On the edge of a patent cliff, Lilly trims entire research center in Asia.
November 16, 2010 | SINGAPORE—Eli Lilly will be closing the Lilly Singapore Centre for Drug Discovery by the end of the year, according to an email sent on October 15 by Jonathon Sedgwick, managing director & CSO, Lilly Singapore Centre for Drug Discovery (LSCDD).
The email, addressed to members of the Singapore scientific community, stated that LSCDD will cease operations in Singapore and the site will close by the end of 2010. Most of the ongoing drug discovery, biomarker, and computational sciences work will be transitioned to the U.S., said Sedgwick, as well as relocating “some of the key talent we recruited [in Singapore] to Corporate HQ [in Indianapolis, Indiana] to maintain continuity around the work initiated and developed at LSCDD.” Sedgwick said that Lilly hopes to retain as many scientific collaborations with the Singapore community into 2011 as possible.
Sedgwick expressed disappointment, but noted, “We are also very aware of the challenges Lilly faces in the next few years and that on occasion, difficult decisions will be made to ensure our R&D organization is structured best to develop novel medicines for patients.”
The challenges Sedgwick referred to include regulatory disappointments, legal issues, and a harrowing patent cliff. Over the next seven years the drugmaker will lose patent protection on drugs accounting for 74% of its 2009 sales.
In a September 30 interview with the New York Times, Lilly’s CEO, John Lechleiter, promised that the company will survive. He said the company plans to eliminate 5,500 positions and $1 billion in costs by the end of 2011.
Yet in late September, J. P. Morgan forecast “a prolonged period of depressed earnings” from 2012 to 2016. Analysts noted that Lilly has several interesting pipeline assets, but they remain several years from market.
In Singapore, a spokesperson for LSCDD told Bio•IT World that the closing will not affect Lilly’s research areas of focus. “Projects and capabilities deemed a priority for Lilly’s global research organization will be transitioned to the company’s global headquarters,” the spokesperson said, adding that, “Lilly employees in Singapore affected by the closure will have the opportunity to apply for limited jobs at our global headquarters.”
Lilly Sales and Marketing and Lilly’s phase 1 clinic, the Lilly-NUS Centre for Clinical Pharmacology, will remain in Singapore. The clinic is the only Lilly clinical pharmacological unit outside the U.S. with its own clinical research unit for conducting clinical trials with new pharmaceutical agents.
Lilly Singapore Centre for Drug Discovery currently houses a small component of oncology and diabetes drug discovery research as well as systems biology and an informatics/computational science group. The site has 130 research employees and the company has had a presence in Singapore since 2002. •