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Lilly competitor Novo investing $100M in China

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Novo Nordisk A/S, the world’s largest insulin maker, plans to spend $100 million on research in China, part of an effort to understand why Asians may develop diabetes younger and at lower bodyweights.

The move into China follows a similar one by Indianapolis-based Eli Lilly and Co., which in May opened a research center in Shanghai, employing 150 scientists and staff to focus on discovering medicines that can be tailored specifically for the Chinese population.

Novo has allocated $40 million for building a research facility in Beijing and $60 million on hiring staff and funding studies, said Mads Krogsgaard Thomsen, the Danish company’s chief scientific office. He said he wants 200 scientists in China by 2015, from 130 now, mostly for diabetes.

China, with about 100 million diabetes sufferers, has become the Bagsvaerd, Denmark-based company’s largest market after the United States. A tendency to distribute fat around the liver, pancreas and other visceral organs may cause faster diabetes-inducing metabolic changes among Asians than in Caucasian populations, Thomsen said.

“We see China as the first place in the world outside Denmark where we are building more of the research value chain to tap into the science and to establish a unique insight into Chinese diabetes and its problems and differences,” he said.

Western drugmakers are promoting existing products and searching for new diabetes medicines in China as the market is poised to triple to $2.1 billion in annual sales by 2019 from $700 million in 2009, according to Datamonitor in Shanghai.

In addition, Paris-based Sanofi is helping China train 500 diabetes specialists and 10,000 community and rural-based doctors to treat the illness.

Novo, which has more than half of China’s insulin market, is trying to understand the nature of the differences in disease patterns and identify ways the hormone can be given to optimize blood-sugar control, he said. Some studies will be done in mice and dogs in the Beijing center, the company’s first animal pharmacology research lab outside Denmark.

“It’s a long way from Beijing to Copenhagen,” Thomsen said. “It’s a big advantage for our Chinese scientists if they are able to also do their animal experiments because we save time.”

Research on immunology and the blood-clotting disorder hemophilia will also be done in Beijing, he said. The company isn’t expanding research in China at the expense of research at sites elsewhere, he said. Novo, which has about 5,000 people in R&D, is increasing its research budget about 10 percent annually, tracking double-digit growth in sales, Thomsen said.

Novo’s research and development expenses totaled $1.67 billion in 2011, of which two-thirds was spent on diabetes care and the remainder on biopharmaceuticals, according to data compiled by Bloomberg.

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  • Jobs, jobs, jobs
    I feel a lot better knowing my insulin is being created overseas and outside the pesky oversight of the FDA. And especially that low-skilled, low-wage Americans won't have any part in it. #sarcasm

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