Alex Philippidis Senior News Editor Genetic Engineering & Biotechnology News
Employers throughout the World Pursue Expansions of Their Workforces
The global biopharma industry has never been bigger, finishing last year with record revenue, net income, financing, and deal value. Yet as EY noted over the summer, many of these measures grew more slowly than in previous years, suggesting that the industry’s fortunes have reached a peak. The industry’s ability to keep growing this year and beyond will depend on how adroitly it surmounts growing challenges to the price of medicines posed by governments and payers intent on containing ever-climbing costs, and companies and their investors just as intent on maximizing profits. The outcome of the tug-of-war over prices will shape how quickly, or slowly, biopharmas grow their workforces.
Below is a listing of 10 countries outside the U.S. that hold promise for securing a biopharma job. We based our selections on the size of their clusters of research universities, businesses, and nonprofit research institutes, as well as on recent announcements by companies about new facilities, and the locations of job openings posted on the websites of eight pharma and biotech corporate giants—Amgen, AstraZeneca, Johnson & Johnson, Eli Lilly, GlaxoSmithKline, Novartis, Pfizer, and Roche. The countries below are listed alphabetically; they are not ranked.
Nations appearing on the list reflect either success in growing biopharma sectors, in many cases building upon heritage pharmaceutical industries with a presence of biotechs that have capitalized on talent and expertise from academic institutions—from investigators to intellectual property—as well as investor capital. In other cases, non-U.S. nations have grown in biopharma largely by exploiting one key U.S. weakness, its relatively high corporate tax rate compared with most European and Asian countries.
That advantage may be lessened, however, as the EU strives to forge a single tax policy across all of its members—at least all the ones that haven’t voted to leave, as the U.K. did with its June “Brexit” vote, and as some politicians are pressuring Germany and Italy to do as well. Six European countries continue to account for the most locations outside the U.S. that are generating the most new jobs, although three Asian countries continued in recent months to attract expansions by both homegrown and multinational biopharmas.
Biopharmas of all sizes are poised for growth in Belgium. On October 26, Namur-based VolitionRx shelled out €1.2 million ($1.3 million) to acquire a new R&D facility at Crealys Science Park, Les Isnes, Wallonia, to which the company will move in March. The new site will consist of 9000 square feet of offices, and 10,000 square feet of labs, totaling about five times the size of its current R&D facility. The country’s biggest biopharma expansion was announced in April, when Sanofi disclosed plans for a €300 million ($329 million) expansion of its biologics manufacturing site in Geel, adding 86,111 square feet of production space and labs for monoclonal antibodies. Sanofi said it “intends to recruit and leverage the expertise of highly skilled biotechnology professionals,” but hasn’t disclosed how many employees it would add to its local workforce of 530. The Geel site was opened in 2001 by Genzyme, which Sanofi acquired in 2011.
Vancouver-based Zymeworks’ president and CEO Ali Tehrani, Ph.D., asked an uncomfortable question in a commentary published by the Canadian magazine Biotechnology Focus: Why doesn’t Canada hold the #1 or #2 spots, or at least rank in the top 5 in the world for biotech? His answers included a lack of focus on the long-term growth of companies and lack of retention of Canadian biopharmas and their executives: “We seem content with being an incubator.”
Those challenges haven’t stopped several homegrown biopharma employers from expanding in the Great White North: Sterinova, a maker of sterile, ready-to-use injectable products, established just four years ago, in October opened a C$70 million ($52 million) manufacturing plant in Saint-Hyacinthe, Québec, with 55 jobs, and plans to create 50 more. Also in October, Fanshawe College announced plans for a C$9 million ($6.7 million) Centre for Advanced Research and Innovation in Biotechnology. Dalton Pharma Services added 20 jobs in the year ending August 30, when it completed a C$5 million ($3.7 million) expansion of its cGMP facility in Toronto. The pharma services provider added three sterile processing suites, an API manufacturing suite, and a semiautomated powder-filling line with significant scale-up of lyophilization capacity. Earlier this year, Ontario said it was partnering with Bioindustrial Innovation Canada to develop a biomanufacturing center in Sarnia-Lambton set to create 400 jobs.
As for incubators, Johnson & Johnson Innovation in May expanded to Toronto, opening its sixth site devoted to nurturing early-stage life sciences companies—and its first outside the U.S—at the MaRS Discovery District. The 40,000-square-foot facility is designed to accommodate up to 50 companies focused on therapeutics, medical devices, and consumer health solutions.
