Roche breaks ground on $300M diagnostics expansion

Roche broke ground on an expansion of its diagnostics headquarters, depicted in an artist's rendering--courtesy of Roche

Roche ($RHHBY) has been betting big on diagnostics of late, and the pharma giant is breaking ground on Phase I of its planned $300 million expansion of its Indianapolis Dx headquarters.

The first part of the project is the Learning and Development Center, a $70 million commercial education facility where Roche will train 1,500 people each year on how to use its products, the company has said. The rest of the $300 million project will be completed in steps over the next decade, consolidating most of Roche's diagnostics R&D and manufacturing in one place.

The educational center is designed to strengthen the company's relationship with its clients through training programs, Roche Diagnostics CEO Jack Phillips said. "As a key piece of our North American Headquarters, the new Learning and Development Center will serve as a hub and gateway for worldwide operations," Phillips said in a statement. "We felt that it was important for the building to reflect our global influence, right here in Indianapolis."

The Indianapolis expansion is a physical manifestation of Roche's increased focus on diagnostics, something the company has vowed to develop internally after its well-publicized failure to acquire Illumina ($ILMN) for $6.7 billion. CEO Severin Schwan has said that more than 60% of the pharma's pipeline treatments will be paired with in-house companion diagnostics, driving the need for Roche to boost its capacity in the field.

So far, the effort has paid off, as Roche reported 4% diagnostics revenue growth in the first 9 months of this year, bringing in $8.1 billion. Roche is raking in sales growth in all but its diabetes diagnostics unit, and the company is working to fix that, announcing last month that it will cut 100 jobs and restructure that business.

As for the expansion, Roche says in its announcement that once the project's done, it "will be one of the most unique structures in Central Indiana," a promising, if oddly specific, goal.

- read Roche's release

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