the multimillion dollar contract the company just signed with a consulting firm (located more frequently in Massachusetts, hmmm…).  So, be on your guard, guys.  Don’t wait until the big announcement to bug out.  Do it as soon as you hear the consulting firm is studying your discovery process.

For the past 10 years, chemists, who tend to be introverted types, watched as their work environment disappeared lab by lab.  At first, they were able to jump around locally.  Then all hell broke loose in 2008 and the layoffs came like a blitzkrieg.  There is absolutely no relief, no place to go and no security.  No sooner have you unpacked your new clean labcoats in the new company before there’s a merger announcement or a restructuring and, once again, you have to figure out if you can afford the house *and* the small apartment you’ll be forced to live in during the week in Massachusetts while your employed spouse works in your former state of residence.

The chemists grumbled but took it.  But now that so many of them are out of work, some of us permanently as far as we can tell, the labrats are getting mad.  Here’s a promising comment:

“The reality is that we have all gotten to the good old days when you could stay with the same company with job security. Those days are gone! Do not blame your management! Face the reality. For the chemists, why you think you would be entitled to a good job if the need is not there for your services?”

Yeah, I’ve been thinking about that lately in light of the last nine months in the world. Sure, chemists may be smart and resourceful and maybe can deal with getting laid off a lot, but most humans aren’t. Most humans do expect relative job security and certainty for the future. A lot think they are entitled to it. Don’t believe me? Look at Tunisia, Egypt, Syria, Greece, Spain, and now New York. It all sounds fine to say that we need to adjust to the new market, but I’m guessing that in the future the financial industry will have to throw billions at people to keep them in boring, steady jobs with a degree of future certainty just so they don’t tear out a banker’s throat. Much as Saudi Arabia is doing now by flooding Egypt and Yemen with billions in the futile hope that the hunger and unrest doesn’t spread.

I’m sorry, but I don’t think humans are evolved enough for today’s market. Maybe in a few thousand years… but the instability and uncertain future has obviously risen beyond what the human species as a whole can support with the current gene mix. Too many people want a certain stability on a primitive level. This whole business with the Euro collapsing and the Arab world imploding/exploding will lead to a lot more problems for Pharma (and not only them) in the future.

Sad but true.  Human beings have not sufficiently evolved to give up their food and housing addictions.  If we were, getting laid off repeatedly would be much more pleasant than it is.   I must say that the image of bankers’ throats being torn out by a crowd of angry labrats gave me a momentary feeling of delight, sort of like a lion that has finally downed its prey and is ripping the esophagus out of the neck, like bloody banker steak tartare…  Where was I?  {{catching breath, straightening clothes, wiping chin}} And this comment from an Amgen Oldtimer tells the story of Amgen’s demise.  Substitute any well known biomedical research company for Amgen, it’s happened to all of them:

Yes Amgen was a great company. Under George Rathman it was an awesome culture. For about 15 years, early 80’s to mid-nineties, almost no one left. Attrition ran less than half industry standard. It was a vibrant, scientist driven culture of innovation. Team culture was strong, people supported one another, careers were nurtured, ethics were everyday stuff, not laminated speaking points. As a young scientist there, I awoke each day early and got off to work because my head was full of anticipation for the day.

The middle period was run by Gordon Binder. A decent man, but he set the seeds for future failure. He ran a tight ship financially, growing the company perfectly to beat estimates steadily, quarter over quarter, year after year. A lot of people got rich, but also complacent and no risks were taken with the revenue other than to support internal research. While that was a good thing, the senior team had lost some steam, and was also stubbornly resistant to the McKinsey minded management movement that was threatening all research organizations. While I think this was wise, lack of performance and suggesting no alternatives other than to do what we’ve always done led to the next disastrous phase.

Kevin takes over. In comes GE based performance systems [Jack Welch’s “rank and yank” that nurtured Enron as well], in comes BCG (Boston Consulting Group) lead restructuring of R&D processes to generate “seamless alignment”, in comes an attitude that R(esearch) only costs money. Team culture evaporates, those that can manage up well shift around from function to function, with success claimed for new initiatives before any measure of impending failure. Scientists who have clarity about the folly, and speak up, are shown the door. New “superstars” are hired that have no track record of success (but amazingly are all friends!), and that is still true now after a decade at Amgen. ESAs are over-promoted, Hematocrit pushed to high and the fall begins.

Management structures bonuses based on revenue, so Amgen buys Immunex and enbrel, which produces a lot of revenue, less margin, pays too much, but pads bank accounts. Stock falls, so management changes incentive at low price to be aligned with shareholders, taking more money out of the company. In the end, company sheds something like 40-50B in market cap, lays off employees while the CEO buys 2 corporate jets and takes home about $250MM. Amazing pay for shedding that much company value. Amazing lack of concern for employees and patients. Amazingly different company than George Rathman led.

Great company, once.

The anger isn’t limited to Wall Street but Wall Street had a significant role to play in the demise of research in this country.  And now, as one commenter noted, the flood gates are about to open to admit more foreign STEM workers because companies are whining that they don’t have enough well-trained workers in the US.  That might be motivated by Wall Street’s pressure for profits but the ultimate responsibility for reducing STEM professionals to low wage jobs with no security will fall on the president and Congress who don’t prevent the H-1B visas from flooding the system with cheap, expendable labor that can be sent back to Asia when the season’s over, like migrant workers rotating from lab to lab.

Obama should think about that. Chemistry used to be a good career.  The work requires a lot of education, technical skills and experience.  The salaries were decent if not spectacular compared to the corporate office purchasing administrators and sales reps.  Chemists paid their fair share of taxes and had nice houses in the suburbs where they sent their children to local schools and attended school board meetings.  They did demonstrations for kids at Science Fair night.  They coached soccer.  These are not the people you want to alienate in an election year.

Because these are the same people who may show up at a OWS site in a nearby park carrying signs like this:

One more thing:

Over at Craig Crawford’s Trail Mix (nice blog), there is a video of Matt Taibbi talking to Don Imus about Occupy Wall Street. I’ll see if I can embed the video. One thing that annoys me is Don Imus asking Matt if he thinks any of the occupiers even understand the banking issues. Condescend much, Don?? A lot of us have read Michael Lewis’ book The Big Short and can tell you exactly how securitization of mortgages work, what a tranche is and the difference between a CDO and a CDS. Yep, and we know the people at ratings agencies are unreliable at best, looking for jobs with the people they rate at worst. AND that the SEC did nothing about the concerns that were raised by some hedge fund managers. And that derivatives are not regulated to make them transparent. And that fund managers love their status and money and have very little interest or incentive to protect their clients’ pension funds. Is that enough, Don, or do you want more?

Jeez, he hasn’t aged well. He’s younger than my mom and looks about 10 years older. Ahhh, I see. Prostate cancer. That’s not good. Too bad I don’t do cancer drugs anymore…