When Roche bought out Genentech back in '09, analysts fretted over the looming culture clash as the corporate types of Basel invaded San Francisco. But to hear Reuters' Caroline Copley tell the tale, the real showdown was taking place between two distinctly different R&D operations. And three years later San Francisco proved the winner, hands down, in a technical knockout.
Today when Roche ($RHHBY) talks about its top drug prospects, the chances are it's referring to one of Genentech's programs, like the promising antibody-drug conjugate T-DM1. That rep eventually persuaded Roche to prepare to lock down its site in Nutley, NJ. And the business news service reports that in the aftermath of the big closure Roche and Genentech will each have a pharma research and early development division with about 2,000 people in it.
Call it a reverse merger, with Genentech emerging as the dominant player.
"In essence, the merger of Roche and Genentech was about Genentech going global," Vontobel analyst Andrew Weiss tells Reuters. "At the time they probably had the upper hand and I think that hasn't changed."
The stinging assessment of Roche's R&D ops is capped with the bitter setback over dalcetrapib. Roche research chief Jean-Jacques Garaud once told reporters that dalcetrapib had the potential to go on to earn $10 billion. Two months ago, it wasn't worth 10 cents. And Garaud was headed out the door, soon to be followed by another 1,000 R&D staffers who backed the wrong horse.
- here's the article from Reuters