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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: derekb.lowe@gmail.com Twitter: Dereklowe

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In the Pipeline

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April 11, 2008

Free Sushi in the Cafeteria!

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Posted by Derek

So Takeda has surprised the folks at Millennium with a buyout offer. (They're battening down the hatches over in Japan, and looking for something new). I know several people over at the latter company, and I can imagine that yesterday was one of the less productive days around the labs. No doubt there was a lot of initial fear that this would be a Pfizer-style deal (see below), but as the day went on that didn’t seem to be the case. I’m told that retention bonuses are being offered, along with several other features to try to keep the Millennium operation running.

Takeda’s been increasing its US presence over the years. Signing up with Abbott to form TAP (Takeda-Abbott Pharmaceuticals) some years ago was one step, as was recently buying out that entire partnership. They bought San Diego-based Syrrx a couple of years ago, and now they have a foot on the ground in Cambridge for oncology research. The Syrrx site is now "Takeda San Diego", but interestingly, Millennium is apparently going to keep its name. I also find it interesting that the company hasn’t decided to put up a big research site in one location and call it “Takeda – US”, but have rather taken the retail approach.

How easy managing those sites will be depends on what approach they take. For now, it looks like they’re going to take the easier one, which is to let Millennium carry on in their own style (albeit with more money). We can debate the wisdom-to-folly ratio of that another day. But overall, it looks like the Japanese see something in the smaller US companies that they don’t have themselves, and would like to try to buy. The lighter their touch, the more likely that what they’re after will actually still be around once the checks clear.

Contrast that to, say, Pfizer’s purchase of Sugen, or Lilly’s purchase of ICOS, or J&J’s purchase of Scios. In those cases, the larger companies were in it to buy a drug (or a few possible drugs), and that was that. Medicinal chemists? Pharmacologists? Those they already had. What they needed were the clinical candidates or marketed compounds. The folks in the small-company labs quickly found themselves getting those “What, are you still here?”. And pretty soon, most of them weren’t, voluntarily or involuntarily.

Comments (18) + TrackBacks (0) | Category: Business and Markets


COMMENTS

1. Mark M on April 11, 2008 9:02 AM writes...

Well that is a rosy picture, but let's check back with the MLNM folks a year from now to see if they are still happy/productive.

I hate to sound pessimistic, but firms with overseas HQ invariably change for the worse wrt folks at the US site feeling like their ideas for the future have no weight.

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2. Tygurr on April 11, 2008 9:13 AM writes...

I worked some years ago for a textile company in the US which was bought out by Takeda. We provided silicone coated fabrics for the airbag business owned by Takeda.

The upshot of my experience was that Mr. Takeda is smart enough to realize when he has a good thing and then leave well enough alone. If these people know what they are doing then they will be just fine.

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3. CMC guy on April 11, 2008 9:45 AM writes...

I suspect/trust Takeda which provide the more long-term perspective in achievement of success as is the typical of common Japanese business approach. This would be a refreshing difference from most US pharmas these days. Do think MLMN will have to adjust from being independent and indeed like trades in baseball may take a few years to determine if positive however often the problem is attitudes in changing roles/relationships.

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4. Don B. on April 11, 2008 9:46 AM writes...

How could you forget pfizer buying Warner Lambert/Parke Davis & instituting a scorched earth policy?

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5. SynChem on April 11, 2008 9:53 AM writes...

Mark,

How can anyone at Millenium NOT be jumping-up-and-down happy going from a shaky job to working for a great and stable big pharma? They even get paid a bonus to stay!! One would be glad to even have a job these days, at any company.

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6. WC on April 11, 2008 10:42 AM writes...

Synchem, I hope thing work out well for the MLMN folks, but having been through 4 mergers/aquisitions, it's nearly impossible to try and predict how work life will be for them 6-12 months from now.

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7. Petros on April 11, 2008 11:33 AM writes...

What's the gossip on the state of play with Scios' p38 inhibitors? They seemed to be leading the way at the time of the J&J takeover.


You forgot Eisai's recent purchase of MGI Pharma, for similar reasons to Takeda's.

And BMS of DuPont is another deal of a while back

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8. sroy on April 11, 2008 7:08 PM writes...

A large company taking over a smaller company and not trying to destroy it, after getting the drug/ drug candidates? In this day and age- are they nuts *S*. If such rational behavior occurs more often, hell might freeze over.

Honestly, how did we reach this current situation where rational constructive behavior becomes news and irrational destructive behavior the norm?

