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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

« More On the GSK Layoffs | Main | Elan Tries Again »

June 12, 2008

Suits vs. Lab Coats?

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Posted by Derek

Well, this is turning into GlaxoSmithKline week around here, but with good reason. I’ve had a lot of mail from people who have been affected by this week’s cutbacks, and others who left the company before the latest round. And that leads to these thoughts for today:

1. The company is being rather coy when they describe the current layoffs as only involving 2% of the work force. The recent cuts were focused on the Centers for Excellence in Drug Discovery (CEDDS), which is where the great bulk of discovery medicinal chemists are. To be more specific, this one seems to have hit the Metabolic Pathways group especially hard, and there’s thought that the other CEDDS will be going through similar contractions.

And there have been other cutbacks over the last few months, though, and there are surely more to come. With such a smaller head count in the CEDDS, everyone seems to be expecting the related groups to be next in line – IT, chemical development, more of the in-house biology, and so on. If the company is doing more research on the outside, then some of these folks will presumably not be needed. GSK looks to be shrinking for many months to come.

That makes a person wonder about whether these cutbacks are meant to send some big signal to the investors or not. You'd think that you'd make a bigger deal out of them if that were the case, rather than minimizing them for the public, as the company seems to be doing.

2. It’s going to be interesting to watch to see if the new style the company is trying will work. They’re breaking down the CEDDS into even smaller teams, from what I hear, turning the discovery organization into who-knows-how-many smaller competing units. It’s been described as the “if only we were a bunch of startups” philosophy, and there are several points to consider about that.

For one thing, startups may not be as wonderful as they appear statistically, because of survivorship bias: a number of them disappear with people having hardly been aware that they were around in the first place. Even if that’s a desirable state of affairs, will a large company be able to replicate it in-house? And even if it can be done, will it happen in this case, or will the teams be either too large to be nimble or too small to work? I’ve no idea. Neither does anyone else, and it'll be years before we know.

3. There have been a lot of comments, both here and at other news sites, about how this is another evil deed of the MBA folks, and if they’d only turn things over to the scientists and get back to the science, the company wouldn’t be in this position. Hmmm.

What I'm about to say feels strange to me, because I’m a scientist through-and-through, and I’ve done my share of complaining about ridiculous business attitudes. For that matter, I've found myself laid off though what I thought was a mistaken site closure. But all that said, there’s a case to be made that GSK partly got themselves into this fix by letting the scientists free to do science. That’s how I see, for example, the huge effort the company had for years in nuclear receptors. A massive amount of fundamental work was done, but (because it’s such a horrendously difficult area) little or nothing ever came out the far end to make anyone any money. I'm willing to be corrected on those points, but that's how I see it now.

And it’s not like the company’s productivity has been one of the wonders of the world overall. One correspondent, an ex-GSK researcher, pointed out to me in an e-mail that one of the sites hit hard this week had taken one drug to market in twenty-five years. Some of that is surely bad luck, but that explanation can only take you so far.

It’s interesting to hear people talk about the good old days in the industry. The other day I saw a comment about getting things back to the good productive days of the mid-to-late 1990s, which (I can tell you) didn’t seem to flippin’ productive at the time. But there are stories beyond counting of the days when Company XYZ Really Had Their Act Together, when the scientists were happy and management was wise and stayed out of their way, and the clinical candidates flowed like a free bar at an ACS meeting.

I used to feel bad, hearing these tales, sorry that I’d missed such days. But then I noted their similarity to the myths of Golden Ages that you see everywhere, and began to wonder. The drug industry was definitely a different place back when. Screening cascades weren’t so rigorous, animal models ruled the day (and actually, in some cases, steered projects right more quickly than their replacements), and there were more good targets that hadn’t been exploited yet. I’m willing to stipulate all that; it was a different world.

But most of us, I think, date the Real Good Old Days of the industry to a period before we joined – no matter when that was. Listening to people talk about when things were good is like listening to the guys down at the lake tell you that you should have been around last week when the fish were biting. There were any number of severe problems back in any Golden Era, but those sort of disappear into the glowing mist.

4. So GSK’s upper management is doing what upper management does: they’re trying to get a better return on their money – for which, read “the money of the shareholders”. Looking over the last ten years or so, they’ve decided that what the company has been doing has not been working. The loss of Avandia (whose discovery goes back further than that period) made the problems unignorable. So they’re trying something different. It’s hard to make the case that something different wasn’t needed.