The world’s most populous nation, not surprisingly, has the world’s largest number of biotech jobs (figures go as high as the nearly 2.9 million R&D jobs cited by commercial real estate firm JLL in 2014), and a vision of growing that workforce further. The country’s biopharma market is expected to climb to $601 billion by 2020, state-owned China Daily reported in July. Current estimates vary from $109.41 billion (BMI Research) to “approaching $150 billion” (foreign direct investment consultancy Dezan Shira & Associates in its China Briefing). China’s 13th Five-Year Plan, which took effect this year, designates biotech as one of seven “strategic industries” the government aims to advance.
State attention to biotech ranges from biomanufacturing (the industry is also pegged for future growth through the state-run “Made in China 2025” initiative) to genetics. The government has supported the new China National GeneBank in Shenzhen, opened September 22 by sequencing giant BGI as a repository for genetic information from humans, animals, plants, and microorganisms.
Two months earlier, China’s State Council established broad goals for basing medical services on a public–private “national public health information platform” using big data by 2020: “The big data platform for health and medical services involves a person’s basic health condition, medical service, disease control and prevention, food safety, and health care, covering an individual’s whole life cycle,” Jin Xiaotao, vice-minister of the National Health and Family Planning Commission, said June 17 at a State Council policy briefing, according to a government transcript.
China continues to see expansion by homegrown drug developers. In September, WuXi Biologics opened the first phase of a $150 million perfusion biologics manufacturing facility in Wuxi city, while TOT Biopharm broke ground on a second phase of its production facility at Suzhou Industrial Park. Among global giants, Pfizer broke ground in June on a $350 million biologics and biosimilars plant in eastern Hangzhou city, while Novartis that month officially opened a $1 billion, 1300-employee research campus in Shanghai. Novartis said the new campus would focus on R&D into diseases prevalent in China, such as lung, liver, and gastric cancer. Four months later, however, Novartis scaled back some of its plans by shutting down a biologics group in Shanghai, eliminating 18 jobs.
Denmark’s largest biotech, Novo Nordisk, figured in several recent job-related announcements this past year. During 2016, the company announced plans to open a new production facility in Måløv, for tableting and packaging of oral semaglutide and future oral products, a project that will create 100 jobs. The Måløv plan was one of two planned expansions in Denmark for Novo Nordisk totaling $200 million; the other expansion, announced in July, entails adding 5381 square feet to a manufacturing facility in Kalundborg that the company calls the world’s largest insulin production plant. The Kalundborg expansion is set for completion in 2018, enabling the company to add to the site’s current workforce of 3400. But on September 29, Novo disclosed plans to eliminate 2% of its global workforce of 42,300, or 1000 jobs—half of them in Denmark, where the company is headquartered in Bagsværd. The company later said the bulk of its job cuts would be in headquarters and R&D positions, with manufacturing positions to be spared.
Two other homegrown biotechs have showed recent signs of growth. After withdrawing a planned $86 million initial public offering due to the souring market for biotech stocks, Bavarian Nordic raised even more capital—DKK665 million ($98 million)—through a private placement. Bavarian Nordic said it will use the extra capital in part to expand its manufacturing facility, as well as fund development of its vaccine pipeline, including its MVA-BN RSV program for Zika and a cancer immunotherapy.
Two biopharma giants disclosed expansion plans in France this year. Novo Nordisk said in April it would add 250 employees to the 1,100 based at its production facilities in Chartres, through a €100 million ($110 million) expansion of the site, where it now manufactures its FlexPen injector and several of the company’s insulin products. Also in growth mode is Novartis, which said it expects to add 100 jobs to a 430-person workforce at its Center of Biotechnology in Huningue, where it is carrying out a €100 million ($110 million) expansion. The Swiss pharma giant is extending a main production building and adding a second purification line and several cell culture bioreactors, all aimed at increasing production capacity by 70%.
Homegrown Oncodesign in September agreed to retain 57 employees over the next four years at the François Hyafil Research Centre in Villebon-sur-Yvette (Essonne), which it is acquiring from GlaxoSmithKline (GSK). In return, GSK is paying Oncodesign €35 million ($38 million) for the French drug discoverer to integrate Hyafil into its operations and keep the center’s workforce employed. Another homegrown biotech, Servier, said July 27 it will build a €35 million ($38 million), 37,674 square-foot bioproduction facility at its site in Gidy, near Orléans. Servier said its first research batches are expected to be produced in 2019, followed a year later by its first clinical batches. Until then, Servier is carrying out a pilot bioproduction project with the University of Dublin that the company said will be shifted to Gidy
Generating capital for future job growth is among aims of a biotech investment fund, the Fonds Accélération Biotech Santé, launched last year by France’s government. In January, France more than tripled that amount to €340 million ($373 million), after industry leaders called the original fund too small.
