Clinical Trial and Joint Venture

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GENZYME/GELTEX PHARMACEUTICALS JOINT VENTURE In early 1997, Greg Phelps, EVP of Genzyme Corporation, met with members of a joint- venture negotiating team to develop proposed terms of a joint-venture agreement. The venture would combine capabilities of Genzyme and GelTex Pharmaceuticals to market GelTex’s first product, RenaGel. GelTex was an early-stage biotech research company with two products in its pipeline. GelTex had neither the capital nor the marketing organization to launch RenaGel. Therefore, the company had been looking for a partner that would contribute cash and marketing expertise in exchange for a share of profits in a joint venture. Genzyme had revenues of $518 million in 1996, and had grown rapidly…show more content…
The drug was approved for sale in the United States in March 1991 to treat patients suffering moderate to severe symptoms of Gaucher’s disease, a market of some 3,000 people. Two years later, the company launched a recombinant form of Ceredase and started to enter new markets—surgical, pharmaceutical, diagnostic, and genomic products—through strategic alliances, joint ventures, and acquisitions. Such diversity allowed Genzyme to play a leadership role in a broad range of cutting-edge technologies and therapies, according to Genzyme’s chair, president, and CEO, Henri A. Termeer.2 The company’s diversity came from its threea divisions—Genzyme General; Genzyme Tissue Repair; and a subsidiary, Genzyme Transgenics—each with its own common stock traded on the NASDAQ (Exhibit 1). The wide array of technologies provided Genzyme with an excellent platform for achieving breakthroughs in major unmet medical needs. Rather than concentrate efforts on the next big hit, however, the company had decided to manage its R&D like a portfolio by outsourcing innovations through partnerships. Genzyme’s strategy was to supplement its internal R&D with strategic alliances with external

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