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Innovation more critical than ever

This Advertising Feature has been commissioned, edited, and produced by the Science/AAAS Custom Publishing Office

The year 2009 has been a time of change for the biotechnology and pharmaceutical industry. With a weakened global economy and dwindling drug pipelines, many of the companies that made the list of Science's 2009 top employers are finding that maintaining innovation through collaborations and partnerships is critical to success.

The global economic meltdown severely damaged many industries. Although the pharmaceutical industry is normally relatively immune to economic turndowns, most biotechnology and pharmaceutical companies have had to find ways to tighten their belts. In addition, for many of them the pipeline of promising drug candidates has dried up at around the same time that existing drugs are set to lose their patent protection. To feed pipelines and cut costs some companies have merged, while many others have formed partnerships.

The shifting political landscape has also brought change. In the United States, the ongoing push for health care reform may mean that drugs will soon be marketed differently. And heightened public concern about drug safety has resulted in new legislation that will lead to more stringent safety regulations by the US Food and Drug Administration (FDA).

But not everything is changing. For one thing Genentech, now a wholly owned member of the Roche group, has not budged from its No. 1 position in this year's Science survey of top employers in the industry. "We are delighted to once again be named top employer by Science magazine," says Marc Tessier-Lavigne, Genentech's executive vice president for research and chief scientific officer. "The honor is a real testament to Genentech's unique culture and to the dedication of our employees." The company held on to the No. 1 spot despite the fact that at about the same time the web-based survey was being completed in March 2009, Genentech was acquired by the Swiss company Roche.

The over 2,000 people who responded to the top employer survey selected companies, including their own, that they regarded as best, average, and worst employers. And although they shuffled places somewhat, most of the companies who made it to the top 20 list (see Top Employers Table) were on that list last year and the year before that. One exception is Syngenta Techonolgy. A company providing seeds and crop protection products, Syngenta made the list for the first time this year at No. 20.

Between Genentech and Syngenta, the top 20 employers include Boehringer Ingelheim at No. 2, followed by Genzyme and then Monsanto. Millennium: The Takeda Oncology Company, which took its new name after Millennium was acquired by Takeda Pharmaceuticals in May 2008, came in at No. 5, followed by Merck KGaA, Schering-Plough Corporation, Amgen, Gilead Sciences, and Johnson & Johnson at No. 10. Next came Eli Lilly and Company, Novartis, GlaxoSmithKline, AstraZeneca, Biogen Idec, Merck, Roche, Wyeth, and sanofi aventis. Among these top 20 companies, 12 are headquartered in the United States, and eight are in Europe.

As in previous years, all survey takers rated the companies they had chosen on 23 driving characteristics. Being an innovative leader in the industry remains the most powerful driving characteristic of top employers. In addition, doing important, quality research, being socially responsible with loyal employees, having leaders who keep the organization moving in the right direction, having values that are aligned with employees' personal values, and treating employees with respect are the other important drivers selecting the best company.

All companies on the top 20 list received high marks for these drivers, with some companies doing better on some drivers than others (see Top Twenty Employers table).

Innovation is key

Being a leader in new discoveries and innovation is what many of the companies on the top 20 list strive to achieve. For three consecutive years, this driver was the top criterion among survey takers in selecting the best company to work for.

The 20 companies with the best reputations as employers and the top three driving characteristics for each company, according to respondents in the 2009 survey undertaken for the Science Business Office. The companies without a 2008 rank did not receive enough mentions to qualify during the 2008 survey.

At Amgen "we look for approaches to disease that have never been pursued," says Roger Perlmutter, executive vice president for research and development. "We avoid me-too research." A recent example of innovative science is the development of an antibody that targets a protein secreted by bone cells and that inhibits bone formation. That research, according to Perlmutter, has revealed fundamental insights into bone biology, as well as being developed as a possible treatment for bone diseases.

"We don't do work where someone has already pursued a target and we can make another version of that drug," says Perlmutter. "That is not to say that kind of work is unimportant. Changing a drug so that it can be taken once a day rather than twice a day makes a big difference in a patient's life. But it's not what we do."

