Under the terms of the new agreement WuXi Pharmatech will provides Janssen Pharmaceutica, part of J&J’s Pharmaceutical Research & Development division, with integrated research services in the area of discovery chemistry, discovery biology, chemical and analytical development services, formulation, and preclinical and bio-analytical services.
Previously, WuXi was supplying only discovery chemistry services to J&J, so the expanded agreement represents a significant hike in the scale of their collaboration, and reaffirms the value that the larger CROs can accrue by developing a broad, integrated service portfolio. The terms for the new contract and indeed the previous one have not been disclosed.
Recent weeks have seen other examples of wide-ranging collaborations between CROs and drugmakers, in keeping with the shift from tactical to strategic outsourcing.
Perhaps the most notable is Covance’s $1.6bn agreement with Eli Lilly, which also signed major deals with Quintiles and 3i at the same time as part of a major shift into outsourcing. Others include Novartis’ long-term relationship with Lonza for development and manufacture of biopharmaceutical candidates.
Dr. Ge Li, chairman and CEO of WuXi PharmaTech, said, "”Our partnership demonstrates the strength of our innovation driven and fully integrated R&D service platform."
The expansion of the deal comes after a rocky patch for WuXi. A collaboration with Covance that would have seen the companies partner on preclinical services collapsed earlier this month. Meanwhile, WuXi recently downgraded its earnings projections for 2008 after saying that it had experienced delays or cancellations in contracts from small biotech companies.