We can all argue about whether this particular something is the right idea, or whether it’s being implemented in the right way. But no one should be surprised that a company with GSK’s current issues and cost structure is being shaken up. These cutbacks may be the work of people who are mistaken; they may even be the work of fools. But it's not the work of greedy sociopaths bent on destroying the drug industry. I’d give up on that line of thought and switch to something more useful.

Comments (37) + TrackBacks (0) | Category: Business and Markets


COMMENTS

1. Kay on June 12, 2008 11:08 AM writes...

Really small groups - connected to others in the form of service contractual relationships - are the only way to find the lame and assign the blame. That's why management is moving in the start-up direction.

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2. jhp on June 12, 2008 11:16 AM writes...

Many people refer to the good old days as the age of antibiotics. As you point out, screening was simpler. Animal models were also more predicitive of human use. The pharmaceutical industry is now trying to develop drugs for diseases whose mechanisms are not well understood and for which animal models are not very predictive of human use. Yet the industry persists on using an approach similar to antibiotic disclovery. Smaller groups or companies may not make a difference. We need a different approach to drug discovery.

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3. CMC guy on June 12, 2008 11:19 AM writes...

Derek I have to ask if you think this hints at a GSK effort to adopt the MIT prof strategy discussed a few months back (http://pipeline.corante.com/archives/2008/03/18/a_solution_courtesy_of_the_mit_faculty.php) (BTW Did you ever read the book?). The Glaxo heritage was more Marketing driven and although SKB tended to be more research slanted I am pretty sure the Marketing types dominated post-mergers.

You are correct that the Good Old Days may have not be as great as we like to claim but times sure are bad now all around it seems. Uncontrolled Science folks who don't know reg/mfg/business/marketing can be as bad (or worse) in leading a pharma company than Business/Legal types who don't value/understand R&D. The demise of many Biotech have probably as much due to structural holes in organizations as to failures in the science. There has to be balance and collaboration at many levels but at the core I think must focus on science/medicine/patient based business to enable new beneficial drugs to result.

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4. MTK on June 12, 2008 11:51 AM writes...

CMC,

I haven't looked back, but I thought the MIT profs big thing was to have some committee of grand poobahs direct research over the entire industry. That was what got a lot of us in an uproar.

As for your assessment of the labcoats vs. the suits, I think you're bang on here. It takes both and it takes an appreciation of both.

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5. satan on June 12, 2008 12:16 PM writes...

Maybe the problem lies in the belief that peer reviewed grants or ideas result in innovative research. Peer reviews are just echo chambers- not unlike right wing talk radio. Maybe the way we study biology (especially most medical research) is wrong.

For example- are rodent based models really ideal for studying human aging and diseases of old age? The same genes or even similar expression patterns does not imply that the system formed by them is "connected" the same way or can be targeted the same way.

If you look at discoveries that changes the world, they tend to come from mavericks or people who work outside rigid mental paradigms. Salvarsan, Sulfanilamide, beta lactams, most anticonvulsants, synthetic opioids, benzodiazepines, antihistamines, tricylic antidepressants, MAO inhibitors, phenothaiznes, thiazide diuretics, captopril etc were not not the result of rigorous peer reviewed c**p, but of people hunting in the dark or trying out some 'weird' idea.

However the current system spends a lot of effort destroying such people because they disturb the "order". Maybe most of them are wrong but I bet that not all of them are wrong.

I think it all comes from the hubristic belief that we know everything about the world, or at least our field. The idea that 'we are special and we know best' has stunted many promising civilizations throughout human history. The reality is that we do not know much about the world around us, what we have are educated guesses and unless you test them, you will never know which guess is closer to reality.

In case you think I am idealistic, consider what such targeted consensus research has done to the productivity of pharma companies (and your job security).

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6. processchemist on June 12, 2008 12:36 PM writes...

"mavericks" in this field are a powerful resource. I'm currently working (a mid size company project) on the scale up of a lead with this kind of origin.
Maverick's hit is the "father" of this compound. Current H2L staff took some time to rationalize this stuff and now they have a promising family of compounds (with their problems, but H2L work is still in progress).
The issue is that current average HR and management folks hate mavericks: too risky and difficult to manage.And science it's already far too difficult to cope with.

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7. CMC guy on June 12, 2008 1:08 PM writes...

