With ambitious research and development growth and a need to hire experienced workers, Allergan Inc. thought it would be an easy sell to convince New Jersey pharmaceutical veterans to relocate for jobs in sunny southern California.
But the task proved quite difficult, said Scott D. Sherman, executive vice president for human resources at the Irvine, Calif.-based firm. He said fears about the housing and labor markets made workers skittish about moving across the country. So Allergan tried a different approach.
"Instead of working hard to move people from New Jersey to California, which is expensive and difficult, we're taking jobs that we're growing … and we're bringing the labor demand to the labor supply," Sherman said.
On Tuesday, Allergan cut the ribbon on its new 93,000-square-foot research and development center at the Somerset Corporate Center, in Bridgewater. The new space will replace a small, four-year-old R&D center in Bedminster, which is home to about 40 workers. Those workers will relocate next month as the company shifts operations and begins a major recruitment effort to hire hundreds of R&D workers in the coming years. The New Jersey Economic Development Authority has awarded the firm a Business Employment Incentive Program grant that would pay up to $14.9 million over 10 years and create as many as 387 jobs.
Allergan is perhaps best known for Botox, which is used for cosmetic purposes to clear up frown lines, but has other therapeutic uses. The company was founded with a focus on ophthalmology, but its pipeline now includes products from several therapeutic areas.
The new jobs represent growth for the company, and a commitment to aggressively ramp up research and development. The firm plans to spend more than $1 billion on R&D next year, up from about $900 million this year.
David E. I. Pyott, Allergan's chairman, president and CEO, said that puts Allergan at odds with the trend among many big pharma firms to rein in R&D spending. Many of those companies have operations in New Jersey, something that made the state attractive to Allergan.
"When you see stagnation in other organizations, where I sit, of course, that means opportunity, because naturally people want to get ahead with new professional challenges, and we hope some of them will choose to take a chance with getting ahead with us," he said.
Sherman said the company initially will target experienced workers with clinical research and development and biostatistics backgrounds.
Pyott said New Jersey had an initial leg up on the competition because the company already had a presence in the Garden State. He said Allergan also looked at North Carolina and Pennsylvania, which have better reputations than New Jersey when it comes to business climate, but Pyott said for these positions, the salary differential between those states and New Jersey was pretty small.
"And after California, anything's cheaper," he said.
Pyott said the Somerset Corporate Center specifically was chosen in part because it's right off Route 22 and near other major highways, including I-287. He said the accessibility of the site will help retain Bedminster employees and make it easier for others to commute.
Tracye McDaniel, CEO of the nonprofit business recruitment agency Choose New Jersey, said state officials were able to present a successful case by coupling natural advantages like the state's geographic location and pharmaceutical history with incentives like the BEIP grant. She said the Allergan victory helps give the state economic development momentum.
"It's one of those signals nationally to CEOs and site consultants who are looking to locate businesses that things are happening in New Jersey," she said.
The event represented a major success amid a topsy-turvy economic development climate that includes wins like expansions at Allergan, Bayer HealthCare and Novo Nordisk, as well as significant losses, such as Roche's plan to close its Nutley site and cut 1,000 jobs.
Lt. Gov. Kim Guadagno told the crowd gathered Tuesday in Bridgewater that the state won't give up without a fight.
"You know you're not going to win every fight, but I think it is fair to say that in this administration, you will have a fight," she said. "If you want to come to New Jersey, we will fight to bring you here."