The focus on innovation is just as important for other types of biotechnology companies, even ones that are not in the business of making drugs. "Over the course of time we have proven that we are leaders in innovation," says Roger Kemble, head of crop genetics research and interim president of Syngenta.

(Last year, for the first time ever, a company outside the biopharmaceutical business reached the first tier of top employers—2008 survey respondents voted Monsanto into second place after Genentech. This year Monsanto dropped to fourth place, but Syngenta, another company that applies biotechnology and traditional chemistry to the development of agricultural products, made the list of top employers for the first time.)

Top Employers Survey Demographics

"We pursue innovative ideas that did not exist before. We are not improving something that existed. We are starting from a clean slate, using sophisticated tools and talented people to bring plant potential to life," says Kemble. "Innovation comes from realizing that research can only advance if we have innovative people to advance it and if we give them time and space to innovate."

One way in which the company rewards innovation is through an internal awards program. "It's a bit like the Oscars for us," says Kemble. Syngenta employees who had innovative ideas that were later put into practice submit written descriptions of their projects. A special committee then selects the best projects. In 2008, the program had record participation, with around a thousand projects submitted, representing 9,400 employees around the world, about two-thirds of the total work force.

Maintaining the edge

Given the recent economic turmoil and the fact that patent protection on many successful drugs is set to expire in a few years, maintaining innovation is more essential than ever to a company's survival. And each company has gone about increasing and maintaining innovation through different approaches.

"We have a new CEO, Andrew Witty, who has been incredibly dynamic in helping the company understand that the old pharma model has to change," says Nigel Broom director of UK R&D recruitment at GlaxoSmithKline (GSK), the largest pharmaceutical company in the UK. "And that we will be leaders and not followers in that change."

To increase its early pipeline, GSK has shifted focus to scientific areas that are most likely to lead to new medicines. Together with vaccines, GSK's R&D is now focused on biopharmaceuticals, immunoinflammation, infectious diseases, metabolic pathways, neuroscience, oncology, ophthalmology, and respiratory conditions. "We have been making the change for a while, certainly in R&D," says Broom.

In addition, the company has expanded collaborations with external partners as well as with academia. Recent alliances include organizations such as Cellzome and the Harvard Stem Cell Institute, as well as the acquisition of small biotech companies like Sirtris and Genelabs.

The year 2008 saw the creation of discovery performance units (DPUs) within GSK. Each DPU is a compact, fully empowered focused and integrated team which has responsibility for a small part of the pipeline. "Each DPU has guaranteed funding for three years and then the funding is reassessed," says Broom. "They are run as mini businesses and people are very engaged. They have to regularly justify why they need continued funding." These units, which had been running for about six to nine months by the time this article went to press, are "reflective of the changes that are going on at GSK," says Broom.

GSK monitors the level of satisfaction among its employees on a regular basis through a survey aptly called PULSE. "We have done a fair bit of changing. At first people were uncertain about it, but the approval numbers have now bounced back and gotten higher," says Broom. "There is enthusiasm for the work and a commitment to it. There is a lot of commitment to Witty and the path he is taking us."

The importance of research

One of the key ingredients of innovation is cutting-edge research. This year's survey respondents identified "research quality" as one of the top six drivers of the best employers—a characteristic that was not on the list last year (see Driving Characteristics of Top Employers).

Over 90 percent of survey takers who selected the top four employers (Genentech, Boerhringer Ingelheim, Genzyme, and Monsanto) agreed that these companies engage in important, high-quality research. In addition, doing high quality research was among the top three drivers for 18 employers out of the top 20 (see Top Twenty Employers table).

"Genentech was founded on doing great science, with a focus on translational research," says Genentech's Tessier-Lavigne. Genentech's co-founder, Robert Swanson, who died in 1999, often referred to the importance of Genentech's employees by saying, "our most valuable assets go home every evening in tennis shoes," recalls Tessier-Lavigne.

