Novartis leaves NC incentive as it lowers hiring target at Durham manufacturing site
Swiss pharmaceutical giant Novartis has exited one of its two state incentive deals for a gene therapies facility near Research Triangle Park. The North Carolina Economic Investment Committee on Tuesday canceled the company’s 2019 job development investment grant, which promised to create 200 jobs, upon Novartis’ request.
“Although Novartis will remain fully operational at the project location, the company does not expect enough growth to meet the headcount commitments for phase II (of the project),” Novartis Gene Therapies secretary Jaime Huertas wrote in a March 6 letter to the North Carolina Department of Commerce.
In May 2018, North Carolina awarded the Novartis gene therapy division (then called AveXis, later renamed Novartis Gene Therapies) an initial job development investment grant to build a new manufacturing center in south Durham. Through this first JDIG, which remains active, Novartis has created 198 jobs and invested $55 million at the 170,000-square-foot site off East Cornwallis Road.
Then in February 2019, North Carolina awarded Novartis a second incentive to hire another 200 workers and invest an additional $60 million at the Durham location. The company said the facility started this year with 308 employees and has achieved its investment commitments under both grants. Most JDIG recipients have not met their original hiring targets since North Carolina began the incentive program in 2003.
Novartis’ Durham facility produces Zolgensma, which treats spinal muscular atrophy, an inherited fatal disorder often referred to as SMA. In 2019, the Food and Drug Administration approved Zolgensma for children under the age of 2.
A few months later, the FDA announced Novartis had hidden manipulated data from the federal agency, though the government said the treatment was still safe. Novartis’ efforts to have Zolgensma approved for use in older patients were then slowed for years by clinical delays. In December, the shared a favorable study that suggests the treatment could be given to older patients.
According to the industry news outlet Fierce Pharma, the company intends to file its Zolgensma data with regulators in the first half of this year.
The FDA defines gene therapy as “a technique that modifies a person’s genes to treat or cure disease.” In recent decades, the Triangle has developed into a hub for gene therapy treatments, through research at Duke University and UNC-Chapel Hill’s Gene Therapy Center as well as in the local presence of companies like AskBio, Tune Therapeutics and Biogen.
As of Wednesday, Novartis was the 55th largest public company in the world with a market value above $200 billion.
