Roche's ($RHHBY) decision to shutter its big R&D complex in Nutley, NJ, is causing some serious heartache in the state, which has long been known as the home to a wide variety of biopharma companies.
The Record tallied the state record and found that New Jersey, which once hosted one of every 5 pharma jobs in the country two decades ago, now can boast of a little more than one in 10. And its research facilities are taking a beating. Roche's cutbacks follow a decision at Sanofi late last year to cut its R&D ops in the state, putting 1.3 million square feet of once-prime biopharma real estate on the market. Cushman & Wakefield is trying to market Pfizer's 2.8 million square foot complex in nearby Pearl River, NY. And Merck's takeover of Schering triggered a decision to dramatically downsize its facilities in Kenilworth.
"This is the third extremely large site in the area that is now going to be either totally vacated, or partly vacated," Cushman's Christopher Kinum tells GlobeSt.com about the Roche move. "Conservatively, that makes about five or six million square feet of expensive research/lab space available."
James Hughes, a public policy professor at Rutgers, tells The Record that the state lost its edge as the old focus on traditional small molecules gave way to the current focus on biologics. The state's aging research facilities lost their rep for cutting-edge research, but Hughes believes that a recent move to merge several colleges could put New Jersey back on track.
The idea is to create the kind of academic center of excellence that has drawn Big Pharma R&D to Boston/Cambridge, San Francisco and Cambridge in the U.K. Theoretically, that's a workable approach, but leading universities have stolen a march on New Jersey's academic institutions, and making up ground in this field is notoriously hard and slow. Once off the beaten path in biopharma, it can take many years to find the road again.