Layoffs hit Philly biotech startup after being bought by Big Pharma

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At the end of June, the remaining 14 employees inside the Philadelphia-based Tmunity Therapeutics were expected to exit the Center City office of the once-promising biotech startup because their jobs were eliminated, public records show.

That’s because a pharmaceutical giant, which acquired the early-stage company in Philadelphia, had been consolidating its offices and shut down the Tmunity division.

California-based Gilead Sciences, a publicly traded pharmaceutical company, eliminated those positions inside Kite Pharma, its Santa Monica, California — based subsidiary that ran Tmunity, on June 30. Kite has an overarching goal to use cell therapy to treat and cure cancer.

Gilead manufactures its cell therapy products in California, Maryland and the Netherlands, records show. The company is headquartered in Foster City, California, and incorporated in Delaware.

As a publicly traded company, Gilead sells shares of its stock to individual investors, but it’s also part of the S&P 500 — that means individuals who have retirement accounts, whether through pensions or 401(k) retirement plans, may be invested in this business through the index.

Founded in 2015, Tmunity Therapeutics’ manufacturing operation was in East Norriton in the nearby Philadelphia suburb of Montgomery County. When visited by WHYY News, the manufacturing operation sign had changed from Tmunity to Resilience — another biotechnology company.

At its peak, Tmunity appeared to employ dozens of workers in the Philadelphia metro area, but as a private company did not consistently disclose the size of its workforce.

The pharmaceutical company Gilead sells products that treat HIV, viral hepatitis, COVID-19, cancer and inflammation, according to its U.S. Securities and Exchange Commission records. One of those specialties includes cell therapy, short for chimeric antigen receptor (CAR T-cell) therapy.

That’s the type of cell-therapy technology deeply researched and developed by University of Pennsylvania faculty and staff. It’s also the biotechnology that federal regulators have required to have a boxed warning label about the “risk of secondary malignancies in patients treated with CAR T-cell therapy” since April 2024.

Gilead warned investors about the risks related with cell therapy commercialization, such as spotty health insurance reimbursement for products like Yescarta and Tecartus — referring to Medicaid, Medicare, Affordable Care Act exchange insurers and private insurance companies.

“A high rate of failure is inherent in the discovery and development of new products and failure can occur at any point in the process including late in the process after substantial investment,” according to the company’s investor disclosure.

Earlier in Tmunity’s research and development process, there were issues with the cell therapy during trials. In 2021, Tmunity laid off workers after patient deaths halted the study of its prostate cancer cell therapy product. The prostate biotechnology was not part of the acquisition deal.

By February 2023, Gilead agreed to acquire Tmunity for its CAR T-cell therapies for $300 million — all the shares not previously owned by Gilead, an earlier stage investor.

Tmunity investors, which included the University of Pennsylvania, were eligible to receive up to $1 billion in “potential future payments upon achievement of certain development, regulatory and sales-based milestones,” as well as royalty payments on sales, records show. The first $25 million was paid across all investors in January 2024. Later that same year, the company spent another $47 million on Tmunity.

Gilead’s Kite was responsible for an amended research license agreement that included an undisclosed amount of research funding to Penn. That agreement was extended until 2026 with an option to renew. It was not clear whether it will be renewed.

University of Pennsylvania researchers Carl June, Bruce Levine, James Riley and Anne Chew had individual equity stakes in Tmunity and were paid as scientific advisors to Kite. They all stood to receive future compensation for royalties for the medications.

“Kite’s singular focus on cell therapy makes them unique and particularly nimble,” said Dr. June, Tmunity’s founder, and Richard W. Vague, professor of immunotherapy at Penn’s Perelman School of Medicine and director of Penn’s Center for Cellular Immunotherapies, in a press release about the company. “Kite has demonstrated an ability to globally scale cell therapy and address the unique challenges and opportunities that cell therapy represents, which are quite different in material ways than traditional pharmaceutical or biotech approaches.”

In lieu of an interview for this story, Penn Medicine shared in a press release that its CAR T-cell therapy treatment has already served thousands of patients, especially those with rare and difficult-to-treat diseases.

In 2023, the first clinical trial of dual-target CAR T-cells to treat glioblastoma — an aggressive brain tumor cancer — was run by

Dr. Stephen Bagley inside Penn’s Division of Hematology and Oncology and its department.

That clinical trial was partially funded by Kite, the Gilead company that took over Tmunity.

Kite is also expected to fund the next phase of a clinical trial for “armored” CAR T-cell therapy run by Dr. Jakub Svoboda to help treat difficult lymphoma cases. The initial trial was funded by Penn Medicine.