Europe’s largest pharmaceutical market is still assessing how much, if at all, the industry’s future growth is likely to suffer as a result of the U.K.’s “Brexit” vote to leave the EU. The Mannheim-based Centre for European Economic Research (ZEW) in October predicted in its latest annual Country Index for Family Businesses that German pharma will suffer the most severe impact, in the form of “a substantial drop in revenues,” as it is most heavily dependent among German industries on exports to the U.K. Yet the industry could also see additional jobs come to Germany, several news reports concluded, especially if the European Medicines Agency were to carry out its threat to move from London because of its insistence that the EMA be based within the EU.
One positive sign for German biopharma: The largest deal involving a homegrown biotech took place in late October, when Mainz-based Ganymed Pharmaceuticals, a spinoff from the Universities of Mainz and Zurich, agreed to be acquired by Astellas Pharma for up to €1.282 billion ($1.4 billion). According to Germany Trade & Invest, a government agency, German’s biotech sector reached an all-time employment high last year, with more than 39,000 people working in 726 biotechs. That number is likely to keep growing: In May, BASF opened an R&D center at the Crop Protection division’s headquarters in Limburgerhof, with the aim of developing new products in biological crop protection and seed solutions.
And a month earlier, Germany ratified the Nagoya Protocol, which creates a legal framework governing access to and sharing of benefits from the earth’s genetic resources. Dr. Matthias Braun, chairman of the German Association of Biotechnology Industries, hailed the Protocol as presenting “a great chance for biotechnology companies in Germany, because it ensures legal and investment security for the sustainable use of genetic resources.”
Frost & Sullivan in June extolled India’s biopharma potential, based on its “capable workforce” as well as its universities and improving quality of life. Several announcements since then appear to back up that optimism: Bangalore-based Biocon on October 28 became the first Indian company to crack the top 10 in Science’s 2016 Top Employer survey. Hyderabad-based Indian Immunologicals (IIL) on October 19 announced what it said was the world’s first vaccine against tapeworm in pigs, a recombinant porcine cysticercosis vaccine called Cysvax that may also “significantly” reduce the incidence of epilepsy in humans. In the year preceding the announcement, IIL had focused on building new facilities. ILL is developing its fourth production site, a Rs. 300 crore ($45 million) animal vaccine plant in Pondicherry, while late last year the company completed a Rs. 250 crore ($37 million) plant at Karkapatla, outside Hyderabad, designed to produce vaccines against human and animal diseases.
Another homegrown biopharma, Mitra Biotech, in August raised Rs. 183 crore ($27 million) in Series B funding, saying the capital would help it expand its CANScript™ service, which predicts personalized responses to cancer treatments, in the U.S. and elsewhere. A month later, Bayer opened a €2 million ($2.2 million) global formulation technology lab at its Vapi (Gujarat) facility, which produces active ingredients for the crop science division. And by December, Kathua District is expected to see construction start on its first biocampus, the Rs. 100 crore ($15 million) Biotech Park at Ghati.
On January 16, India’s 69th Independence Day, Prime Minister Narendra Modi announced the Startup India Action Plan, which calls in part for creating 50 new biopharma-focused incubators though the Biotechnology Industry Research Assistance Council (BIRAC), a state agency. Two weeks earlier, Modi’s government committed India to creating five new biotech clusters, 150 technology transfer offices and 20 “bio-connect” centers to promote academia-industry partnerships through a 5-year National Biotechnology Development Strategy intended to grow the industry to $100 billion by 2025, from $7 billion.
Ireland’s 12.5% corporate tax rate has long drawn biopharmas and their jobs to the Emerald Isle. But the European Commission’s recently renewed call for a “common consolidated corporate tax base”—a continent-wide single set of tax laws, with companies making a single payment divided among EU member nations—has sparked fears among Irish officials that foreign direct investment by biopharmas and other corporate giants would suffer if enacted.