Tessier-Lavigne is one of several established scientists who were brought to Genentech's top management from academia. Because of its focus on high-quality research and informal atmosphere, Genentech has long been viewed as a cross between academia and industry. Vishva Dixit, vice president of physiological chemistry, joined Genentech in 1997 from the University of Michigan. "When people ask him 'What is it like working in industry?' he answers 'I don't know, I went to Genentech,'" says Tessier-Lavigne.

Genentech's employees value "being part of a science-driven culture and one with very little hierarchy," he adds. "But what inspires them is being focused on improving patients' lives. That's what motivates us here."

Flat hierarchies

It comes as no surprise that scientists don't like hierarchy and most companies that made the top 20 list understand that. Representatives from these companies typically describe their company's environment as being open and with little top-to-bottom decision making.

"Scientists live for initiatives, they live for motivation. They need to be taken seriously and not micromanaged," says Gerd Schnorrenberg, senior vice president for research for Boehringer Ingelheim, based at the company's largest research site in Biberach, Germany. "We have very flat hierarchy in research. Our scientists report their project results in management meetings directly to board members."

With 41,300 employees worldwide, Boehringer Ingelheim has 1,700 researchers (out of a total of 6,700 employees in the whole research and development area). A relatively small research group helps maintain informal and open communication. "Among us researchers, we all know each other quite well," says Schnorrenberg.

Black type indicates the characteristics in common for the two years.

The company has performed several so-called landmark studies. For example, the results of one study, known as UPLIFT, one of four large-scale studies conducted in 2008, demonstrated the effectiveness and safety of a drug called Spirivain about 6,000 patients with respiratory disease.

Other studies conducted by Boehringer Ingelheim researchers have shed light on important biological processes. The first results from the European Cooperative Acute Stroke Study showed that treatment with a compound called alteplase between three and four and a half hours after the onset of stroke improves the outcome for patients. "The discovery of this enlarged window of opportunity provides a benefit to patients," says Schnorrenberg. "These types of studies go beyond safety and efficacy. They provide information on how drugs can be used to treat a disease."

Because the company is privately owned, "we are able to invest in mega trials without any concerns about how Wall Street will react," says David Nurnberger, senior vice president, human resources at Boehringer Ingelheim Pharmaceuticals, the company's US affiliate. "We have no public stock, so we can maintain a long-term view. We can invest in large, sometimes long, trials to get the data we need."

Valuing employees …

In addition to a commitment to research and little hierarchy, other characteristics common to companies in the list of top 20 employers include respecting employees and having loyal employees.

"Trust and respect is the core value of the company," says Amgen's Perlmutter, "Everyone is schooled in it. Everyone has the opportunity to contribute and feel respected." That respect has created an atmosphere where employees take pride in the company's accomplishments and are comfortable in sharing their thoughts with management.

After a recent announcement of the results of a Phase 3 trial of Amgen's drug denosumab in the treatment of bone metastases in over 2,000 patients with advanced breast cancer, Perlmutter says he received many messages from employees who were supportive of the research. "A lot of messages were very personal. Some were from metastatic cancer patients, some had family members who were suffering from cancer," he says. "They were all heartfelt."

Both employees and management value open communication. "We have roundtable discussions where executives, including our CEO meet with a random group of 10 employees at a time and openly respond to whatever the employees want to talk about," says Craig Schneier, executive vice president of human resources at Biogen Idec. "They are very candid exchanges."

A company of about 4,700 employees, Biogen Idec has been conducting these roundtable discussions for several years, tapping about a thousand1,000 employees a year. "Our employees express a lot of confidence and support for leadership and part of the reason is that we actively communicate with them," says Schneier.

Having remained a family owned-company since 1885 has shaped the culture at Boeringher Ingelheim. "We have established a culture based on respect for our employees," says Nurnberger. "With every decision we take, we try to ask thesefour questions: Are we taking innovative approaches? Are we connected? Are we growing together? Are we delivering results?"

At Johnson & Johnson the values that guide decision making are spelled out in the company's Credo, according to Anuk Das, assistant director of immunobiology at Centocor R&D, a Philadelphia-based subsidiary of Johnson & Johnson.

