Roche closes manufacturing site and heads out west

By Nick Taylor

- Last updated on GMT

Related tags Genentech

Roche is closing its manufacturing facility in Nutley, New Jersey and relocating its centre of commercial operations in the US to California following its $46.8bn (€36.3bn) takeover of Genentech.

The companies finally reached an agreement last week after eight months of wrangling, with Genentech accepting a lower offer than it had initially wanted because of the downturn in financial markets.

Roche will now operate in the US under the name Genentech, because of its strong brand in the country, and move some of its divisions to South San Francisco where the biotech is based.

Among the causalities of this consolidation will be the manufacturing operations in Nutley and its Palo Alto, California research facility. Nutley will retain its research staff and be supplemented by the inflammation group working at the Palo Alto site, with the California facility’s virology research team relocating to South San Francisco.

Consolidation of the companies’ late stage development and manufacturing operations is also planned, with the intention of “achieving substantial scale benefits​”, but specific details of this are yet to be released.

Despite this alignment of operations Roche has been keen to stress that Genentech’s research and early development operations will remain independent, with the Swiss pharma saying it wants to retain the biotech’s talent.

This has been a major concern throughout the takeover negotiations, with some fearing that by losing its independence Genentech would struggle to retain the staff and corporate culture that have made it a success.

Part of this will involve retaining Genentech’s management, which many analysts and stockholders have said is unlikely to happen. However, Franz Humer, chairman of Roche, said: "I have a strong conviction that most if not all senior management will stay on​."

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