MTK- to clarify I was thinking about the concept of having discovery portion and marketing portion as totally separate companies. My question is whether GSK is moving to be just a "marketer" that is isolated from R&D functions. You are correct that a distrubing element of the plan was control of discovery by committee (government run?).

Development and encouragement of mavericks is great if they are appropriately focused. Typically still need others to work with or follow-up their out of box efforts to yield practical results. Again I see much of Biotech history scattered with off-beat or novel ideas that have not been translated to usable products just like some big Pharma efforts.

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8. Skeptic on June 12, 2008 2:14 PM writes...

Scientists have rendered themselves impotent by the religion of experimental design and statistical data analysis. Its a sort of scientific communism promoted by the high priests of finance in New York and London. Your geographical regions economic significance is now determined by the quantity of cheap clones the factories (uh I mean universities) can crank out.

Look at the new virtual company run by the suits...the top dog of r&d is some demi-god of statistics from a "top-ranked" university. Its also very convenient in the court-room.

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9. MTK on June 12, 2008 2:24 PM writes...


The hubristic belief with readers of this blog is often that the industry would be fine if the suits would get out of the way of labcoats, because we do know better then them.

CMC,

I don't think GSK is moving toward just being a "marketer", but they do seem to be clearly moving from R&D to r&D.

As much as we decry the suits, they're not just doing this on a whim. I'm sure that someone has done the analysis in GSK, looking at what drugs have made it to market and which didn't, where they originated (in-house or licensed), how much they returned, and how much was spent. Given their actions, we can probably guess which "side" won and in what therapeutic areas.

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10. Petros on June 12, 2008 2:40 PM writes...

2% also seems to be rather less than the true figure. Consensus at a 1 day meeting of (primarily) medicinal chemists today, including some senior ex-GSK people, was that the true figure is around 600 (i.e 3.5 to 4%). At the Harlow CEDD, which has seen part of its area of work shipped off to China, 60 chemists will lose their jobs, but which 60 has to be decided! And bya all ccounts the cuts in Verona are also savage.

The perception was that the UK outlook isn't great with Az's big cuts at alderly edge and UCB's closure of its Cambridge site that were both announced earlier this year.

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11. Samir on June 12, 2008 2:41 PM writes...

As an outsider looking in, I've felt that GSK is a rather secretive company. Is that the correct impression? If so, would/should that change?

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12. milkshake on June 12, 2008 5:15 PM writes...

Suits vs lab coats is false dichotomy - it should be "motivated people vs pencil pushers". Red tape, corporate inertia and irresponsibility, poor motivation and poor rewarding of creativity is what makes big companies unproductive.

To me the succesful model would be to break down the company into sites and units, project groups that dont exceed 80 people. The people working on the same project should be on the floor or at least in the some building, and the group bosses should have absolute, unchallenged authority and responsibility - they could hire and fire at will, it would be up to them how they spend their budget money - whether by hiring people or buying instruments, or paying for servises provided by support groups. And if the bosses made no progress withing 4 years, the group would be fired summarily. If they made good, everybody in the group would get bonus worth of over 100% of their anual salary. Its really simple - startups face existentional pressure so they need to be lean and people working there expect big reward if they succeed.

The problem is that pencil pushers do not want to create autonomous unsupervised groups and have group leaders with unlimited authority - it does not fit well with corporate policies. Administrative folks believe that there is an ideal organisations structure and some ultimate reporting scheme that is a foundation layout into which research people could be brought by truckload and poured like a wet concrete.

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13. satan on June 12, 2008 8:01 PM writes...

Another problem with human beings is that we often tend to reward sociopaths, frauds and a**holes. If you encourage and reward certain behaviors, then you will face the consequences of your choice.

Far too often sociopaths hide behind buzzwords like management techniques, changing paradigms, statistics, business models, synergy, real life, life is not fair, just doing my job etc. Have you ever thought about the reasons behind human history being full of uprisings, wars and rebellions? Short answer- These events usually culled sociopaths (with collateral damage) and kept their numbers (and influence) in check- kinda like we now do to pest and predator species. Sadly in the modern world we have too much stability and apathy and the numbers of these problematic people are not kept in check.

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14. Skeptic on June 12, 2008 8:21 PM writes...

