ShangPharma opens new plant to meet Lilly's R&D needs
In November, Outsourcing-Pharma broke the news that the China-based contract research organisation (CRO) would use the plant for an un-named major customer’s operations as part of its plans to strengthen relations to its top clients.
After this month opening the facility – which includes laboratory and office space – the firm announced it would be dedicated to supporting Lilly’s on-going and future projects. The ribbon-cutting coincides with a multi-year extension of ShangPharm’s contract with Lilly.
“We are delighted to extend and deepen our highly productive relationship with Lilly,” said Michael Xin Hui, founder and CEO of ShangPharma.
“Renewing our agreement to serve as a key support partner for Lilly's discovery services is a clear indication that international pharmaceutical companies appreciate the high quality of ShangPharma's team and the excellence of our R&D capability.”
Neither firm gave any hint towards which projects Lilly will carry out in the new lab.
However in November, Hui said the site will accommodate continued fast growth for in-vivo pharmacology, with oncology and metabolic disease work particularly in demand.
Bleak forecast
The news backs Lilly’s recent announcement that it will increase R&D (research and development) spending in 2012 despite a steep projected drop in profits.
Commenters attribute the decline in large part to the firm’s Zyprexa schizophrenia treatment’s patent expiry – a gem which has earned $4.5 billion-a-year for the company.
When Outsourcing-Pharma contacted the firm to ask how the falling funds would affect outsourcing, those in the know were unavailable for comment.
However on a conference call earlier this week, CFO Derica Rice said that Lilly had been preparing for Zyprexa’s generic competition with a streamlining plan that has seen it cut more than 7,000 jobs since 2004.
“Having substantially reduced our infrastructure, we are positioned to fund the R&D that will drive our future growth” Rice said.
