Genentech, Roche Find New Balance Three Years Post-Merger

5/29/12Follow @arleneweintraub

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to Roche CEO Schwan. “It hasn’t gone that high, and I don’t think it ever will,” McCracken says. “We coordinate our activities to avoid competition.”

In fact, Scheller says, Schwan has taken a largely hands-off approach to making decisions about what science the company should pursue. Scheller, who reports directly to Schwan, says that has amounted to even more freedom than he had when he reported to Art Levinson, Genentech’s previous CEO. Levinson is now chairman of Genentech’s board of directors, as well as a member of the bigger Roche board. “Art is a scientist, so we talked all the time about what we should do next,” Scheller says. “My boss now is extremely smart, but he’s an economist. He expects me and my colleagues here to make scientific decisions.”

McCracken, who worked at Genentech before moving over to the Roche side, says Roche has adopted some aspects of Genentech’s culture in an effort to make R&D more efficient. For example, the company has embraced the Art Levinson system of making big decisions, which mandates that one person be the decision maker, not a whole committee. “Roche historically was consensus-oriented in making decisions,” McCracken says. “At Genentech, the concept was the single person who’s in the best position to make the decision makes the decision. I see that transformation at Roche.”

Executives and employees at both arms of the company are now being encouraged to help find other ways to further streamline R&D. At Genentech, there’s an effort underway called “Rethink D,” which encourages employees to try new methods for improving drug development. Towards that end, the company is piloting a program in its clinical trials for T-DM1 that allows patients to use iPads to complete some of the informed consent paperwork, which can be filled with daunting legalese for patients. “Our goal is to make the development process quicker, and maybe less expensive,” Clark says.

Roche is also working on strengthening its relationship with the academic community—a goal that has become a priority at the Nutley research site. Jacques Banchereau, who joined the site in October 2010 as head of virology discovery, came from the Baylor Institute for Immunology Research in Dallas. Roche is currently working with the institute on an HIV vaccine, Banchereau says. “Part of our transformation here is to make partnerships between our scientists and scientists in academia,” he says. The Nutley site has also recruited several academic researchers, including Hyam Levitsky, an oncologist from Johns Hopkins, James Cassidy, an oncologist from the University of Glasgow in Scotland, and Pamela Carroll, a biology Ph.D. from Harvard who is an expert in improving drug discovery. “We are recruiting at a small scale people who bring knowledge we need,” Banchereau says.

When asked how the integration has impacted innovation, Roche’s and Genentech’s early research groups are each able to point to about 30 new drugs working their way through their respective pipelines. “We’re very happy with the flow of molecules,” says Genentech’s Clark.

As for whether Roche is truly leaving Genentech alone, Clark says the answer is isn’t black-and-white. “We are more integrated, but there is a fairly significant measure of separateness,” he says. He adds that regardless of what changes as the integration continues, both legs of the company will continue to follow the Genentech’s longtime mantra: “We follow the science.”

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