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Amid uncertain future for vaccines business, Novartis to lay off 54 in Emeryville

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Novartis Vaccines & Diagnostics Inc. will lay off 54 employees in Emeryville next month as it concentrates more on diagnostics and less on vaccines research and development.

But the future of the division — particularly the vaccines business that was built around the old Chiron Corp. — appears uncertain.

Genetic Engineering & Biotechnology News reported Friday that the Swiss-based company will cut jobs in vaccines research, global legal, information technology, human resources, finance and procurement. Those employees reportedly will be offered jobs at other Novartis locations, including the vaccines and diagnostics division's Cambridge, Mass., headquarters, the company said in an emailed statement Friday to the San Francisco Business Times.

About 900 people are employed by Novartis in Emeryville.

"Novartis plans to strengthen the focus of the Emeryville site on its diagnostics business and will continue its operations there related to pharmaceutical and medical research," the company said in its statement.

But the vaccines and diagnostics business, among other Novartis units, could be divested, Fierce Biotech reported.

Bernstein Research analyst Tim Anderson wrote in a note to investors, Fierce Biotech reported, that Novartis CEO Joe Jimenez "seemed to acknowledge that (Novartis') consumer health, animal health, and vaccines & diagnostics businesses are on the block. It seems that Novartis will be making final decisions with those units fairly soon."

Novartis bought Chiron — one of the Bay Area's early biotech players — in 2006. The vaccines and diagnostics unit reported higher sales in the first half of this year yet had an operating loss of $240 million. It had a $250 million loss for all of 2012.

Ron Leuty covers biotech, higher education and China for the San Francisco Business Times.