Robert Wood Johnson, former chairman from 1932 to 1963 and a member of the company's founding family, crafted the Credo in 1943, just before Johnson & Johnson became a publicly traded company. "What is impressive is that the Credo is still carried out today," says Das.

Johnson & Johnson's Credo lists the company's four priorities in order of importance. It states that the "first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services…. We are responsible to our employees, the men and women who work with us throughout the world…. We are responsible to the communities in which we live and work and to the world community as well…. Our final responsibility is to our stockholders."

"For me, my loyalty for Johnson & Johnson comes from the Credo and the demonstration that our leaders use it as a guide to make decisions," says Das.

… and communities

One recent example of Johnson & Johnson's Credo at work is a collaboration between Centocor and the University of Michigan to increase diversity in the sciences.

Under the program, University of Michigan and Centocor scientists will jointly develop research programs. The University of Michigan will then recruit postdoctoral fellows from populations that are traditionally underrepresented in the sciences, who will have the opportunity to work on these projects at both the university and the Centocor campus with a mentor at each location. "We are very excited to increase our talent pipeline. The program expands diversity but also increases the opportunities for new scientific discoveries," says Das. The program, which started in December, is just now in the process of recruiting the first postdoctoral fellows.

Other companies have made education a focus of their outreach efforts. For example the Amgen Scholars Program, a $27.5 million initiative, provides undergraduates the opportunity for hands-on research at some of the world's leading universities, including Massachusetts Institute of Technology and the University of Cambridge, UK. "I hear a lot of discussion about the value of the scholars program when I travel," says Perlmutter. "It is really well received."

Other philanthropic work by top 20 employers includes the Syngenta Foundation for Sustainable Agriculture ( established in 2001. Its purpose is to help small farmers in resource-poor settings, in developing countries, and emerging markets become more professional growers.

For example, in Mali, the foundation works with the government to support a research station that raises local varieties of millet and sorghum, develops cultivation techniques adapted to the needs of the region, and trains small farmers in their use. In certain areas of India, the foundation is providing support for building structures in which to store grains and other crops. "We work with rural communities to improve the lives of farmers by helping them build infrastructure," says Kemble.

According to survey responses, employees value working for companies that are socially responsible and committed to their employees and communities. And companies are aware of this. Most companies interviewed for this article encourage their employees to take time off work to volunteer in the community. Many also have programs in place to make medicines available to people who need them at reduced or no cost.

Mergers and acquisitions

It may be challenging for a company to do right by its employees at the time of a merger or acquisition. Such steps are often accompanied by layoffs, in some cases leading to the loss of thousands of jobs. On the upside, survey respondents pointed out that mergers can provide a company with access to a pipeline of new products and the chance to cut costs, ultimately benefiting employees.

This year has seen many high-profile mergers and acquisitions. In January 2009 New York-based Pfizer, maker of the blockbuster drug Lipitor, which loses patent protection in November 2011, announced plans to buy Wyeth. In March Merck & Co. bought Schering-Plough Corporation (both companies made the list of top employers at positions 16 and 7, respectively).

In March 2009 Genentech became a wholly owned member of the Roche group, headquartered in Basel, Switzerland. Under the new organizational structure, Genentech Research and Early Development program, dubbed gRED, which essentially comprises basic research up to Phase 2 clinical trials, will maintain its autonomy. "The leadership at Roche knew the strength of our research program and wanted to maintain what we had developed here," says Tessier-Lavigne. "They have left us independent, so we have been able to maintain our research culture without missing a beat."

The merger did of course cause some changes. Arthur Levinson, Genentech's former chair and CEO, and Susan Desmond-Hellmann, former president of product development, both left the company. (In May 2009, Desmond-Hellmann was named chancellor of the University of California, San Francisco.) But as far as Genentech's research focus and unique culture—which includes a vibrant postdoctoral program as well as free cappuccinos and Friday evening parties—are concerned, those will not change, says Tessier-Lavigne. "We have maintained our momentum throughout the merger and now we are moving on to the next exciting chapter in our company," he says.

Happy takeovers?

Is a smooth takeover really possible? Apparently yes, according to Joe Bolen, chief scientific officer at Millennium.

