Photo : D.R.
A graduate of the Institut d’Études Politiques de Paris (IEP) and the École Nationale d’Administration (ENA), Dominique Amory was a diplomat and sub-prefect prior to getting his MBA from Harvard. He joined Lilly and 1992, and became President of Lilly France in 2005. He is also President of LIR, an association bringing together thirteen international research laboratories.
Commerce International: Could you briefly remind us who Eli Lilly was?
Dominique Amory: “Colonel Eli Lilly, founder of the eponymous group, was born in Maryland in 1839 to a family of Swedish origin. With a degree in chemistry and pharmacy, he opened his first pharmacy in 1860 in Indianapolis. His experience as an officer in the Union army during the Civil War, from 1862 to 1864, was a turning point in his career as a pharmacist. The care provided for soldiers made him realise that the effectiveness of medicine was of utmost importance, and that the era of potions sold by “miracle workers” criss-crossing the country in caravans was a thing of the past.”
Under what circumstances did he found his pharmaceutical company?
D.A.: “Following the Civil War, he returned to Indianapolis to found the group Eli Lilly & Company in 1876. He decided to apply his own method to provide quality drugs: the therapeutic effects of treatments were demonstrated and monitored with a veritable scientific approach, concrete observation and analysis of material evidence before being marketed. When he died in 1898, the company was offering more than 2000 products, and its turnover amounted to around 300,000 dollars.”
How did Eli Lilly & Company evolve to become the 10th-biggest pharmaceutical laboratory and the 5th-biggest biotechnologies company in the world?
D.A.: “The first big step was the discovery of insulin by Canadian researchers from a Toronto hospital, Frederick Banting and Charles Best, in 1923. Lilly was the first laboratory in the world to market insulin. The success was astounding: type 1 and 2 diabetes could now be treated with insulin, allowing diabetics to live longer and
better. In 1982, the first insulin of human origin was marketed, which was a great success as well.”
In what other domains does the Lilly group operate?
D.A.: “Following World War II, Lilly developed therapeutic treatments – some of which became major products – in extremely diverse domains: oncology (Gemzar, Alimta), the central nervous system (Prozac, Cymbalta, Zyprexa), Alzheimer’s disease, interventional cardiology (Reopro), Xigris and Efiente in the launching phase, osteoporosis (Evista and Forsteo), endocrinology (Humalog, Humalog Mix, Byetta and Umatrope), erectile dysfunction, and more.”
What is your strategy in R& D and your position on generic drugs?
D.A.: “Nearly 19% of Lilly’s turnover (3.841 billion dollars in 2008, or 2.55 billion euros) is spent on R&D, which is a considerable amount. We do not produce generic drugs, medical devices (pacemakers), dermatological products, or cosmetics. We only produce drugs derived from research. This is certainly a risky strategy, which definitely has the advantage of engendering elevated profit margins, but which also allows us to focus on our expertise – the discovery of innovative molecules – as the uncovered medical need remains extremely high. What’s more, it is important to know that by 2015, two-thirds of drugs worldwide will be generic. For Zyprexa, for example, this will be the case starting in 2011. We must continually find innovative new products that are capable of bringing an added value to the patient and the payer.”
Lilly recently announced staff cuts and internal reorganisations around the world. What is the situation?
D.A.: “The international financial crisis only marginally affected our activities, as we are not in debt. The crisis is not financial for us – it goes deeper than that: it is the crisis of an overall economic model. We must change from a blockbuster model with molecules treating large populations to a model of therapies targeting smaller populations of patients, known as ‘responders’. We are in a phase of difficult transition. Indeed, with the social budget deficit (health insurance, retirement pensions, etc.), there is an ongoing drive to make economies, which creates high pressure on the price of drugs. It is difficult to carry out research in a context of economic crisis, and the problem lies in reconciling economic imperatives with the pressing need to carry on with research.”
In this context of crisis, how is the Lilly group doing?
D.A.: “On a global scale, the turnover of the group Eli Lilly & Company rose to 20.4 billion dollars in 2008, or 13.5 billion euros (+9% compared to 2007). The group counts 40,450 associates in 143 countries, and has 21 production sites, including 6 in Europe: Alcobendas (Spain), Fegersheim (France), Kinsale (Ireland), Sesto (Italy), Speke (United Kingdom) and Giessen (Germany). Our staff includes 7,471 researchers (including 387 based in Europe) working in 9 different research centres, 2 of which are in Europe (Spain and Great Britain).”
What is the state of the French subsidiary, of which you are president?
D.A.: “Lilly France is the sixteenth-biggest pharmaceutical laboratory in the country, and counts 2,670 associates. Founded in 1967, it is the group’s fourth-biggest subsidiary, after the United States, Japan and Germany. Its turnover was 2.3 billion euros in 2008, including 1.6 billion euros from its production activities in the Fegersheim factory in the Bas-Rhin French department. This is the group’s largest production site: it counts 1800 employees, and has represented 700 million euros in investments over the past fifteen years. The factory produces insulin cartridges for the whole world (200 million units were sold this year). The headquarters of Lilly France are located in Suresnes, in the French department of Hauts-de-Seine, in the Paris region.”
What are Lilly’s objectives for the years to come?
D.A.: “We wanted to accelerate the arrival of new products on the market, at all cost. Currently, we have 64 molecules in development, in phases 1 to 3. As the pharmaceutical industry is undergoing this crisis, there will be more job cuts and mergers and acquisitions of laboratories. I think that companies that manage to emerge successfully will be those that find molecules providing an excellent quality/price ratio. In this context, Lilly can count on its ability to anticipate and listen to directors and employees. In order to ensure the long-term viability of the business and of jobs, we are remaining prudent in terms of recruitment. We have started up forums for exchange with our employees, and have a strong human resources policy to maintain an entrepreneurial spirit, favour risk-taking and responsibility. Our strategy has proved profitable, as Lilly France was named ‘Employer of the Year’ and ‘Sustainable Business’ by the jury of the 2009 European Business Awards.”
Further information at www.institutlilly.com; www.lilly.fr; www.lillymdr-tb.com; www.lillypro.com; www.mondiabete.net; www.oncorizon.com; www.schizosedire.com and www.vaincreladepression.com.
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