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Date: Thu, 9 May 2002 09:41:27 -0700
X-Mailer: Lotus Notes Release 5.0.10 March 22, 2002
Hi everyone,
this is indeed bad news for life sciences in CH. There are only few jobs
and apparently the big pharma decides to get out. Read also the following
article from WSJ from Tuesday. There are a few key phrases in there that
show how little interest Novartis actually has in keeping R&D in
Switzerland:
.. Novartis hasn't stopped investing in research in Europe. It just
finished adding 1,000 staffers in research and development at its Basel
headquarters early last year. But the company has rapidly been expanding
its U.S. research capabilities, and the U.S. will develop into Novartis's
research hub, Dr. Vasella said....(that pretty much means that CH will be
number 2 behind the US and no more the main focus of Novartis' investments
into R&D).
... The Novartis Institute for Biomedical Research, as the Cambridge
complex will be called, will initially provide lab and office space for 400
scientists focusing primarily on new treatments for diabetes,
cardiovascular and infectious diseases. Eventually, the company plans to
expand the complex to nearly 1,000 scientists.... (in case you hoped for a
job back home I think we are out of luck for a while....)
... The U.S. National Institutes of Health's $23 billion annual budget
for research grants is about 50 times the amount devoted to such grants by
all of the members of the European Union combined. Europe also lags behind
the U.S. in adopting research-friendly regulations. For instance, Europe
adopted an "orphan drug act," a provision designed to encourage research
into treatments for rare diseases with certain market protection, in 2000
-- 15 years after the U.S. did ..... (does not make it easier for small
start-ups either that could fill the void)
Michael P Rudolf, PhD.
Scientist II, Tumor Immunology
IDEC Pharmaceuticals Corp
3010 Science Park Road
San Diego, CA 92191-9080
Tel: 858-431-8481
Fax: 858-431-8715
e-mail: mrudolf_at_idecpharm.com
Swiss Drug Giant Joins Exodus To U.S. With New Global Lab
By VANESSA FUHRMANS and RACHEL ZIMMERMAN Staff Reporters of THE WALL STREET
JOURNAL
Novartis AG will shift its command center for global research from Switzerland
to a new biomedical complex in Cambridge, Mass. in a move to get closer to the
center of genetic research in the U.S. and farther from Europe's less friendly
environment for drug research and profits.
The move -- to the campus of the Massachusetts Institute of Technology -- marks
one of the most significant defections yet from Europe's once-mighty
pharmaceutical industry in favor of the U.S., now the world's largest and most
lucrative pharmaceuticals market. In just a decade, the balance of research
power and investment has shifted dramatically from Europe to the U.S., sending
a frightening signal to the European Union.
Novartis's announcement comes as the European Commission is set to present a
report Tuesday on how to improve the European drug industry's waning
competitiveness. The industry says Europe's ever-tighter grip on
prescription-drug prices makes it increasingly difficult to recoup soaring
research costs there.
Critical Role
Like the rest of the industry, Novartis hopes to parlay the knowledge gleaned
from gene hunting into the next generation of innovative treatments. Basing its
research headquarters alongside the Boston area's booming biotechnology
industry, academic institutions and their pools of scientific talent will play
a critical role in discovering those drugs, said Chief Executive Daniel
Vasella.
"There is very much a strategic design behind this decision," he said. "This
isn't just another operational investment."
The U.S. National Institutes of Health's $23 billion annual budget for research
grants is about 50 times the amount devoted to such grants by all of the
members of the European Union combined. Europe also lags behind the U.S. in
adopting research-friendly regulations. For instance, Europe adopted an "orphan
drug act," a provision designed to encourage research into treatments for rare
diseases with certain market protection, in 2000 -- 15 years after the U.S.
did.
Add to that what the industry calls an increasingly hostile market in Europe
for the drugs it does develop. Publicly financed health-care systems are the
ultimate buyers of most pharmaceuticals in Europe. But to keep a lid on costs,
they set drug prices instead of leaving it up to market forces and enforce a
strict ban on direct-to-consumer advertising. Prescription drugs tend to cost
an average 40% to 60% of their prices in the U.S., and governments have
recently embarked on a new round of aggressive measures to help curb costs.
Meanwhile, the process by which governments set those reimbursement prices can
take up to a year, delaying market access.
"There's no doubt that growth and profitability in a marketplace help determine
where research investment goes," Dr. Vasella said. "It's simple business
logic." Five years ago, Europe was still Novartis's biggest market. Now, the
company generates 43% of its sales in the U.S. and less than one-third in
Europe.
Though the Swiss drugmaker's corporate headquarters and much of its research
remains in Basel, Novartis joins a growing number of European drugmakers
shifting significant research investment and decision-making power to the U.S.
French-German drug maker Aventis SA made Bridgewater, N.J., its global research
headquarters in 1999. The formerly Swedish Pharmacia Corp. transferred its
entire headquarters from London to New Jersey two years after its merger with
Upjohn Co. in 1995.
Those and hundreds of smaller investment decisions have deflated Europe's
pre-eminence as a scientific powerhouse over the past decade. In 2000, Europe
attracted only 70% of the $24.3 billion in pharmaceutical-research investment
that the U.S. did, a direct reverse of their portions of research dollars in
1990.
Novartis hasn't stopped investing in research in Europe. It just finished
adding 1,000 staffers in research and development at its Basel headquarters
early last year. But the company has rapidly been expanding its U.S. research
capabilities, and the U.S. will develop into Novartis's research hub, Dr.
Vasella said. In 1998, adding to research operations at its U.S. base in New
Jersey, the company founded the Novartis Institute for Functional Genomics in
La Jolla, Calif. Designed to work more like a free-standing academic lab than a
pharmaceutical company, the institute neighbors the Scripps Research Institute
and is close to the rest of San Diego's burgeoning biotech cluster.
As part of its initial $250 million investment in the Cambridge center,
Novartis will rent 255,000 square feet of office and lab space on the MIT
campus, paying "market rate" rent, according to the project manager. Dr.
Vasella, who made the announcement in Cambridge at MIT president Charles Vest's
home, said the drug company was offered "no tax breaks." Rather, a key factor
in the decision, Dr. Vasella said, is "the profitability of the U.S. market."
The company also already collaborates with the Dana Farber Cancer Center in
Boston and has an $800 million deal with Boston-based Vertex Pharmaceuticals
Inc. to help discover drugs that Novartis could develop for the marketplace.
The Novartis Institute for Biomedical Research, as the Cambridge complex will
be called, will initially provide lab and office space for 400 scientists
focusing primarily on new treatments for diabetes, cardiovascular and
infectious diseases. Eventually, the company plans to expand the complex to
nearly 1,000 scientists.
As part of the reorganization, Novartis appointed Mark Fishman, director of
cardiovascular research at Massachusetts General Hospital, as its head of
global research in Cambridge.
Write to Vanessa Fuhrmans at vanessa.fuhrmans_at_wsj.com and Rachel Zimmerman at
rachel.zimmerman_at_wsj.com
Updated May 7, 2002
12:15 a.m. EDT
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Received on Thu May 09 2002 - 18:08:45 PDT
