Skip to main content
Premium Trial:

Request an Annual Quote

Merger Would Combine World s Largest Bioinformatics Depts.

Premium

NEW YORK--If merger discussions presently taking place between SmithKline Beecham and Glaxo Wellcome are successful, the deal would not only be the world's largest corporate merger, it would also unite the two largest corporate bioinformatics departments. In a statement January 30, SmithKline Beecham claimed the proposed merger--valued at $65 billion-$70 billion--would result in the formation of the largest R&D organization in the global healthcare industry. The merged firms' R&D budget would exceed $3.3 billion.

Bioinformatics directors David Searls at SmithKline and Dominic Clark at Glaxo declined to comment to BioInform, but opinions among other industry observers varied as to the consequences the deal would have on the landscape of gene-based drug discovery and on the two companies' internal bioinformatics operations.

SmithKline's bioinformatics staff numbers near 70, with project teams working in Upper Merion, Pa.; Upper Providence, Pa.; and Harlowe, UK. Glaxo's 50 or so bioinformatics staff work out of offices in Research Triangle Park, NC; Geneva, Switzerland; and Stevenage, UK.

If the merger goes through, some analysts have estimated staff reductions in the order of several thousand. Some observers doubt science or bioinformatics staff would be affected, but others question the value of a bioinformatics staff 120 strong.

Rainer Fuchs, who recently vacated his post as Glaxo's bioinformatics director, predicted that overlap between the two companies' bioinformatics staffs will result in some layoffs. "There's a certain economy of scale. At one point you don't get a return by adding people," he said. "In some cases, both operations are looking at the same targets. There's not a lot of sense in keeping those scientists around."

How successfully the two bioinformatics departments could merge is another question. Fuchs said a merger would not be particularly beneficial to either company's bioinformatics effort. "There is nothing either bioinformatics department had to gain from the merger. Both companies have their own strategy. I don't see a lot of commonality or that anyone thought there was anything missing."

He added that a number of significant scientific differences between the two firms' bioinformatics practices might present obstacles to a smooth transition.

"The SmithKline program has a stronger emphasis on traditional sequence analysis triggered by the need to analyze the huge Human Genome Sciences data set," Fuchs said. "Glaxo Wellcome only recently gained access to Incyte, so the Glaxo program is more tailored to in-house gene discovery using positional cloning."

Fuchs said he staffed the department he headed at Glaxo mostly with statistical geneticists. Searls told BioInform in an interview last year that he has hired a multidisciplinary staff to manage bioinformatics at SmithKline.

Fuchs also foresaw the two companies' organizational structures complicating any merger that might take place between the two bioinformatics departments. "Glaxo is without central leadership while David Searls runs a centralized bioinformatics effort at SmithKline. How do you merge those two environments?" Fuchs wondered.

Wading through the logistics of a merger might also slow down progress in the two departments, Fuchs predicted. "During a merger you spend a lot of time just on inventories. When Glaxo and Wellcome merged, Wellcome didn't have a bioinformatics department and I still found myself caught up for six months looking at silly accounting-type work," he recalled.

Still, Fuchs said, the two programs have similar enough cultures and scientific approaches to make a merger work. "They both have systems in place to manage automated sequence analysis and to maintain copies of external databases in-house," he observed.

Genomics' Changing Landscape

If a merger happens, observers predict it will instigate a major change in the gene-based drug discovery landscape. Other companies will be under pressure to find partners, several sources said. But it will be difficult for others to duplicate the number of significant activities and the many areas that a combined SmithKline and Glaxo would cover.

As for competing with a 100-plus bioinformatics staff, it's unlikely that many other pharmaceuticals would try, observers noted. "Bioinformatics is an unproved resource. It's a leap of faith to assume it will pay off eventually. Not many will be willing to increase their in-house bioinformatics staff to compete," one source told BioInform.

Fuchs said he doesn't expect a combined SmithKline-Glaxo bioinformatics effort to be a major threat to other pharmaceuticals. "No one should expect the research efforts of the new company to be the sum of the two as they exist now," he warned.

--Adrienne J. Burke

Filed under

The Scan

For Better Odds

Bloomberg reports that a child has been born following polygenic risk score screening as an embryo.

Booster Decision Expected

The New York Times reports the US Food and Drug Administration is expected to authorize a booster dose of the Pfizer-BioNTech SARS-CoV-2 vaccine this week for individuals over 65 or at high risk.

Snipping HIV Out

The Philadelphia Inquirer reports Temple University researchers are to test a gene-editing approach for treating HIV.

PLOS Papers on Cancer Risk Scores, Typhoid Fever in Colombia, Streptococcus Protection

In PLOS this week: application of cancer polygenic risk scores across ancestries, genetic diversity of typhoid fever-causing Salmonella, and more.