Pfizer to shutter Boulder R&D operations

BOULDER — Pharmaceutical giant Pfizer Inc. (NYSE: PFE) will shut down its research and development facility in Boulder in the coming months. 

The move, first reported by Endpoints News, will result in an undisclosed number of job cuts. The facility at 3200 Walnut St., which Pfizer took over in 2019 as part of its $11 billion acquisition of Boulder-based oncology company Array BioPharma Inc, has focused mainly on oncology drug research and employs about 300 workers, according to Pfizer’s website. 

“Pfizer started a process in early 2023 to externalize the Boulder research operations. Although we received some investor interest through this process, we have made the difficult decision to wind down Boulder research operations by the end of Q2 2024,” a company spokesperson told BizWest in an emailed statement. “Pfizer will retain a site presence in Boulder for colleagues not affiliated with our research activities to continue working.”

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Pfizer telegraphed its intent to wind down R&D operations in Boulder last fall when the company laid off an undisclosed number of workers at the Walnut Street facility.

“We’d been apprised of it and we understand that they’ve been considering options for outsourcing the research operations,” Boulder Chamber CEO John Tayer told BizWest on Tuesday afternoon. 

Pfizer, a multinational pharmaceutical company with its North American headquarters in New York, “continues to hone its R&D footprint and focus on areas where its capabilities are differentiated, aiming to reduce cycle times further through optimization of its end-to-end R&D operations,” the company said in an October 2023 email to BizWest after the previous round of layoffs were reported. “As part of this effort, we have made the very difficult decision to reduce the footprint of our Boulder organization and to transition some research programs to other facilities. Our efforts to implement these strategic changes will result in colleague impact at our Boulder, Colorado, site.”

Pfizer declined to specify how workers would be affected by the R&D wind down in Boulder. “Unfortunately part of the effort will result in some job loss for Pfizer,” the spokesperson said. “We are still working through the details.”  

As of Tuesday afternoon, Pfizer had not filed a Worker Adjustment and Retraining Notification Act notice with the Colorado Department of Labor and Employment. WARN notices are required when company layoffs reach certain thresholds. 

While Pfizer’s decision to stop R&D operations in the city is a blow, especially for the laid-off workers, it doesn’t necessarily reflect a diminishment of Boulder’s growing reputation as a national life-sciences hub, Tayer said. 

“In the Boulder market, one of our great strengths is the wide diversity of both R&D and manufacturing” operations in the life-sciences sector, he said, and laid-off workers could be quickly recruited by other local biotech companies. 

“It obviously depends on their specific skills and research focus, but we see other companies continue to grow their operations here,” Tayer said. 

When Pfizer acquired Array BioPharma about five years ago a Pfizer spokeswoman told BizWest that the company had no intention of reducing headcount at the former Array office or moving employees to other research sites across the country.

Beyond the human impacts of Pfizer’s move to shutter its Boulder R&D facility, the move is likely to have commercial real estate ramifications across the Boulder Valley, which has seen a boom in recent years of developers and investors building flex-industrial spaces and repurposing existing offices in an attempt to woo biotech tenants. 

Compared to other life-science hubs such as the San Francisco Bay area or Boston, “Boulder is a small market,”  Becky Gamble, CEO of the brokerage Dean Callan & Co., told BizWest this week in an interview about the state of the Boulder Valley’s commercial real estate landscape. “So when you have a significant deal size or a notable tenant that comes into the marketplace, that can change the dynamics pretty quickly.” The same concept applies when a major tenant such as Pfizer leaves the market.

In 2021, after Pfizer had settled into the Walnut Street facility, Atlanta-based investment firm Invesco Ltd. bought the four-building, 151,384-square-foot office and lab campus from Pfizer’s then-landlord Tritower Financial Group LLC for $99 million. When the property changed hands, Pfizer said it had extended its lease on Walnut Street but did not specify the terms or length.

Assuming Invesco, representatives of which did not immediately respond to requests for comment Tuesday afternoon, doesn’t have a new tenant lined up to move into the Walnut Street space, the Pfizer facility could hit the market during a period when a host of other Boulder Valley biotech-centric facilities — from Louisville’s Redtail Ridge to the Coal Creek Innovation Campus in Downtown Superior to Flatiron Park in east Boulder — are making their way through the development pipeline.

As a result of macro-economic factors such as a reduction in venture capital accessibility, some life-sciences companies have “struggle(d) to get funding,” Gamble said. “I think the VC market is still slow,” which affects biotech companies’ abilities to take over new offices, manufacturing plants and R&D facilities.  

“We went from having nothing when the demand was crazy to having product” being developed in a demand environment that has somewhat cooled, she said. “You’ve got some of these projects that have been completed and are now ready for that demand to return.”

The Colorado BioScience Association, through its recently launched Colorado Hub for Health Impact initiative, is partnering with nearly two dozen companies, municipalities and economic-development groups — many of which call the Boulder Valley home — to boost the region’s biotechnology profile around the nation and globe in an effort to attract life-sciences companies.

The 22-member consortium will not only serve as a marketing arm for Colorado’s biotech sector but will also work with site selectors to help find the right home for companies relocating to or expanding in the state, and it will assist firms in identifying and securing incentives and investment, according to Colorado Hub for Health Impact leaders.

According to CBSA, the U.S. Highway 36 corridor between Denver and Boulder is home to almost one-third of Colorado’s biotech companies and research institutions. Nearly 17% of industry is clustered in Northern Colorado, with the remainder mostly concentrated around Denver and Colorado Springs.