Milkshake said:

"motivated people"

"...if the bosses made no progress withing 4 years"

Self-serving claptrap open to interpretation. . Scientists are no different than most people... they are risk averse, see below:

Sydney Brenner Interview in Nature Reviews Molecular Cell Biology January 2008

Question: "How has molecular biology research changed in the past 50 years?"
Answer: "...I also believe that we can now do a proper study of man, instead of (but certainly in addition to) mice and flies. Existing technologies now allow us to ask cogent questions about ourselves. I think this is the challenge for the future. But we are not responding well to the challenge"

Aaron Krug, Interview in Nature Reviews Molecular Cell Biology February 2008
Q. "Are young investigators today generally less adventurous than they were 50 years ago?

"...But, I would have to say that at British universities and elsewhere, a lot of the work that is going on now is what I call ‘me too’-type work. I would like to see young people investigating new areas."

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15. Mat on June 12, 2008 11:43 PM writes...

The only sociopath here is our esteemed host. A traitor to his country, class and profession.

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16. Processator on June 13, 2008 6:03 AM writes...

I think that what we are seeing happening at GSK may become a general trend in big pharma. It is obvious that we are in a moment of adjustment and evolution of the pharma bussiness model. Whether it is right or not we will have to wait to see.

It seems that, as someone has mentioned before, we are seeing a swift from R&D to r&D. Big pharmas will most likely stat licensing more and more from smaller companies. They will then use its power and expertise to do the development of a candidate, taking it through the clinic and finally use their marketing power to put it in the market.

There is obviously a trend to cut on the science. I wonder what would happen if big pharmas would get rid of most of the marketing departments, and just outsource that activity to other companies with high energy and motivation. Just a thought.

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17. Clark Kent on June 13, 2008 7:38 AM writes...

Dear MTK,

In response to your comment: "I'm sure that someone has done the analysis in GSK, looking at what drugs have made it to market and which didn't, where they originated (in-house or licensed), how much they returned, and how much was spent. Given their actions, we can probably guess which "side" won and in what therapeutic areas."
I can't speak for other areas, but for Oncology I saw this analysis for the past 5 years worth of POCs. 5 internal projects that went into clinic, 5 successful POCs. 4 external projects that went into the clinic 4 negative POCs.
However our head of R&D came from the business development side of the organization and clearly believes that everything we've inlincensed has been a complete success. He just refuses to actually look at the results.

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18. Derek Lowe on June 13, 2008 7:38 AM writes...

Let's see, Mat - "country" I get, because (I assume) I'm a free-trade type, and I don't regard outsourcing as a crime. "Profession", I guess, is because I don't necessarily think that chemists should be in charge of every drug company because they'd automatically do a better job or something. But what class am I, anyway?

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19. MolecularGeek on June 13, 2008 8:04 AM writes...

Derek:
CHEM 622 Statistical Mechanics For Dummies?


(Sorry, I couldn't resist)

MG

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20. MTK on June 13, 2008 8:25 AM writes...

Clark Kent,

Actually, I would say the R&D head did listen, because Oncology was an area which did not get hatcheted and from what I understand, may actually get augmented, while others really got decimated.

Processator,

I do not think it's cutting science at all. Rather it's an acknowledgement that there may be certain aspects of the discovery process that they just aren't very good at and that others may be better. As Derek pointed out these cuts are concentrated at the CEDD's, not in Development, so all of that research remains. So far.

Hey Derek,

If you're a traitor, then I'm one too.

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21. chemist on June 13, 2008 8:48 AM writes...

I understand that the "reaper" is loose at pfizer again!

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22. burt on June 13, 2008 9:01 AM writes...

"I understand that the "reaper" is loose at pfizer again!"

Don't believe that old Blue Oyster Cult song... FEAR the Reaper.

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23. PharmaChemist on June 13, 2008 9:35 AM writes...

More cowbell!!!

Sorry, I'm in need of a little levity.

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24. CMC guy on June 13, 2008 10:06 AM writes...

MTK/Processator I don't know particulars of GSK operations but would suggest the perceived shift to "r&D" is not where things are headed. At most places so much of D is already heavily outsourced (CMOs for manufacturing, CROs for clinical trials) and internal resources in D areas thin with discovery (r) now getting hit in ways that other areas have been over past several years. Perhaps this has been more gradual without wholesale layoffs but many process and clinical groups are shadows of what they once where.

