Johnson & Johnson (NYSE:JNJ) is slowly
veering their way into the domain of healthcare technology by setting up
innovation centers in California, Boston, London and China. These places were
not random choices; they are currently the hub of biotech. Each center will
comprise initially of 15-20 employees, whose main job is to look for investment
ventures and potential partnerships relevant to drugs, medical devices,
diagnostics and consumer health.
The reason why J&J is setting up local
centers in order to capture new deals is because the competition among big-shot
healthcare companies has become extremely fierce with most of them looking to
small biotech firms for collaboration as a "partner of choice". The
reason why stakes are higher than ever is because most MNC’s are turning to
external science for help so that they can incorporate it into their products.
Loss of patent production on existing top-selling products and lack of
lucrative discoveries in their own labs have led them to take this step.
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Paul Stoffels, head of global pharmaceuticals
says that J&J has set a record for seeking external science for their
products as more than 50% of their offerings are a result of outside
collaborations. However, the company is now changing the way it associates
itself with the outside world by having a steady on-the-ground presence and
making the deals a whole lot simpler.
The new centers will plunge into activity in the
coming months. The Californian headquarters will be in San
Francisco , whereas the Chinese center will probably be in Shanghai . Last month,
J&J sealed a deal with Genmab, thus blending equity investment and product
licensing. If the experimental cancer drug daratumumab shows positive results,
the deal might be valued at $1.1 billion.
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