Sector News

Novartis chief: Sometimes you have to kill your R&D darlings

March 25, 2015
Life sciences
Novartis CEO Joseph Jimenez presides over one of the industry’s largest R&D budgets, committing about $10 billion a year to drug development. But the American-born executive, in contrast to his predecessor, has made a habit of ditching projects when they start to look futile, a philosophy that trickles down to Novartis’ lab work.
 
In a Bloomberg profile looking at how Jimenez stands out from ex-CEO Daniel Vasella, the 5th-year chief shares a story that illustrates his approach to R&D. In January, at a leadership retreat, Jimenez called upon John Hastewell, head of the company’s biologics research center, and handed him the company’s first “courage award.” The honor was not for a clinical success or daring discovery but rather for admitting defeat on 5 years of RNAi research and scuttling a stalled project, Jimenez told Bloomberg.
 
“One of the reasons why spending in the pharmaceutical industry is so high is that many scientists keep their products alive far beyond when they should be,” Jimenez said. “If you help them feel like it’s OK to stop the project, you’re going to save hundreds of millions of dollars.”
 
It helps, of course, that Novartis researchers get more funding and autonomy than those at other Big Pharma companies, perhaps making it easier to embrace failure. But Jimenez says the effort is part of a top-down effort to reshape Novartis into a company that is excellent at what it does well and wastes no time on what it does not.
 
That was the same motivation behind the roughly $30 billion asset swap with GlaxoSmithKline that closed earlier this month, through which Novartis essentially traded its vaccines business for some cancer drugs Jimenez believes are undervalued in what the CEO figures is a win-win deal.
 
Same goes for those courageously abandoned RNAi assets. Novartis flipped them to Arrowhead Research this month for $35 million in cash and stock, turning its attention to areas in which it can take the lead.
 
By Damian Garde
 

comments closed

Related News

February 4, 2023

MedTrace receives U.S. patent for diagnosing the human heart

Life sciences

The U.S. Patent and Trademark Office issued a patent to MedTrace for their method of diagnosing the human heart via 15O-water PET. The patented method is the foundation of the company’s software aQuant, currently under development. Hendrik “Hans” Harms, PhD and Senior Scientist at MedTrace, and Jens Soerensen, Professor and Clinical Advisor to MedTrace, are the originators of the method.

February 4, 2023

Roche taps insider Teresa Graham for top pharma job as setbacks prompt M&A questions

Life sciences

Teresa Graham, currently head of global product strategy for Roche pharma, will become the division’s new CEO next month, Roche said Thursday. Simultaneously, Roche is elevating Levi Garraway, chief medical officer, to the executive committee.

February 4, 2023

J&J’s pharma group quietly works through global overhaul, with layoffs expected to reach multiple countries

Life sciences

Fierce Pharma has obtained internal documents and video of a town hall meeting conducted this week describing what J&J called a “comprehensive review” of its portfolio. Moving forward, J&J plans to operate its vaccines and infectious diseases outfits as one group, the executives explained.

How can we help you?

We're easy to reach