As expected, Genentech Inc. CEO Art Levinson and other executives, appearing at the annual J.P. Morgan Chase & Co. healthcare conference in San Francisco, were tight-lipped Tuesday about the pending Roche Holding AG $44 billion acquisition offer. In his presentation Levinson steered clear of the topic completely, and in a packed Q&A session afterwards, he and his assembled team declined to comment on the latest reports of Roche possibly preparing a new bid.
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That didn't stop Levinson, never at a loss for words or confidence, to mix a few zingers into his upbeat assessment of Genentech's science and finances. (His headlines: Tons of patents from its scientists, 26 drugs in clinical trials and optimism about final 2008 bottom and top line numbers due out Thursday.)
His first order of business was to rake conference staff over the coals for their brochure's cover art: an elegant model of DNA. One problem, though: It was backwards. "This does not exist in nature, except perhaps in a parallel universe," he said. At a conference highlighting an industry worth a third of a trillion dollars, "we should at least get the structure of DNA right."
He went on to mock other big drug companies for their plans to enter the generics field, something Merck & Co. announced recently. If he did that, he told the audience, it would be a red flag that said "Fire me" and an insult to Genentech's scientists. Later he threw another bone to the folks listening back at the company's South San Francisco, Calif., campus, saying he didn't understand how other big drug companies motivated their scientists when they limit freedom to publish their findings. Levinson claimed that Genentech, on the other hand, gives them the chance to do, "cutting edge science ... with the ability to talk about it on day one."
It's true Genentech has a great reputation for treating its employees and its top-notch scientists well, but there's added pressure now for Levinson to retain its best and brightest. After Roche announced its takeover proposal last July -- rejected as too low by Genentech -- Genentech put in place in August a $370 million retention program that let employees convert stock options to cash (check out
The Deal's Pipeline for more details).
When asked if the company had taken other steps to retain or motivate employees beyond that program, Levinson said, "Nothing dramatic." He called the August program a success.
Roche has consistently said it expects Genentech's research and early development departments to remain intact when the acquisition happens. -
Alex Lash
