3.5: Testimony from Jean-Jacques Bienaimé (CEO - BioMarin Pharmaceutical)

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From the course by ESCP Europe

Doing Business in Europe

25 ratings

ESCP Europe

Doing Business in Europe

25 ratings

Welcome to the MOOC “Doing Business in Europe”! Europe is a major world trade partner as well as a place where to acquire significant business experience. This is the reason why this MOOC has been designed with the view to explaining and guiding you in doing business in Europe. Do you really know Europe? How should you consider and approach the European continent? What business lessons can be drawn in a European perspective? With a dozen contributions from academics in the various domains of management (marketing, supply chain, finance, human resources management or strategy) and as many testimonials from business leaders operating in Europe, this course will help you enrich your knowledge and business competences within the European context. The MOOC is divided into 5 topics corresponding to 5 major issues when doing business in Europe: 1. Approaching the European market(s) 2. Innovating in Europe 3. Investing in Europe 4. Building the value chain 5. Integrating the diversity There are no prerequisite for this course. At the end of the coursework, participants will be able to understand how to design a European-scale development strategy. Please enroll and thank you in advance for choosing this course!

From the lesson

Unit 3: Investing in Europe

Where and how to invest in Europe? This unit “Investing in Europe” deals with location and entry mode choices in the European context. You will be trained to ask the right questions to choose the right location in Europe. You will discover that Europe is the largest market for franchising with a great potential for development, an opportunity to rapidly develop corporate positions in various European markets. And you will get insights on how to complete successfully a company acquisition process in Europe.

3.5: Testimony from Jean-Jacques Bienaimé (CEO - BioMarin Pharmaceutical)7:14

Meet the Instructors

Prof. Dr. Florence Pinot de Villechenon
Associate Professor
Economics, Law and Social Sciences
Prof. Dr. Béatrice Collin
Associate Professor
Strategy, Organizational Behavior and Human Resources

Hi my name is Jean-Jacques Bienaimé I am the Chairman and Chief Executive

Officer of BioMarine. BioMarine is a 20 year old biopharmaceutical company.

Its the anticipated revenues this year in 2017 are around 1.3 billion dollars.

We operating in over 50 countries in the world I joined the company around 12

years ago and the company more specifically is focused on developing

and manufacturing and commercializing drugs for rare genetic disorders.

Disorders sometimes are so rare that in most European countries for the specific

diseases we treat, you are going to find around 50 patients.

The company has been very successful, very innovative. We've been ranked for three years in a row

by Forbes magazine in the top 10 most innovative companies in the world

all industries combined, so we were pretty proud of that.

So let me talk a little bit about the international expansion of Biomarin.

When I joined the company 12 years ago, there were no BioMarin employees outside the U.S.

We had only one product that was marketed by our partner

Genzyme which now belongs to Sanofi and the product was Aldurazyme

for again a rare genetic disorders. We were about to receive approval for our second

product Naglazyme and there were, when I joined the company, advanced

discussions again with Genzyme to potentially have Genzyme commercialized

Naglazyme, outside the US. And, there were some negotiation going on and then, when

I looked at the terms of the deal, I realized that it probably would not be

the best way to maximize shareholder value and I decided to terminate the

negotiations and to keep my rights for Naglazyme which I believe it was

a fundamental decision that allows us to still be an independent company today.

Obviously, it was a pretty bold decision

in the sense that as I said earlier, we had no Biomarin employees outside the US,

so we had to build an infrastructure in Europe and then in the rest of the world

from scratch. So the way we started, I hired seasoned executive in Europe.

I just started with a couple of employees. They were working in an

internet cafe because we had no offices to have access to the internet and

communicate with each other. Eventually, we found a small office and we started

selling Naglazyme, but around the time it was approved in Europe and

before we had final reimbursement pricing negotiations on it was

called the name patient basis so you can sell the product to different

countries like Germany, France, Spain, specifically. Although the plug is not

yet officially approved and start to get some revenues. Eventually, we

ended up hiring some country managers one in each European country to slowly

start building the commercial business and then also we realized that.

Besides the big EU five Germany, France, UK, Spain, and Italy there

were some patients also in Turkey and Turkey is not officially part of

Europe but they want to join the EU and because of the genetics of the disorder,

Turkey is a very large market for us and we ended up doing a lot of business there.

I think it was a fundamental decision, critical decision for the

long-term value of Biomarin and because today 85 % of our revenues

and 85 % of our patients are actually outside the United States.

So, this decision basically exceeded our expectations and led to a major road in

the valuation of the company. When I joined the company 12 years ago the

company was worth about 300 million dollars and, as I think I said earlier, it

is now worth of 16 billion dollars. So our expanding

outside the US was a mainly initially a commercial decision but we also made a

decision in terms of manufacturing. Manufacturing is a very large component

of Biomarin's organization and we had two manufacturing facilities in the U.S.

in California but with the launch of our fourth product Vimizim we needed more

capacity for manufacturing and we decided to go to Ireland and we acquired

a manufacturing facility in Shanbally and in Cork from Pfizer Pharmaceuticals that

facility was basically brand new and never been used by Pfizer and we were

able to acquire it for about 25 % of the cost he would

have taken us to build a facility from scratch. So it was a good acquisition

in terms of pricing and also we could save a lot of time as compared to

building a facility from scratch. Other reasons why we decided to go to Ireland

for this facility was the availability of a highly skilled sales force, a very

favorable business environment. The English language was obviously

helpful for our people here in California to be able to communicate

with those people. So, it was a very good decision in this respect so we

now have a pretty substantial presence in Ireland. We have about 400 people

there between manufacturing and actually we have move our European

and Middle East and Africa commercial operations in Dublin and

we might expand further. We have some offices in London depending on what

happens to the European medical agency following the Brexit decision from the UK.

We might expand further into Dublin from London because, as you probably know,

Ireland is still part of the European Union.

Another key variable in our decision to also acquire this facility in Ireland

was the availability of a very skilled workforce.

So as you can tell Europe is a critical, actually fundamental part of our business and

we have now build a very significant infrastructure over there.

Actually, we are looking into potentially leveraging this organization, specifically the

commercial and medical affairs organization to potentially partner with

other biopharmaceutical company of smaller size, that need a European partner

for drugs that they have been developing for rare genetic disorders.

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