Sun Pharma Advanced Research to Cut Workforce by 40% in Cost Optimisation Push

Sun Pharma Advanced Research Company (SPARC) officially announced on Thursday, January 8, 2026, a massive restructuring program aimed at stabilizing its balance sheet and pivoting toward a “hybrid” R&D model. The plan includes a 40% reduction in its global workforce, with the U.S. operations facing an 80% staff cut as the company scales back its overseas in-house research.

The move comes as the clinical-stage biotech navigates a difficult funding climate and manages an outstanding debt of approximately $46 million. By shifting from a fully captive (in-house) setup to a more flexible model that utilizes third-party R&D partners, the company expects to generate annual savings of roughly $10 million.

Laboratory Consolidation in Gujarat

A key pillar of the “lean” strategy is the consolidation of its fragmented research footprint. SPARC is shutting down its R&D labs at the Mahakali site in Mumbai and the Makarpura site in Vadodara. All in-house R&D activities will now be centralized at the existing Savli and Tandalja hubs in Vadodara.

While core corporate functions remain in Mumbai, the shift emphasizes the company’s intent to lower fixed overheads while maintaining its R&D focus on the specialized talent pool in Gujarat. To facilitate these third-party services, SPARC’s recently formed subsidiary, Genokine Biotech Limited (incorporated July 2025), is expected to play a central role in managing R&D service lines.

The “Sezaby” Lifeline

Despite the personnel cuts, SPARC’s clinical outlook has been significantly bolstered by a legal breakthrough in the United States. In December 2025, the U.S. District Court for the District of Columbia ruled in favor of SPARC, stating that the FDA’s withholding of a Priority Review Voucher (PRV) for Sezaby (phenobarbital sodium) was contrary to law.

The PRV is a highly lucrative asset. In the 2025-2026 market, these vouchers typically sell for between $90 million and $110 million. If SPARC successfully secures and sells the voucher, the proceeds would be more than enough to retire its $46 million debt entirely, providing a substantial “war chest” for its prioritized assets, SCD-153 and SBO-154, as they enter key trial phases in 2027.

Summary

SPARC is executing an aggressive 40% workforce reduction and lab consolidation to achieve $10 million in annual savings. Facing a $46 million debt, the firm is pivoting to a hybrid R&D model centered in Vadodara. However, the recent U.S. court victory regarding the Sezaby Priority Review Voucher—valued at up to $110 million—offers a potential financial reset that could fund the company’s clinical pipeline through 2028.

Frequently Asked Questions (FAQs)

Q1: Why is SPARC cutting 80% of its U.S. staff? 

The company is moving away from an expensive, fully-in-house R&D model in the U.S. to a “hybrid” model that uses third-party partners to lower fixed costs.

Q2: Which lab sites are closing? 

R&D operations at Mahakali (Mumbai) and Makarpura (Vadodara) are being integrated into the Savli and Tandalja campuses in Vadodara.

Q3: What is the value of the Sezaby PRV? 

Recent market transactions for Priority Review Vouchers range from $90 million to $110 million. SPARC plans to use these potential proceeds to clear its debt.

Q4: Is Sun Pharma supporting SPARC? 

Yes. Funding for the 2027-28 window is expected to rely partly on promoter-supported debt, ensuring SPARC continues as a “going concern” during its restructuring.