|Chief executive Henri Termeer voiced optimism on the future. (Donald Rockhead for The Globe)|
Genzyme chief expects to increase Mass. workforce by at least 500
Genzyme Corp., which is working to end rationing of two key drugs and return to full-scale production by midyear at its troubled Allston Landing plant, expects to hire more than 500 workers in Massachusetts this year, mostly at its headquarters in Cambridge and at manufacturing sites in Framingham and Allston.
The biotechnology company’s plans were disclosed by chief executive Henri Termeer during a visit to the Globe yesterday. Termeer said the company added 330 employees in the state last year and 1,000 globally, boosting its workforce to about 12,000, including 4,500 in Massachusetts. The number of employees could double over the next five years, as Genzyme brings new drugs into the marketplace, he said.
Termeer, in a wide-ranging discussion, also said he is not deterred by a pair of activist investors who have been buying Genzyme stock, expressed his disappointment in the blow dealt to the health care overhaul by this week’s Senate election in Massachusetts, and said he is determined to put Genzyme’s production problems behind him.
“We are at the beginning of the turnaround, and it looks pretty encouraging,’’ Termeer said, citing progress made in Allston.
While the company had three drugs approved in 2009, the year was dominated by its struggle to correct production defects cited by federal regulators and clean up after a virus was found in a bioreactor at the Allston plant. The virus forced Genzyme to suspend manufacturing temporarily and ration two costly enzyme replacement drugs that treat rare genetic disorders: Cerezyme for Gaucher disease, which causes swelling of the liver, spleen, and other organs; and Fabrazyme for Fabry disease, which causes the build-up of fat in eyes and kidneys.
Genzyme resumed full delivery of Cerezyme in December and expects to supply 80 to 100 percent of required doses for Fabrazyme patients by the end of the second quarter, Termeer said.
Much of the hiring in Massachusetts last year and this year will be to staff a new plant in Framingham built to increase the company’s capacity to make Cerezyme and Fabrazyme so it will not be caught short in the event of another emergency. Framingham received a $12.9 million state grant to make infrastructure improvements, adding water and sewer lines, to accommodate the Genzyme plant and other operations under Governor Deval Patrick’s $1 billion initiative to promote life sciences.
At a separate Framingham plant, Genzyme is producing the drug Myozyme to treat children younger than 18 who suffer from Pompe disease, a rare genetic disorder that interferes with muscle development and causes severe respiratory problems.
Genzyme said yesterday that the Food and Drug Administration has set June 17 as its decision date on the company’s application, filed late last year, to make a variant of that drug, called Lumizyme, on a larger scale for adult Pompe disease patients. That drug is the most important of several in the company’s pipeline that could expand its revenue and employment base in the first half of the new decade, though production of Lumizyme will take place in Belgium.
“Lumizyme looks poised for a mid-2010 approval,’’ Christopher J. Raymond, senior biotechnology analyst for Chicago financial firm Robert W. Baird & Co., wrote in a note to investors yesterday. But he cautioned that Genzyme faces intense competition from rivals to Cerezyme, its top-selling product, despite a 10 percent increase in its share price since the start of the year. Shares closed down 42 cents, or 0.7 percent, yesterday to $54.43 on the Nasdaq exchange.
Termeer said he was confident two shareholder activists, Ralph Whitworth of California and Carl C. Icahn of New York, have been accumulating Genzyme shares because they see it as a good investment, not because they have designs on the company.
He acknowledged he has not met with Icahn, a billionaire investor who has taken a 1 percent stake in Genzyme. The company has promised to offer Whitworth, cofounder of San Diego asset management firm Relational Investors LLC, which has amassed a 4 percent stake, a seat on Genzyme’s board next fall as part of a mutual cooperation pact.
“Ralph is interested in a return for his investment capital,’’ Termeer said. “Carl is in it for the investment. Our stock has been trading down. He made an investment, like a lot of other people. He will get a good return on it. . . . His most important thing is not to create real disruption; it’s to create a real return. And if he studies it, he will find the best way to create real return is to let us recover.’’
Termeer also said that he supports an overhaul of the federal health care system and was disheartened that movement on a comprehensive national health care bill appears to have been derailed by Republican Scott Brown’s election to the Senate.
But he suggested a provision important to the biotech industry, granting 12-year data exclusivity for drugs before generic versions are allowed on the market, still could be approved in a separate bill.
Robert Weisman can be reached at firstname.lastname@example.org