My impression is that continued trend where D projects are run in a "virtual mode" with bare minimum expertise/managers internally to supervise contractors. Expenditures in D outstrip r costs (common a single P2/3 clinical trail cost > annual discovery budget) so would realize little savings in this model. Although projects may be coming from in-license most get outsourced there after and because both those are expensive it has to be supported by Sales/Marketing income which is why I posed question regarding GSK heading on road to "just" a Marketing company per MIT proposal.

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25. Mark M on June 13, 2008 10:36 AM writes...

"Expenditures in D outstrip r costs (common a single P2/3 clinical trail cost > annual discovery budget) so would realize little savings in this model."

I have been told many times that expenditures (salaries, cost of materials, instrumentation) dedicated to do synthesis are a fraction of those needed to do the biology part of discovery.

Hence, it does seem illogical to pare down a low overhead part of the organization that is (theoretically) so critically linked to a firm's future product generation.

Just because your job is extremely difficult to do well does not mean you will be appreciated/rewarded by your firm. They really dont care.

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26. fred on June 13, 2008 10:58 AM writes...

"Hence, it does seem illogical to pare down a low overhead part of the organization that is (theoretically) so critically linked to a firm's future product generation."

Moreover, our bio guys can screen the total output of a week's work of our whole chemistry department in a couple of hours. I think a smell an inefficiency here, with regards to resource allotment.

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27. processchemist on June 13, 2008 12:03 PM writes...

while most big companies are cutting R&D (but also sales people, I see), Astra Zeneca plan is to cut ALL the manufacturing in few years, focusing on R&D (I hope that also process R&D will remain in house: AZ folks contributions to OPRD are among the best ones I've ever read and occasionally checked - a legacy of the good old ICI culture?).
So the fire-the-scientist model is not the only one around...

Permalink to Comment

28. Clark Kent on June 13, 2008 1:08 PM writes...

MTK,

You are correct that the Oncology CEDD did not not have massive cuts this week. However, Oncology like all the other CEDDS, had to cut headcount by 5% last year and has not been filling positions lost by attrition this year. We were in a unique position because ALL of the GW biologists responsible for 3 of the POCs were laid off two years ago, so we had plenty of extra headcount. Never believe that management will actually reward success.

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29. jeff c on June 14, 2008 9:51 AM writes...

I heard GSK is now cutting 20% of the cancer CEDD. It likely that thr RTP site that has no local biology or DMPK might disappear. This is all in the planning of eventually shutting down the RTP sites in the next 3 years

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30. Jack Friday on June 16, 2008 10:43 PM writes...

Sociopath:

a parasitic lifestyle, the ability to control or manipulate others

superficial charm, glibness, pathological lying
criminal versatility

lack of remorse, inability to empathize or lack of regard for impact on others

http://pharmagossip.blogspot.com/2008/06/lowe-on-gsks-scientist-redundancies.html

Keep voting!

shallow or feigned emotions

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31. SKFBMSGBW on June 17, 2008 12:57 AM writes...

The RTP site has been eroding since the GW-SKB merger. The rate of decay has just increased.

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32. Roberto on June 17, 2008 7:30 PM writes...

Its all going to China anyway

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33. jeff on June 18, 2008 7:02 AM writes...

dear dear now its Paxil and cheating Medicare- Isn't there better ways to make money for GSK

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34. posty post on July 4, 2008 11:48 AM writes...

great article ~ i think you've nailed some pretty important points. just my 2 cents on some raised ideas:

1.) one of the problems i've seen in the r&d business is how the "lab coats" culture is in direct conflict with the reality of the company - many a time i've argued w. the "lab coats" when they demanded uncontrolled, unclear use of resources (to create some lofty IT system that will combine all areas of science into a single chart or something). as my role of process improvement, my job was to keep the companies interests in mind - make sure what we do have some assemblence of a ROI for each dollar spent

That was a critical problem when "times were good" - some groups were able to be far fetched exploratory, or at best, chase some dreamy goal with poor and murky planning (that typically resulted in wasted time, money, effort and never actually produced a result).