Established in 1993 as a genomics company, Millennium has since grown into a fully integrated biopharmaceutical company. In May 2008 the company was acquired by Takeda Pharmaceutical Company Limited, the largest pharmaceutical company in Japan. Millennium, now renamed Millennium: The Takeda Oncology Company, operates as an independent subsidiary serving as Takeda's global center of excellence in oncology.

Under Takeda, Millennium has been involved in a larger number of clinical trials and has been testing new compounds obtained from its parent company. "But the philosophy of the earlier research and development has not changed," says Bolen. "We worked hard when Millennnium was first set up to figure out the best things to do. We worked out procedures to make early-phase research as seamless as could be. Under Takeda, we were able to continue the same processes and maintain our culture and focus."

The strategy appears to be paying off. In April 2009 the company published an article describing a new molecule that modulates the levels of proteins critical to the regulation of cancer cell growth and survival. The compound has now moved forward to Phase 1 studies.

"We were reassured we would maintain our identity and independence and I am happy to say that the president of Takeda, Yasuchika Hasegawa, kept his word and allowed us to flourish," says Bolen. "Most takeovers are not happy, but this is an acquisition that will be a success story." Perhaps that is why, after the acquisition Millennium has moved to fifth place in the top employers survey, up from No. 8 in 2008 and 13 in 2007.

Innovation through collaboration

Some companies have made it part of their mission to keep away from mergers and acquisitions. "We are a very independent company and always plan to be that way," says Rich Gregory, Genzyme's senior vice president and head of research. "The acquisitions within the pharma industry are symptomatic of many companies with relatively weak pipelines that are acquiring innovation by consolidating with larger companies to reduce expenses." But Genzyme has taken the approach to invest in research internally, as well as establishing numerous collaborations with other companies and academic researchers, explains Gregory.

Comparison of the top 10 companies on the basis of the top 3 drivers (scored out of 100): Loyalty (bubble width), Innovative (x-axis), and Treats employees with respect (y-axis).

For example a collaboration between Genzyme and PTC Therapeutics led to experimental new drugs with potential to address many devastating genetic diseases including Duchenne muscular dystrophy and cystic fibrosis. "Those drugs are based on an entirely novel technology that we acquired though collaboration," says Gregory.

Being able to acquire new technologies, as well as becoming more innovative internally by venturing into new research areas, such as stem cell and gene therapy research, have allowed Genzyme to maintain its edge. "We evolve constantly. We are not a static company, but will change as the business changes," says Gregory. "At the same time, our employees value working for a stable company."

Indeed a common theme for employees at top-tier biotechnology or pharmaceutical companies is the opportunity to collaborate with a wide range of researchers from different backgrounds and get exposed to different technologies and fields of research. "We are constantly innovating. It is probably a lot more fun for employees," says Gregory.

Employees also have more opportunities to work abroad as many companies have affiliates in different parts of the world, including Asia. Cambridge, MA-based Genzyme, for example, a company of about 11,000 employees, has 85 locations in over 40 countries. Boehringher Inghelheim has 138 affiliated companies in 47 countries.

Stable environments

Boehringer Ingelheim, a privately held company, is among the ones committed to independence. "You have to find the right balance between continuity and change. We see the necessity to change and to adapt to future challenges," says Schnorrenberg. "One way to cope is not to merge, but to collaborate with academic labs and startups."

The strategy has helped the company be financially successful, according to Schnorrenberg. "We increased our R&D budget by 22 percent in 2008. Not too many companies have been able to do that," he says. "Part of the reason is that we have not been saddled with all the costs that go with mergers and acquisitions."

The strategy is also reassuring to employees. "Our employees are not worried about the company being acquired; that is a really important facet of working for Boehringer Ingelheim," says Nurnberger. "We receive many applications from people from other companies who complain about constant changes in direction and management. We are attractive to talented individuals looking for a stimulating working environment in a privately owned company."

This year's survey identified that there were slightly more job seekers in the market (30 percent compared to 27 percent in 2008). Fewer people this year were looking for a new job for career advancement than last year, but more are moving because of "company direction" and for reasons related to mergers and acquisitions or expected layoffs that were taking place at the survey taker's company.

