Roche Has Upper Hand in Battle for Genentech R&D Talent

Everyone thinks that the Roche-Genentech merger will destroy Genentech’s “culture,” either because the stuffy suits from Roche will crimp the grass-skirt-and-coconut-bra vibe at Genentech or because Genentech scientists will look at all the money they just made on their stock and leave. If that happens, all their knowledge — and thus the value of the company — will leave with them, the theory says.

But there’s a good reason to think that the deal leaves Roche well-placed to maintain Genentech as an R&D powerhouse: the recession.

The WSJ and Forbes have taken the line that dozens of scientists at Genentech are already packing their cardboard boxes. WSJ:

In the Roche deal, one big issue will be retaining top scientists, many of whom will be made rich by it. The Bay Area is rife with speculation that top scientists will depart.

Forbes:

“Many [at] Genentech don’t like Roche,” says Avik S. A. Roy, managing partner at Mymensingh Partners, a New York hedge fund. He thinks once the job market in drug research improves, Genentech scientists will head for the doors. “Long term, over two to four years, they will lose most of the best people.”

In the Pipeline’s Derek Lowe seems a bit more willing to give Roche a chance:

The main encouraging thing I can take out of it is that Roche is saying that they want to keep Genentech’s R&D operation separate, and to keep their talent and their approach to discovery. It’s nice to at least hear lip service to that idea — it’s a start — but now we’ll have to see if they follow through.

Roche has one big advantage in this deal: The many thousands of R&D staff laid off by other companies around the world.

Yes, some key people from Genentech will likely choose the beach over the fume cupboard, but never before has there been such a wealth of laid-off talent to choose from on the market, all desperate to work at a company known for its high-quality R&D.

The Genentech “culture” may indeed walk out along with many longtime employees. But unless Roche is determined to screw this up, it should remain a magnet for talent, newly cheap and readily available.

• BNET’s Previous Roche-Genentech Coverage:
• Roche-Genentech Takeover Will Cost 1,500 Jobs in N.J.; Roche Name to Go
• Genentech’s Levinson May Have No Change-of-Control Agreement in Roche Deal
• New Roche Offer and Genentech Squeeze-Out Ploy Put Focus on April’s Avastin Results
• Roche-Genentech: $16 Billion Raised, Raptiva Off the Market, Stock Market Doesn’t Care
• Roche-Genentech: Lack of Deal Is All Goldman Sachs’ Fault
• Roche Goes Hostile in Genentech Bid; Still Has No Financing Lined Up
• Roche Begging for $45 Billion It Doesn’t Have
  
• Roche-Genentech Deal: $95 Bid Coming by February
• Could Roche-Genentech Deal Price Actually Be Getting Lower?
• Roche Doesn’t Have Enough Money for Genentech Deal
• Roche Genentech Deal Conspicuous By Its Absence
• A Worst-Case Scenario in the Roche-Genentech Deal