This was like IT before Y2K - people pumped $B into IT, but in the year 2000, when "NOTHING" happened - the perception was IT had been blowing smoke and mirrors (or worse, fixing their mistake at the cost of the business). Now, it's moot to argue that IT did "save" the world, but that's neither here nor their, the perception of what happened is what really counts (or the perception of those with the check book). as a result IT was heavily scrutinized ever since, and the days of the visionary CIO is gone - today, the CIO is a maintenace man, at worst, and an efficient expert at best (IT is more focused on I than T, and are now being taught that "process improvement" is king - IT systems should only support it, not drive it)

In GSK, there was a critical clash between the heavily academic culture of the scientists & the business culture that really ran the company (many a time GSK scientists - like all pharma - think they "own" their research. No, you don't - that's why you're paid a salary. Company pays you to make IP - that simple. but explain that to someone whose value is reflected in the discoveries they made and papers they write)

now marketing & sales certainly have their problems - but i can't comment more other than GSK cut them b/c, on average, they weren't getting the max out of the people (basically a big cut in staff - and once those bad feelings are out of way - the remaining/new staff should be bringing in more per salesman - adjusting for lower sales etc.)

2.) this move from R&D to r&D actually makes sense - R is so risky, especially in the industry today.

By creating these smaller "biotech" groups:
a) they hope to ignite the "passion" of a biotech - small, intimate groups that have identity and a closer relationship to their productity - very easy to get lost in a big corporation & hide under the radar

b) they can now, more easily, pinpoint failures or deadends - making management decisions easier & more accurate. (Remember, at the end of the day, to a company, each employee is an investment - if you're not producing more than you're paid - you're a bad investment & need to go - it's not personal, it's business)

c)the "D" can mature in a more adaptive & flexible way to "pick up" from multiple sources of "R" - the more adept they get at picking up from either internal or external sources, the more flexibility they have to outsource or insource research

d) you've essentially added much more breadth to where that new drug will come from - the same way IT resources can come from internal groups or outsourced groups

e) much to the point you raise, many biotechs fail. in fact, part of the reason one would look external is that these biotechs are really taking the risks - those that rise up typically don't have the infrastructure to actually do "D", just "R" - so what is the goal? - sell to a large pharma.
As a result, GSK has removed a good amount of risk from it's books, again as most "R" efforts fail.

But the counter argument is that "D" is much more expensive - well it is, but GSK already made these investments in equipment, space etc. Take a moment and look at your typical lab - i bet within first glance, you're staring at $8M of equipment.

so what's a company to do with our costly "D"?

i) we can dump most of the eqipment, but that won't make the most sense (like trying to sell an SUV in today's economy)
OR
ii) we can replace people for the half the cost in China or India ~ which means those that remain will probably be productive enough to cover all the work coming in from "r" & overall, we're spending less money (let's face it, there is some real talent potential in these countries)

the other reason why ii) will be the answer, is i'm also given the ability to increase or decrease my resources with a contract change - no need to pay pensions, severance packages, etc.

One can point out the IP & quality concerns with these companies - but, market pressues will correct that over time - and with so little going on in the "R" space anyway, now is the best time to try this with the training wheels on - hoping by the time "r" starts to pump out, pharma will be a well greased up machine wrt Chinese & India partners.

3) On that last point - this is where it will ultimate go. In a few years, ALL "typical" work will be done with outsourced partners (until their costs rise). In the future, you'll have big pharma basically become a brand - similar to other industries, where it's virtual in the sense that the raw materials, manufacturing, r&d, product developement, and marketing are all handled by small, focused, independent groups.

It costs less on everything from salaries & pensions to real estate & utilities. And as for arguments regarding quality - give it some time, there will be enough opportunity & competition to become a CRO, quality must improve.

The only people left in the company will be the "percieved" innovators - either those with the ability to innovate, those with the ability to spot it, and (unfortunately) those with the ability to fake it.

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35. processchemist on July 5, 2008 12:59 AM writes...

>One can point out the IP &
>quality concerns with these
>companies - but, market
>pressues will correct that over time

Where market takes the place of the Divine Providence... over time there will be corrections, sure. But local inflation (not core inflation, the real one incuding energy and food) will grew even more eroding the foreseen margins.
Let's say that some kind of agreement with the local government (I invest, you owe me a bigger slice of a bigger market - ehi, we're not talking about a western democracy) will compensate the growing prices. At the end of the process we'll have a flat balance, with maybe some vioxx-like cases.
But in the short term you can try to keep calm angry investors and hostile market makers, and this is the core issue.

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36. lab coat on July 11, 2008 3:53 PM writes...

very interesting post and the replies are good. i had fun reading it.

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37. Cleanroom Supplier on July 24, 2009 7:17 AM writes...

"I understand that the "reaper" is loose at pfizer again!"

Don't believe that old Blue Oyster Cult song... FEAR the Reaper.

Love it!

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