Dr. Bagley said federal funding for basic research makes a difference on the long path to commercialization for new medical treatments.

“I think together we can accomplish things much better and faster than if either of us tried to go it alone,” Bagley said in the press release. “From the inception of an idea to an FDA-approved therapy, you’re talking a minimum of a decade. To keep that timeframe as fast as possible for patients and to move these advances into a place where they can actually benefit people, this virtuous cycle becomes incredibly important.”

Gilead submitted a statement and declined an interview request for this news story.

In November 2024, the company’s Kite subsidiary began consolidation of its research operations into its California offices “to better align resources with long-term strategic priorities,” according to the statement. As such, that included winding down the “research led out of Philadelphia through the Tmunity acquisition.”

Any employees whose positions were eliminated were offered to apply for open jobs at Gilead and Kite “for which they are eligible,” the statement reads.

The Philadelphia closing

In November 2024, Philadelphia’s commerce department was informed that Gilead was expecting to close its offices at both 3020 Market St. and 2929 Arch St., according to a WARN (Worker Adjustment and Retraining Notification Act) letter on file with the state released publicly in June.

The Market Street office was Tmunity’s corporate office while the Arch Street lease was a research lab “related to Tmunity’s cell therapy technologies,” according to the WARN letter. In January 2025, the Philadelphia operations were consolidated into the Arch Street facility, and on June 30, everything was shut down.

The value of the payroll for the Philadelphia operation was $2.1 million, and local tax revenue lost was $123,201 annually.

“Gilead made substantial efforts to retain employees while still creating required operational efficiencies,” according to the letter.

Laid-off workers were offered 65 days of transition time for internal opportunities and three months of career outplacement services, according to Gilead.

In 2024, Gilead generated $28.7 billion in revenue from selling its products and royalties, while its net income was $480 million. In 2023, Gilead earned $27.1 billion in revenue from its products and royalties and $5.6 billion in net income. Some of the difference in profits was due to another biotech acquisition deal — Gilead acquired CymaBay, which makes liver disease medication, in a $4.3 billion deal.

Some in economic development circles would argue that Tmunity shutting down is a failure, while others would say it’s an opportunity because, often, startup founders are serial entrepreneurs and now may have capital to reinvest in a new business.

The startup itself, some would suggest, was a success because it grew out of just an idea. And a local university that acquired equity stakes in the startup was also able to cash out, too.

But for those front-line workers, the ones who neither had equity stakes nor, perhaps, the resources to move on, it’s unclear what might happen next.

Meanwhile, Philadelphia is increasingly investing in trade skills for its growing entry-level biotechnology workforce — often using taxpayer money to do it — and there’s a lingering question about what happens when the city has built a workforce of manufacturing line operators who may get left behind when a startup is sold.

The biotechnology industry has helped fuel the office market in Center City, University City, the Navy Yard and theBellwether District. Nearby suburban communities often have office technology parks.

Raising money for a startup

Here’s the life cycle of an early-stage, high-growth biotechnology business:

Begin with an idea, often leveraging the basic science of publicly funded university research to create a product; license that product to bigger pharmaceutical companies; grow by raising money from investors; lease high-profile office space; hire employees and keep growing.

In 2019, Tmunity raised $75 million in a fundraising round led by Silicon Valley investor Andreessen Horowitz. Other major investors in Tmunity include Westlake Village BioPartners, the Parker Institute for Cancer Immunotherapy, Kleiner Perkins, Lilly Asia Ventures, Crystal South, Be The Match and BrightEdge, the fund controlled by the American Cancer Society.

Overall, the startup had raised $231 million just before the COVID-19 pandemic hit in 2020.

“To win the war on cancer, we need smarter weapons,” said Jorge Conde, general partner at Andreessen Horowitz at the time of the investment. “Tmunity’s founders Carl June and Bruce Levine invented CAR-T, one of the most profound breakthroughs against cancer in recent history. This is a dream team to deliver on the bold and promising mission to cure disease using engineered T-cells.”

Startups do this in hopes of someday being acquired by a much bigger company. That way, the early-stage investors, and often founders and employees, can cash out their stakes in the business and start the cycle over again. And that’s exactly what Tmunity’s CEO did.

Economic development officials could argue the business environment for biotechnology was simply not attractive enough to retain and grow Tmunity to keep its Philadelphia roots.

There’s no shortage of talent or ideas for biotechnology startups in the Philadelphia region. Often, technology startups relocate to gain access to investor capital — something that is a struggle for officials tasked with growing a community’s economy — and use taxpayer subsidies for performance metrics rewarding one key thing: jobs.

So when the jobs are gone, was the effort a success? It all depends on who you ask.