Expansions of in-house R&D will have no impact on CROs, say Pfizer and Lilly

By Dan Stanton contact

- Last updated on GMT

Lilly scientists working at an R&D facility
Lilly scientists working at an R&D facility

Related tags: Eli lilly, Contract research organization, Immune system

Despite expanding their in-house R&D facilities, both Pfizer and Eli Lilly say they remain committed to using CROs.

Pfizer announced last week it has expanded a lease agreement with Massachusetts Institute of Technology (MIT) for its Kendall Square Research Facility in Cambridge, MA, adding a further 130,000 of potential R&D space.

The site will focus on rare diseases, cardiovascular and metabolic disease, inflammation and immunology, neuroscience, and advanced biotherapeutic technologies.

Meanwhile, fellow pharma giant Eli Lilly is effectively doubling its R&D presence in San Diego, CA, adding 175,000 sq ft and potentially 130 new jobs at the Lilly Biotechnology Center. The announcement came just weeks after the firm committed to plans establishing a new drug delivery and device innovation centre in MA.

In-house vs CROs

The trends​ in the R&D space over the past few years have seen increased investment by the Big Pharma firms, but also an increase in contract research organisation (CRO) use to the detriment of in-house investment.

Pfizer​, for example, exited its Sandwich, UK R&D site in preference for outsourcing, while other firms including Sanofi​ and AstraZeneca​ have closed large research sites over the past few years.

However, both Pfizer and Eli Lilly told Outsourcing-Pharma.com these recent investments will not affect their contracts with third party companies.

“CROs continue to play an important role in our R&D strategy,”​ Pfizer spokesperson Dean Mastrojohn said, while Lilly’s Amy Sousa confirmed “Lilly will continue to use CROs,”​ despite the San Diego investment.

Financial figures

Both Pfizer and Eli Lilly have reported their second quarter 2015 financials in the past week.

Pfizer’s revenues dropped 7% for the quarter year-on-year to $11.9bn (€10.9bn), while Lilly’s remained fairly flat at just under $5bn.

But for R&D operational expenses, Pfizer saw a slight increase to $1.7bn attributed to incremental investment in the late-stage pipeline, primarily its cardiovascular candidate bococizumab.

Lilly, meanwhile, reported a 5% drop in R&D expenses mostly due to favourable currency exchange rates, though it expects R&D spend to be higher for the rest of the year as it commences Phase II trials for files for its growth factor monoclonal antibodies and olaratumab, and investigates additional indications for its cancer drug Cyramza.

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