Working for the greater good

Despite the dwindling pipeline and economic challenges, survey participants still say that the biotech and pharmaceutical industry is a good fit for their aspirations. One of the main advantages of working in this industry, according to the 2009 survey, was advancing the health of people and working for the greater good.

At GSK, employees are constantly reminded of the value of their work. "We invite patients to come to our company and talk about their experience," says GSK's Broom. "It makes our work very personal. It is a real motivator for everyone."

Amgen's Perlmutter agrees. "We focus on unmet needs and make better and safer medicines that will save lives," he says. "Our very mission is socially responsible."

But doing work that benefits mankind is not unique to companies in the business of making medicines. "Why do people want to work for us? Our work has a direct impact in helping to feed and clothe the world," says Syngenta's Kemble. "The world population is 6.7 billion and predicted to increase by 1.5 billion by 2030. And the available landmass is reducing. We develop and sell products that can produce more on less land and our people are motivated by being a part of that."

In addition to a socially responsible mission, other advantages of working in the biotechnology and pharmaceutical industry, as identified by survey takers, were: engaging work and being part of cutting-edge research and development; innovative, creative, and fast-paced work; and stability in difficult economic times, including generous salaries, benefits, and job security.

On the flipside, survey takers also identified two main disadvantages of working in this industry. They include job insecurity due to mergers and acquisitions, as well as some reprioritization and downsizing due to the global economic meltdown and the negative public image perception caused by withdrawn products and safety issues.

High-profile drug-safety incidents in recent years have chiseled away at the public perception of industry. One of the more damaging incidents was the withdrawal of Vioxx in 2004, but since then several other drugs have been taken off the shelves. In addition some drugs have been revealed to have dramatic side effects, so that they can only be given to select patients through a restricted-use program. Others have led to serious warnings, for example, the overuse of antidepressant drugs in children. In addition, several vaccines, such as the AIDS vaccine, have failed to deliver on their promise.

"Any time you are dealing with powerful medicines, you have the potential issue of safety. As a company we make sure we do everything above board and carefully," says Biogen Idec's Schneier. "Employees want to know that the company they work for is ethical and transparent and has done all the right things."

Because of the heightened awareness of drug safety the US FDA has stepped up regulations pertaining to drugs. "Safety issues are featured daily. It reflects the fact that the public is concerned," says Amgen's Perlmutter. "Sometimes you hear people working in the pharma industry grumble about all the regulatory requirements. But I like regulations. They push us to do a better job."

While survey participants expressed concern about the economy, many of the companies interviewed by Science say that the pharmaceutical industry has faired better than others. Although the economic situation has forced most companies to cut down on expenses, several companies still managed to increase their R&D budgets in 2009.

"This is an area where there are still a lot of opportunities and growth, " says Schneier "We are not affected as much by the economy." He adds, however, that having close to 5,000 employees, Biogen Idec has had an easier time of navigating the economy. "A lot of small biotech companies have been affected by the economic situation. It has been difficult for them."

Still the best of times

Despite the challenges, the main mission of the biotech and pharmaceutical industry will always be what attracts people to the field. "What I focus on is the reason why I chose to be a scientist," says Johnson & Johnson's Das. "I wanted to develop medicines to treat diseases. That is my focus. There are still many diseases with no cure."

And for those interested in doing this kind of research, there may not be a better time than the present. "What motivates people here is that the level of scientific opportunities has never been greater. There has never been a better time to be in disease research and translational medicine," says Genentech's Tessier-Lavigne. "We will have the biggest impact on human health. Our ability to deliver great medicines has never been better. With advances like the human genome project, we are in a position to tackle disease with the same approach and rigor used in basic research."

Others share Tessier-Lavigne's enthusiasm. "I wish I was 20 to 30 years younger and getting into this business now," says Millennium's Bolen. "I look at the contributions that scientists in industry are making. The quality of science in biotech and pharma is world class and much is done in collaboration with academic labs. There is a high level of excitement in the scientific world."

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