Vasella’s boldest move came in 2002, when he abandoned the traditional drug-development model, declaring Novartis would only investigate diseases for which new drugs were desperately needed and where there were a solid scientific basis or hypothesis of the mechanisms
(genetic and/or pathways) leading to the target illnesses. While other CEOs saw the pursuit of rare diseases as commercial suicide, Vasella believed many of the illnesses shared genetic underpinnings with more common ailments.14
Historically, both Sandoz and Ciba leaders felt they could attract the best scientists in the world to work in Basel. In contrast, Vasella felt the company needed to be where the talent pool was located and that Novartis needed to attract the top scientists in the U.S. Consequently, he shifted Novartis’s global research headquarters to the U.S. by establishing the Novartis Institutes for Biomedical Research (NIBR) in Cambridge, MA near Harvard University and MIT. While the Basel research site was maintained, the company closed its research center in New Jersey, transferring key scientists to Cambridge. The original investment was $1 billion.
To head NIBR, Vasella recruited Mark Fishman, M.D., chief of cardiology at Massachusetts General Hospital, a geneticist and top scientist. “We needed an M.D. with a modern approach to research with vast knowledge of molecular biology and genetics, and with broad clinical experience,” Vasella explained. His decisions set off a firestorm in Basel. Concerns were voiced about “abandoning Basel” and hiring an American academic medical scientist without industry experience.
Fishman recalled, “The original idea was actually to have a research site in the Boston-Cambridge area, but I thought it had to be the headquarters for research. You can’t change an organization by modifying it from within. Second, research could not be part of pharma. It had to be discovery- driven, not financially-driven by marketing as most pharmaceutical companies were.”
Vasella agreed on both points, having Fishman report directly to him rather than Ebeling. This also led to internal criticism because the pharmaceutical group felt strongly it had to control its own research. “Separating research out,” Vasella said, “allowed me to protect the investment; otherwise, people start to cut it due to budgetary pressures.”
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