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9. weirdo on April 12, 2008 10:10 AM writes...

Where is the evidence that Millenium doesn't NEED to be ravaged? An extremely well-funded big biotech with a research arm that rivals many smaller pharma that has yielded -- what, exactly?

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10. setsuna on April 12, 2008 4:50 PM writes...

I remember when a lot of the structure guys left Syrrx, my understanding is that it looked like a land grab in San Diego; it'd be interesting to understand what sort of return they would have right now given the current state of San Diego real estate.

I could never figure out why else they would by Syrrx though...they had a lot of really bright structure people there at one time; unfortunately that doesn't mean you'll make drugs any better/quicker.

I am still waiting for Derek to write up (what I consider, but perhaps I am wrong?) the massive failure of structure based drug design and an extremely generously federally funded structural genomics program. I don't think anyone has *really* called them out yet...

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11. sjb on April 14, 2008 2:56 AM writes...

On the other side of the coin, I wonder how this will affect Takeda (ex Paradigm and if memory serves Amedis - http://pipeline.corante.com/archives/2004/05/02/odd_elements_in_drugs_silicon.php) here in the UK? They seem to be on a bit of a drive at the moment, but I can't seem to get replies to e-mails or letters and faxes with CVs.

S

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12. anon on April 14, 2008 7:50 AM writes...

"I am still waiting for Derek to write up (what I consider, but perhaps I am wrong?) the massive failure of structure based drug design"

I'd say you are wrong. SADD doesn't mean you sit down and gears spin and the computer spits out the One molecule you need to make; it DOES mean you can prioritize when to make what better. IMHO. If you want failure, look to combo.

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13. Michael Caton on April 14, 2008 10:05 AM writes...

As a consultant at COR Therapeutics I'm having a little trouble feeling sympathetic to people's pink-slip worries at MLNM. Does anybody remember COR Therapeutics, which was a fully functioning cardiovascular biotech with a successfully marketed drug, and which MLNM purchased and then a year later canned everyone? That said, obviously the people in the labs have nothing to do with these decision, but the point is there's always a bigger fish. Which is why big pharma really is NOT more stable (ask Scios!). But these things often have a silver lining. My approach would be to take the retention bonus and start looking for my next position right now so as soon as the retention period ends I can walk. Meanwhile the post-buyout diaspora is developing your network. And having been brought into MLNM as part of COR, unless things have changed drastically in the last five years, I can tell you MLNM really isn't that great a place to work compared to other biotechs, so you're not missing much.

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14. CMC guy on April 14, 2008 3:39 PM writes...

#12 anon I think both SADD and combichem might be classified as failures in the same sense that they were much overhyped and promoted as means to faster and better drugs (plus there have been other passing approaches/fads that did not meet all their promises). Each has values as tools if used properly rather than as total replacement proclaimed however discovery typically takes a collection of biology, chemistry, medicine and (even some)business/marketing with some good timing and insights along the way.

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15. setsuna on April 15, 2008 9:07 PM writes...

# 12 anon
I don't disagree that combichem has failed unbelievably, given that the whole promise was to speed up drug discovery by orders of magnitude.

Take a look at GNF (Genomic Novartis Foundation....which Pfizer kinda own now I think) not far from Takeda....it was kind of a capital of combichem...last I checked they didn't get a damn thing done despite oodles of money.

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16. milkshake on April 15, 2008 10:25 PM writes...

Big Pharma job can be incredibly stable - the jobs in Groton withstand any concievable merger no matter what the actual productivity in that site is - They were trying to hire 30 new PhD chemists into Central Research last time I heard. You know, the trunks of trees were standing in the epicenter of the Tungska hit...

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17. weirdo on April 15, 2008 10:58 PM writes...

"the jobs in Groton withstand any concievable (sic) merger"

That may come as a surprise to all the Ph.D.'s who were let go over the past two years, and to those who were essentially demoted.

Also, Groton has now gone to a two-tier Ph.D. chemist system -- one tier thinks and one tier just makes molecules. Puts Derek's most recent post into perspective.

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18. gaston on April 16, 2008 12:44 PM writes...

"Also, Groton has now gone to a two-tier Ph.D. chemist system -- one tier thinks and one tier just makes molecules. Puts Derek's most recent post into perspective."

I hope the sets overlap. Thinking about the BEST molecules to make might be is the med chemist's prime directive. Derek seems to believe schmoozing up the biologists is more critical (to getting a drug in the clinic) than it actually is, in the real world.

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