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Chemical Conversions

Executive Summary

Interviews with the heads of R&D at a mid-sized drug firm (Ulrich Grau, BSAF Pharma) and a very large one (Wolfgang Hartwig, Bayer AG), both based in Germany, in which they discuss how their companies' research strategies are evolving in response to industry consolidation. Some Industry observers argue that pharmaceutical M&A has created entities of such massive scale that mid-sized organizations will soon be unable to compete. But Ulrich Grau argues that huge size is not an advantage in R&D because scientists tend to do their best work in small groups. He adds that BASF intends to leverage the flexibility its size enables to become more responsive to in-house research findings and to biotech partners it will seek out for the first time. Bayer thinks it can be more flexible than the industry's giants. To balance its chemical bent, Bayer has recently spent large sums to ally with partners whose technologies support work in 15 research areas.

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