Bristol-Myers plans R&D overhaul, site shutdowns
- Bristol-Myers Squibb on Tuesday further detailed its planned operational shake-up, adding its name to the growing list of biopharmas seeking to streamline R&D and manufacturing networks.
- The company said it would focus investment toward R&D hubs in central New Jersey, the San Francisco Bay area and Cambridge, MA, and is shuttering sites in Washington and Hopewell, New Jersey as part of that effort.
- The Hopewell site will be a phased closure through 2020, while the company is not renewing a lease which expires in 2019 for another facility in Seattle, Washington.
Bristol-Myers first sketched out the planned changes to its operational model during an update on third quarter earnings in October. The so-called "evolution" is aimed at three objectives: focusing investment in key markets, improving the competitiveness of R&D and expanding manufacturing capabilities in biologics to better support the company's portfolio.
The update released Tuesday helps to clarify what that evolution will look like.
Bristol-Myers now plans to construct a new R&D building at its Princeton Pike facility in Lawrenceville, NJ — one of the three key aforementioned R&D hubs. The building will serve to co-locate lab-based activities in Discovery and Translational Medicine at the site.
Elsewhere, Bristol-Myers will invest in construction at a facility in New Brunswick, NJ, to better support biologics development there. This will complement the recently completed $280 million biologics campus in Devens, MA.
Yet all that investment and expansion will come at a cost. In addition to the planned closures in Hopewell and Seattle, Bristol-Myers confirmed it would shut down its Wallingford, CT, facility and canceled construction of a development site also in that state.
"These important changes to our U.S. geographic footprint will ensure we have the structural, operational and financial flexibility to deliver as effectively as possible on our mission for patients," said Bristol-Myers' CEO Giovanni Caforio.
The company did not announce any hiring or layoffs associated with the moves, although it did say it expects the roles at the Wallingford, Hopewell and Seattle sites will "transition" to other locations.
Despite a post-election surge in biopharma stocks, the industry has felt the pain of a tightening price environment and increased competition in key primary care sectors. Major drugmakers such as AstraZeneca, Novo Nordisk, Sanofi, Boehringer Ingelheim and Eli Lilly have all announced or are reportedly mulling layoffs in recent weeks.
At the same time, companies across the sector, such as Merck and Novartis, have made moves to slim down expansive R&D networks, focusing investment on key hubs and on biologics development. Hotbeds of research and science such as Cambridge, MA and San Francisco stand to attract even more attention than they already do, while others may see layoffs and shutdowns.
- Bristol-Myers Squibb Press release
- BioPharma Dive Bristol-Myers reshapes operations in wake of Opdivo miss
Follow Ned Pagliarulo on Twitter