Bristol-Myers Squibb to expand activity in Israel

Among the largest pharmaceutical companies, Bristol-Myers Squibb Inc. is one of the least well-known in Israel.

By GALI WEINREB
pharmaceutical lab 311 (photo credit: Judy Siegel-Itzkovich)
pharmaceutical lab 311
(photo credit: Judy Siegel-Itzkovich)
Among the largest and most veteran pharmaceutical companies, Bristol-Myers Squibb Inc. is one of least well-known in Israel. Until recently, it did not have any activity in Israel, and it does not have any significant development agreements with an Israeli company. But behind the scenes, it has been active in Israel for many years and is now looking to expand its operations.
“We have decided to expand our activity in Israel following the launching of Yervoy, a drug that treats melanoma,” Rachel Humphrey, a Bristol-Myers Squibb vice president responsible for the development of Yervoy, told Globes. “We are cooperating with Israeli specialists, who have given us clinical and scientific information and valuable insights. We are currently building a relationship surrounding the drug.”
Bristol-Myers Squibb is a 150-year-old US company. Legend says that Edward Robinson Squibb, who was a surgeon in the US Navy, was disenchanted with the poor quality of medicines used on US military vessels and dumped them all in the ocean. In 1858 he started his own pharmaceuticals manufacturing business in New York.
At the same time, William Bristol and John Ripley Myers invested in a failing pharmaceutical company in New York and made their first fortune by developing salt laxatives and antibacterial toothpaste. A few years later, the three companies merged together to become Bristol- Myers Squibb.
The company was involved in various medical fields for years. It recently became more focused and narrowed its activity to medical issues and sold all non-medical company activity.
“Our business model integrates life sciences and pharmaceuticals,” Humphrey said. “We are trying to be as quick and innovative as a start-up. We are strengthening our culture of innovation without giving up the organization’s capability. Recently this has begun to pay off.”
Bristol-Myers Squibb launched four new drugs in 2011, an impressive number even for big Pharma.
“Our company, like others in the market, has become stricter in the way it manages the acquisitions budget and its support of initial science,” Ellen Lubman, director of Bristol-Myers Squibb’s Strategic Transactions Group, told Globes. “Today, Bristol-Myers Squibb are mostly acquiring companies that complement our portfolio.”
Lubman is concerned about the diminishing number of new companies.
“It is still the role of venture-capital firms to initiate new projects,” she said. “We, the pharmaceutical companies and Bristol-Myers Squibb in particular, take on products only after it is clear how our large-scale funding can help them progress. This usually happens during the regulatory and marketing stages.”

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“We are developing centers of excellence that comprise groups of researchers from various universities whom we support,” Humphrey said. “We will be publicly announcing this in the next few months.”
Where will the funding for the small companies come from if not from large organizations like Bristol- Myers Squibb?
Lubman: “I see a macroeconomic solution, which is not unique in our industry. It is difficult to bring about innovation when you are focusing on acquisitions. Therefore the IPOs must return. The moment capital markets reopen, the chances for exits will be higher, and more venture capital will become available.”

Some people claim that pharmaceutical companies don’t know how to develop drugs anymore and that they should focus on marketing and funding.
Humphrey: “I do not see any innovation crisis in Bristol- Myers Squibb. We have internal innovation, and there is no way we would give this up.”
Lubman: “Investors in pharmaceuticals are always interested in extreme scenarios. Pharmaceutical companies need to carry out clinical trials and to market their drugs, because they do this better than life-sciences companies.
Bristol-Myers Squibb’s careful approach toward acquisitions might disappoint anyone who believed that when venture-capital funding decreased, pharmaceutical companies would begin investing in start-ups, so that there would be companies worth acquiring later.
“We would be happy to present our investors with quality companies,” Lubman said. “We have done this for Israeli companies before. We are not able to assist with funding during the initial stages, but we can help by giving direction and guidance.”
Lubman recently participated in a conference for medical innovation at Tel Aviv University’s Lahav Executive Education Program, led by DFJ Tamir Fishman Ventures managing partner Benny Zeevi, in an effort to guide young companies.