news of the week J ULY 2, 201 2 E D I TE D BY W I L L I A M G. SC H UL Z & N A DE R H E I DA R I
ROCHE TO SHUTTER NEW JERSEY LABS PHARMACEUTICALS: Planned closure is the latest big pharma retrenchment from the state
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N A MOVE that will reverberate through New Jer-
left us with an expensive and oversized infrastructure,” says Thomas G. Lyon, the Nutley site’s head. “While we have made notable progress to cut costs by more than 50% in the past two-and-a-half years, it was not enough.” The shuttering of the Nutley operations is part of a troubling trend for the life sciences in New Jersey. From 2007 to 2010, the number of drug industry jobs in the state fell by 22.4% to 32,794, according to a report released last month by the nonprofit Battelle and the Biotechnology Industry Organization. Pharma’s retrenchment from New Jersey is a symptom of the industry’s changing approach to research, says Richard M. Gordon, a drug industry analyst at the University of Michigan’s Stephen M. Ross School of Business. Although the state is steeped in traditional drug discovery expertise, companies are now investing
sey’s “pharmaceutical alley”—the state’s hefty collection of big pharma labs—Roche says it will close operations in Nutley, N.J. The decision to shutter what for decades has served as the Swiss drug company’s U.S. headquarters is expected to cost 1,000 people their jobs. The Nutley site conducts research on oncology, virology, and inflammation. Oncology and virology activities will be transferred to facilities in SwitJOB SHIFT Pharmaceutical industry jobs zerland and Germany, where about 80 positions are swiftly moving out of New Jersey. will be added. Inflammation research will be discontinued, although a few projects could be shifted to labs in Europe, a Roche spokeswoman says. The Swiss drug giant claims that the cuts will enable it to keep R&D spending flat despite a steady rise in the number of projects in clinical studies. CEO Severin Schwan notes that over the past 18 months, Roche has seen promising results in 24 of 28 late-stage trials. Jean-Jacques Garaud, head of pharma research and early development, will leave the company at the end of the month, and Mike Burgess, head of oncology and large-molecule research, will take over Garaud’s duties on an interim basis. When the Nutley site closes, Roche will no longer have laboratories on the East Coast. The SOURCE: Battelle/BIO State Bioscience Industry Development 2012 report company will instead create the Pharmaceuticals Translational Clinical Research Center to support its interactions with regulatory authorities and more heavily in large molecules and “informationacademic and biotech partners. Roche expects to trans- driven discovery,” Gordon says. fer roughly 240 jobs from Nutley to the center, which it “New Jersey’s competitive advantage was one of the hopes to open in 2013 at a yet-to-be-determined site. previous generation, but it offers nothing in terms of Drugs such as Valium and other benzodiazepines the new generation,” he says. When considering where were invented in Nutley, which has been the centerto put new labs, pharmaceutical companies are increaspiece of Roche’s U.S. operations for 80 years. The firm’s ingly looking at San Francisco and the Boston area, top management was based there during World War II. which offer proximity to biotech firms and academic But the site’s role shifted after the company’s 2009 ac- research centers. quisition of the biotech firm Genentech. Roche transMerck & Co. and Pfizer both shed jobs in the state ferred commercial operations to Genentech’s South after their 2009 acquisitions of Schering-Plough and San Francisco site that year and ended some research Wyeth, respectively. Among the more recent setbacks activities—notably in RNAi—at Nutley in 2010. for New Jersey, Sanofi is set to close its Bridgewater “Nutley’s legacy and footprint as a much larger for- facility by the end of the year. Research activities will mer regional headquarters and a manufacturing site be moved to a new site in Boston.—LISA JARVIS WWW.CEN-ONLIN E .ORG
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