Lilly’s San Diego Biotechnology Center of Silence

12/17/08Follow @bvbigelow

Eli Lilly and Co. executives were downright chatty about the company’s biotechnology strategy last week when they convened a meeting with Wall Street analysts. “We see more and more that biotech is a key to sustaining pharmaceutical innovation for the future,” Lilly’s vice president of biotech discovery research, Tom Bumol, said in a statement the company released Dec. 11. Summing up Lilly’s “transformative” strategy for the analysts’ meeting, Bumol added, “Over the past decade, we have built a new integrated biotechnology infrastructure, from discovery through development, and including delivery, devices, and manufacturing.”

But in San Diego, where Indianapolis-based Lilly is busy developing what it calls a “Biotechnology Center of Excellence,” the world’s 10th largest pharmaceutical company is as silent as a sphinx.

After acquiring San Diego’s SGX Pharmaceuticals in August for $64 million, Lilly has been busy consolidating SGX with AME, or Applied Molecular Evolution, a San Diego biotech Lilly acquired in 2004 for roughly $400 million. Lilly has been operating AME as a subsidiary here ever since. The company also has a lucrative partnership with San Diego’s Amylin for Byetta, its drug for type 2 diabetes.

Signs of Lilly’s activity are everywhere. The company has notified state officials of plans to lay off a total of 66 SGX employees.  That’s more than half of the 120 employees SGX had when Lilly took over.

Meanwhile, in September, several weeks after closing the SGX deal, Lilly signed a 10-year lease for a two-story, 125,000-square-foot life sciences facility, according to the landlord, San Diego’s Veralliance Properties. Veralliance says it plans to renovate an existing building for Lilly, stripping the façade to its steel structure and rebuilding it as an ultramodern facility using environmentally friendly construction and design techniques.

It sounds impressive. “In addition to constructing a new translucent green glass curtain wall providing floor to ceiling glass for all new tenants,” the release says, “the project will include a two-story atrium entrance with a “pass through” lobby leading to a two-story spiral staircase.”

Financial terms of the transaction were not disclosed. But Lilly is expected to move into the building in March, after the renovation is completed, said Brent Jacobs of Cushman & Wakefield’s Life Science Group, which represented Lilly in the deal.

Lilly, however, has maintained radio silence about its San Diego activities since August, when the company said it had closed its SGX deal. A Lilly spokesman at the company’s headquarters in Indianapolis did not respond to repeated telephone calls or emails inquiring about the SGX layoffs or other plans Lilly has in San Diego.

Lilly appears to be hiring, judging by its online employment ads for “research associate molecular biologist, executive administrative assistant,” and other jobs. Bumol, who also oversees Lilly’s AME subsidiary in San Diego, was quoted in the statement issued by Veralliance as saying Lilly is “excited to combine both AME and its recently acquired SGX Pharmaceuticals into this location as part of the west coast Biotechnology Center of Excellence we are creating.” But what, exactly, will this Biotechnology Center of Excellence do? How many people will be employed there? Bumol did not respond to an email earlier this week.

A spokesman for Biocom, San Diego’s life sciences industry group, says Lilly never responded to inquiries he made in September about promoting the new San Diego Biotechnology Center of Excellence. That one seems especially odd, because Lilly is a dues-paying member of Biocom. But, hey, if they’re not talking, they’re not talking.

Bruce V. Bigelow is the editor of Xconomy San Diego. You can e-mail him at bbigelow@xconomy.com or call (619) 669-8788 Follow @bvbigelow

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