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Novo Nordisk will cut 400 jobs and increases its investments in new innovations

NovoNordisk-research-obesity-JohanPaulsson-highres

The company recently announced that it will lay off 400 R&D staff and last week it announced the establishment of a stem cell therapy manufacturing site in the U.S. and new digital health agreements.

The company, which employs 42 000 people in 79 countries, said the lay off, which concerns staff in Denmark and China, is made in order to divert funding toward investment in biological and technological innovation. The company plans to restructure its R&D organization to accelerate the expansion and diversification of its pipeline across serious chronic diseases.

For example, lately, the company has announced the acquisition of the UK-based biotech start-up Ziylo to enhance research within glucose-responsive insulins and a number of partnership agreements with universities and biotech in the fields of cardio-metabolic and stem cell research.

Transformational Research Units

To support the new strategy, Novo Nordisk will establish four Transformational Research Units in 2018 to pursue novel treatment modalities and platform technologies.

The biotech-like units, based in Denmark, the US and the UK, will operate as satellites of Novo Nordisk’s central R&D function and will drive innovation in priority fields such as translational cardio-metabolic research and stem cell research, it states.

A stem cell therapy manufacturing site

A few weeks after the announcement of the reorganization the company announced the establishment of a manufacturing site in Fremont, California, US to develop and produce stem cell-based therapies. The announcement follows the signing of a long-term lease on a good manufacturing practice (GMP) facility, previously operated by Asterias Biotherapeutics. Once operational in 2019, the facility will fullfil the supply of stem cell-based therapies for Novo Nordisk’s clinical trial programmes, the company reports in their press release.

“Our ambition is to develop stem cell-based therapies for a range of serious chronic diseases where we see significant unmet medical need,” said Jacob Sten Petersen, corporate vice president and head of Stem Cell Research & Development (R&D), Novo Nordisk. “The reliable, large-scale supply of therapies is a vital component in our efforts, so I am delighted that we have established this facility that further demonstrates our strong commitment to this field.”

In addition to the lease agreement, Novo Nordisk has secured a two-year non-exclusive license on Asterias’ intellectual property relating to stem cell manufacturing technology. Novo Nordisk will sublease laboratory, manufacturing and office space within the facility back to Asterias until the end of 2021.

Novo Nordisk’s R&D in this field is anchored in its recently established Stem Cell Transformational Research Unit, based in Måløv, Denmark. The unit oversees multiple partnership projects pursuing stem cell-based treatments for diabetes, Parkinson’s disease, chronic heart failure and dry age-related macular degeneration (AMD). The new production facility will directly support these projects, enabling the future expansion of Novo Nordisk’s stem cell research portfolio into the clinic.

Automation and digital capabilities

Furthermore, following the new strategy, Novo Nordisk will increase its investment in automation and digital capabilities including machine learning and artificial intelligence (AI). The integration of laboratory infrastructure and IT systems will also be prioritized to increase the efficiency of the R&D organisation, it states.

Announced on October 1st, Novo Nordisk signed new partnership agreements with Dexcom, Glooko and Roche. The agreements will support the future integration of the company’s connected insulin pens, NovoPen 6 and NovoPen Echo Plus, which will become commercially available early 2019 across key markets, states the company. Building upon its existing work with IBM Watson Health and Glooko, Novo Nordisk aims to integrate insulin dosing data from connected pen devices with its partners’ open ecosystems and diabetes management solutions, such as data from continuous glucose monitoring (CGM) systems and blood glucose meters (BGM).

“Our non-exclusive partnership strategy allows us to integrate with the various digital platforms that people are already using to help manage their diabetes,” said Camilla Sylvest, executive vice president of Commercial Strategy & Corporate Affairs at Novo Nordisk. “We firmly believe that this will help more people realise the full benefit of our innovative medicines and begin to ease the mental burden of diabetes treatment for those individuals.”

Photo of Obesity R&D at Novo Nordisk A/S, Måløv, Denmark, 2015, Johan F Paulsson