The French drug company Servier is doubling down on its presence in Boston with a new research lab and an expanded US headquarters in the Seaport District. The expansion is part of the company’s plans to become an oncology powerhouse in Boston and grow its business in the United States.
Until four years ago, the company barely had a foothold in the city. That changed with the acquisition of cancer drug franchises from two companies with Massachusetts ties: a $2.4 billion deal for Shire Pharmaceuticals’ cancer business in 2018 and a $1.8 billion acquisition of Agios Pharmaceuticals’ cancer business in 2021. Now, more deals could be on the way.
“We’re not going to stop at the Agios deal, especially when there’s good science out there,” David K. Lee, the chief executive of Servier Pharmaceuticals, the company’s US subsidiary, told the Globe. “We’re definitely open for business.”
When the firm opened its US headquarters in Boston in 2019, it had about 100 employees across the country and expected to double its workforce in five years. Servier has nearly quadrupled to 385 employees in the United States, with roughly 170 between its lab and office in Boston.
“We’ve grown fast. Much faster than we expected,” Lee said.
About 150 employees occupy Servier’s office on the sixth floor of 200 Pier Four Boulevard, overlooking Boston Harbor and the Seaport World Trade Center. Another 20 people work down the street in Servier’s new $10 million lab at 51 Sleeper St., facing the Fort Point Channel. The firm expects to soon double its staff in that 20,000-square-foot space.
Servier is still a long way from being one of the top 20 biopharma employers in Massachusetts. The firm’s operations in the United States are a small fraction — less than 2 percent — of the approximately 21,800 people the company employs worldwide. And the $289 million that Servier made selling its drugs in the United States last year only accounted for 5.4 percent of its $5.35 billion in global revenue.
But Boston is the company’s beachhead for growing its global cancer business. The world-class hospitals, academic research centers, and more than 1,000 local biotech companies continue to make the city hard to beat, Lee said. “You don’t see that richness anywhere else in the world,” he added.
And with several other major pharma firms setting up shop in Boston this year, Servier is not alone in its ambitions.
Last month the German giant Bayer opened labs and offices in Cambridge’s Kendall Square to do cancer research and foster partnerships with academic labs and biotech companies. British drugmaker AstraZeneca said in April that it would build a major research center, also focused on cancer and based in Kendall Square. And in February, Indianapolis-based Eli Lilly & Co. announced plans for a genetic medicine research center in the Seaport.
These firms all believe that being in Boston is crucial for forming collaborations with hospitals and universities, and for having a front-row view of up-and-coming biotech startups that they rely on for many of their new drugs.
“We continue to be on the lookout for deals and other opportunities here,” said Pedro Crisanto, Servier’s chief operating officer.
Many public biotech companies have seen their stocks decline precipitously over the past year and a half, some as much as 90 percent or more, leaving many strapped for cash. Before the current biotech stock slump, it was getting difficult for pharma firms to justify the increasingly high prices they had to pay for acquiring smaller firms, Lee said. “I think valuations are in a much more reasonable place now, so our interest in getting deals done has increased.”
Servier has traditionally focused on cardiovascular disease drugs, but is doing research on drugs for cancer, autoimmune diseases, and neurodegenerative diseases. Cancer, which has recently become a major focus for the company, consumes more than half of the firm’s research budget.
Servier made $684 million globally on its cancer drugs last year, an increase of 35 percent from the year prior, largely due to sales of its leukemia drug Tibsovo, which it acquired from Agios, and its pancreatic cancer drug Onivyde, which it acquired from Shire. Lee’s goal is to more than triple US sales to $1 billion in the coming years.
The firm has 21 programs in the pipeline, and Lee anticipates five FDA approvals — either new drugs or new uses of their existing drugs — over the next five years. Servier reinvests about a quarter of its profits back into research, and scientists at its new research labs are conducting early-stage experiments that may lead to new ideas for treating cancer.
Chief operating officer Crisanto said that because Servier is a nonprofit pharma firm, the company can focus on a long-term vision over short-term gains. “That really allows us to invest in hard-to-treat cancers,” he said. “We don’t have that shareholder pressure to change our strategy every quarter.”
“It’s really liberating work because it opens up new opportunities and new targets that I normally wouldn’t have been able to work on,” said Dale Porter, head of oncology and immune-oncology research. He wouldn’t say what any of those targets are, because the lab is focused on early-stage drug discovery programs that Servier hasn’t publicly disclosed yet.
Lee said that Servier considered building its US headquarters in Kendall Square, as well as cheaper locations in Burlington, Waltham, and Watertown, which are becoming destinations for biotech companies looking to get away from the sky-high prices and congestion in Cambridge. But Lee said Servier ultimately wanted to be in an area that “captured the spirit of innovation.”
It chose the Seaport, an increasingly popular, although still expensive, alternative to Kendall Square, with neighbors including Amazon, the consulting group PwC, and Vertex Pharmaceuticals.
“We liked the diversity of different industries here,” Lee said. “We love it here in Boston. I think we are absolutely in the right place.”
Ryan Cross can be reached at ryan.cross@globe.com. Follow him on Twitter @RLCscienceboss.