For now, Ireland continues to see a parade of announcements by biopharmas. Since the summer, Pharmaceutical Product Development (PPD) said October 20 it is adding 50 jobs in Athlone in an expansion of its GMP lab operations. And no sooner did Alter Pharma open a new €5 million ($5.5 million) headquarters in Balbriggan, County Dublin, than it announced plans to add 80 jobs, creating a 120-person workforce by 2018. In September, GE Healthcare said it will create a €150 million ($165 million) biopharmaceutical manufacturing campus in Cork, Ireland—100 direct jobs and 400 more to be created by biopharmas manufacturing medicines at the campus. A month earlier, Jazz Pharmaceuticals officially opened a €50 million ($55 million) manufacturing facility in Monksland, County Roscommon, where up to 50 will be employed within 3 years.
Ireland’s largest biopharma jobs announcement this year came from Shire, which said it would create about 400 jobs at a new $400 million biologics manufacturing plant to be established in Piercetown, County Meath. Also, OPKO Health plans to create 200 jobs over 5 years at a new Product Development Centre to be built in the Waterford Business and Technology Park, at IDA Ireland’s Advance Technology Building. Also, Eurofins Lancaster Laboratories will add 165 jobs over 5 years in Dungarvan, County Waterford, by expanding its lab facility there.
The “Land of the Morning Calm” in September predicted that it would create 940,000 new biopharma and other life sciences jobs by 2020 through a strategy unveiled by the country’s Ministry of Health and Welfare. That would more than double the 760,000 jobs reported last year 2015, up from 620,000 in 2011, though the life-sci category is broad enough to include medical devices and even cosmetics.
The strategy includes new tax incentives to attract more clinical trials and additional investment in R&D facilities. The strategy follows longstanding concerns that the nation’s effort to build biopharma has been hindered by the absence, until now, of a coordinated strategy, as well as overlapping efforts by government agencies and other stakeholders, the Yonhap News Agency reported.
According to Yonhap, Johnson & Johnson is considering expanding its JLABS incubators into South Korea. While that remains to be seen, the nation’s growing biopharma cluster is drawing increased activity by other global giants. On October 28, Samsung BioLogics, a contract manufacturer whose customers include Roche and Bristol-Myers Squibb, finally priced its long-awaited IPO, saying it will raise KRW 2.250 trillion ($1.96 billion) in the nation’s largest IPO this year. Also in October, Merck KGaA opened its newest M Lab™ Collaboration Center, where 10 of the company’s scientists and engineers will work with biopharmaceutical manufacturers to develop processes intended to accelerate development and production of new therapies. The €10 million ($11 million) center replaces a smaller collaboration facility the company oversaw in Pangyo, Gyeonggi Province. A month earlier, Songdo, Inchon, was where GE Healthcare Korea opened a “Fast Trak Center.” The $7.4 million facility is designed to provide practical training, technology evaluation, manufacturing support, and consultancy services in strategies and technologies for upstream and downstream bioprocessing.
The government insists that the “Brexit” vote to leave the EU won’t change its commitment to helping build a leading industry around biopharma and the rest of the life sciences. However, the U.K. Bioindustry Association (BIA) is asking Downing Street to match those words with some more deeds. On October 7, the BIA called for expansion of the R&D Tax Credit and a new Early Access to Medicines Scheme (EAMS) that would reimburse small- to medium-sized biopharmas for supplying new treatments to patients in the state-run National Health Service (NHS).
The U.K. appears inclined to help biopharma further. On October 4, Chancellor of the Exchequer Philip Hammond said the U.K. will invest another £100 million ($122 million) in early-stage companies and jobs through a renewed “Biomedical Catalyst.” A much larger investment—£1 billion ($1.2 billion)—may occur if a planned London Cancer Hub is built. The Institute of Cancer Research is partnering with the London Borough of Sutton to develop the project, with support from The Royal Marsden NHS Foundation Trust and the Greater London Authority. The Hub, which is projected to create 7200 biopharma jobs, won development approvals by the Sutton Council in September.
A month earlier, GSK, which is based in Brentford, U.K., chose its global R&D center in Stevenage, U.K., as the home base for Galvani Bioelectronics, the £540 million ($658 million) joint venture it has launched with Verily (formerly Google) Life Sciences to develop bioelectronic treatments. And soon after the Brexit vote, GSK revealed plans to spend £275 million ($335 million) toward expanding manufacturing sites at Barnard Castle in Durham County, Montrose in Scotland, and Ware in Hertfordshire, with the goal of expanding manufacturing of biologics and respiratory drugs.