Drugs giant backs NZ expertise

By SIMON COLLINS

One of the world's biggest medicine manufacturers, Pharmacia, has sunk US$2 million ($4.6 million) into a new Auckland firm that will seek cures for diabetes and giantism, or excessive growth in children.

Science Minister Pete Hodgson hailed the move yesterday as a sign to other pharmaceutical firms that New Zealand science was first-rate.

"It signals that if Pharmacia has taken the plunge, they may be missing out on something."



The US Pharmaceutical Manufacturers Association has lobbied the US Government against a free-trade deal with New Zealand, in protest against hard bargaining over medicine prices by the Government's drug-buying agency, Pharmac.

The new company, Endocrinz, will create 30 to 40 jobs for scientists and technicians at Auckland University's Liggins Institute, which already employs about 80 medical researchers and will do all Endocrinz's research on contract.

Endocrinz's initial chief executive is Jerry Balter, a New York venture capitalist who also manages the New Zealand Seed Fund.

The fund was set up by the university's Auckland Uniservices but is now owned by private investors including Stephen Tindall and the Todd family.

The Seed Fund, Pharmacia and Dr Robin Congreve's Oceania and Eastern Group will each own about 30 per cent of Endocrinz initially.

The rest will be reserved for staff and consultants.

The university will also have an option to buy a 20 per cent stake.

Congreve will chair the company. The other directors are Balter, Pharmacia Discovery vice-president Rodney Lappe from the US and Trevor Scott, a director of the Seed Fund and chairman of Otago University's commercial vehicle, Otago Innovation.

The Seed Fund and Oceania are also major shareholders in Neuronz, which is also based at the Liggins Institute.

The institute's director, Dr Peter Gluckman, said Endocrinz would do "pre-commercial" research for Pharmacia, and Neuronz would focus on developing drugs for commercial use.

Pharmacia NZ president Terrie Curran also said the collaboration sent a message to other companies that New Zealand was a good place to invest.

"The potential for New Zealand to become a research and development centre for pharmaceutical companies is huge. Pharmacia spends US$2 billion [$4.6 billion] a year on R&D. New Zealand has a reputation for high-quality research."

New Jersey-based Pharmacia, the world's seventh-biggest pharmaceutical company, will have first right to buy all intellectual property developed by Endocrinz.

Its investment follows a similar decision by London firm GlaxoSmithKline last December to invest "several million dollars" in a new respiratory diseases research institute founded in Wellington by a former professor in the Wellington Medical School, Dr Richard Beasley.