By Stanley Stark, FAIA, LEED AP
The life sciences arena has become more fragmented as Big Pharma has become more risk averse, bigger and less agile, and
as a more varied group of players have emerged
as challengers to Big Pharma’s dominant role.
Big Pharma’s size and diminished agility have
had two broad impacts. First, Big Pharma as a
global enterprise continues to re-align and consolidate. Pharma’s focus on speed-to-market and
multi-billion dollar blockbuster drugs have led
to growing impatience with the long timelines
and the risks imposed by the in-house R&D process. The pharmaceutical and biopharmaceutical
industries, the big dogs of the global life science
enterprise, are relying on a range of strategies to
reduce cost and risk and achieve greater agility.
Big Pharma has been shifting to a small R coupled with a big D model.
Second, a new version of mid-sized pharma
is growing by successfully managing reasonable
pipelines. Celgene, Biogen IDEC and Gilead are
examples of mid-sized companies who aren’t
encumbered by size and have some good, reasonably profitable, but not blockbuster-scale
products. This may be a harbinger of an eventual re-alignment of the pharmaceutical industry
into smaller faster moving enterprises.
The pharmaceutical industry is pursuing
strategies to enhance its dominant position,
but is also contributing to the creative destruction which is re-shaping the life sciences arena:
• Increasing reliance on biotech and academic
collaborations to conduct basic research and
identify effective compounds.
• Big Pharma continues to restructure its
research and marketing functions into
smaller units of 200 plus people organized
around therapeutic areas, and are locating
these groups closer to urban life science
centers—academic medical centers—to
take advantage of the intellectual capital and
cultural riches associated with our major
cities. The large, multi-functional suburban
research campus is no longer regarded as the
ideal research model for the research enter-
prise. The concentration of smaller thera-
peutic units representing pharma companies
and biotech startups in Cambridge and San
Francisco is evidence of this trend’s strength.
New York is becoming more aggressive to
capture more of these units.
• Merck is trying to buck this trend of outsourcing by reinvigorating its research arm,
while at the same time it’s aligning and
trimming its research headcount.
• Big Pharma has imposed tighter thresholds
on the approval steps as research moves
through the pipeline from bench to market. As a result, more potentially promising compounds which may not meet the
scheduled market targets are left behind
or have an uncertain future. Some of these
more promising compounds are adopted
by smaller pharma companies through
re-licensing agreements and further development as a next step in their evolution to
greater market presence.
• The drive toward consolidation has left
behind an excess supply of vacant or
underutilized facilities, particularly at suburban R&D sites. Pfizer, Wyeth, Schering-Plough and Hoffman–LaRoche have all
thrown major sites onto the real estate market for reuse or repurposing.
• There is also evidence that Big Pharma is
interested in making small research investments in future markets by developing
small R big D facilities.
In response to Big Pharma’s drive to outsource
research, academic research universities and
medical centers have become more entrepre-
neurial. Both the university and its faculty scien-
tists have moved to capitalize on the intellectual
property they have created or for which they
have provided the resources and investment.
This new role and the potential revenues creat-
ed have led to new enterprises combined with
the need for new, different, better space. The
limitation most young S&T enterprises face is
the absence of space for development-scale oper-
ations, a gap most urban bioscience incubators
have not filled. But as the need has become more
obvious, the urban real estate markets are find-
ing locations and ways to address it.
As campuses become denser and more congested—universities loath to tear down older,
obsolete facilities—relocation and cost-effective re-development opportunities diminish.
To meet their need for more and better space,
universities increasingly turn to the real estate
industry to provide the space needed. This rep-
resents a potent and growing set of opportunities
for economic development agencies, developers,
building owners and real estate brokers.
Consumer product firms, particularly com-
panies that produce products for human con-
sumption, are relying more heavily on R&D
to improve and market their products. R&D
functions in these companies, which were
formerly captives of manufacturing divisions,
have shifted forward and are now allied with
marketing, brand management and strategy.
The cost of new and renovated S&T facili-
ties is on the rise again. There are numerous
drivers, but the key issue is that the hiatus in
rising construction costs that took hold during
the most recent recession is over. New S&T
facility construction will cost $650 to $700 in
New York City—$ 520 to $585 and $560 to
$630 nationally, for example, 80 to 90% of the
New York area costs. Gut total renovation will
range from $450 to $500 in New York City—
$360 to $405 and $400 to $450 nationally,
again 80 to 90% of New York area costs.
New building models may be emerging
where multiple companies have lab space
located on the same floor, licensing and VC
offices are in the mix and there’s shared space
on another floor for development activities. It’s
the integrated research campus shrunken down
to the size of a manageable urban building.
In response to the new and emerging styles of
work and S&T enterprises, some new models of
facility organization are likely to arise.
In the wake of these forces and cross-cur-rents we are likely to see a greater convergence
of facility types, creating more hybrids and
shared facilities employing re-purposed urban
buildings seeking new users.
Big Pharma and new directions in the life sciences arena
; STANTEC AUTHORS CHAPTER IN BOOK ON DESIGNING TEACHING LABS
Three Stantec designers who specialize in education facilities have authored a
chapter in a new book about designing teaching labs. Published by the American
Chemical Society, Innovations and Renovations: Designing the Teaching Laboratory highlights projects, best practices and considerations for academic institutions
embarking on a lab construction or renovation project. The Stantec chapter, titled
“Pressure Point: Balancing the Competing Demands of Chemistry Lab Design”,
examines the options lab owners have for finding a balance among the sometimes
competing factors of safety, space utilization and energy efficiency during the
design process. The chapter analyzes the pros, cons and expected savings or concessions of different design choices and gives examples of ways to creatively use
lab space to meet program goals.