Research and Development - Key Factors in Lek's Strategy

Lek's new Research Center in Slovenia - Progressing toward Greater Innovation

6. 5. 2002

Ljubljana, May 6, 2002 – Today, with the president of the Republic of Slovenia, Milan Kučan, and prominent representatives of the Slovenian scientific and business communities in attendance, the Slovenian pharmaceutical company Lek, officially opened its new Research Center (RC) on Verovškova street in Ljubljana. With an investment of SIT 2.9 billion, Lek advances its strategy of becoming a more innovative company. The new Research Center presents opportunities that encourage the in house development of high quality and accessible drugs to meet the latest treatment protocols. The new RC will promote increased and closer collaboration with Lek’s research units and those of research institutes and faculties at home and abroad.

In his congratulatory note to the president of Lek’s management, Janez Drnovšek, the Prime Minister of the Republic of Slovenia, wrote: “In the Slovenian business community, Lek has for many years embodied the concept of a company that successfully overcomes all challenges, at home or abroad; a company whose eyes are clearly focused on the future. Lek’s success is due in large measure to the efficiency and rapid response of its R&D activities, which are often the result of collaborative efforts of its researchers with researchers from different faculties and research institutes at home and abroad. Let me congratulate you on the completion of this important project and wish you all the best in meeting future challenges that will only succeed in confirming your position in the demanding business world.”

The international pharmaceutical company Lek, which in terms of the volume of sales ranks 112th (Scrip’s 2001 Pharmaceutical Company League Tables) has come a long way since its inception in 1946. Much of the credit for Lek’s high degree of internationalization is due to its support and historical orientation to research and development.

The capacity and organizational needs of Lek’s R&D units were at the core of the merger of the drug design laboratories at the new Research Center on Verovškova Street in Ljubljana. The new, up-to date facility measures 8711 m2, houses 70 laboratories, and meets the most demanding international standards of both Good Laboratory Practice (GLP) and Good Clinical Practice (GCP). The new RC is supplied with the latest equipment available for pharmaceutical and technological research and development, for controlling different manufacturing parameters, for biopharmaceutical research, and for testing the stability of drugs and their physical-chemical properties. It is outfitted with the latest systems for the analytical support of R&D, equipment for bio-analysis, and other equipment that sets the standard for growth and that verifies the quality, safety and efficiency of drugs. The new center also houses the Regulatory Affairs, which is responsible for registrations and for securing the marketing rights to sell drugs in numerous Lek’s markets. The cost of the new facilities and related equipment was SIT 2.9 billion, and including the cost of lab equipment, SIT 4.5 billion.

The construction of the new Research Center put into action Lek’s strategy of transforming the company with an eye to greater innovation. Roughly 12 percent of the value of sales is allocated to R&D, which is committed to the in house development of accessible, and high quality drugs, as well as other products following the latest treatment protocols. In the new RC, Lek will develop new and improved pharmaceutical forms of drugs, and intensify research and development in progressive drug delivery systems (planned and effective delivery of medicinal ingredients to the desired area in the body while minimizing side effects). Lek lives its mission, the concern for health and a better quality of life by always seeking to provide the patient with the newest, most up to date and patient friendly drugs.

In 2001, Lek’s R&D Unit had over 20 pharmaceutical products in different stages of development. This was also its primary activity. Two thirds of the drugs under development belong to the three most important indication areas of Lek (antibiotics, drugs for the treatment of cardiovascular diseases, and medicines for the alimentary track and metabolism). These drugs are intended for the traditional markets of Central and Eastern Europe, as well as the markets of the US and EU.

The new Research Center employs 226, all of whom have either associate or bachelor degrees. Ten percent also have PhD degrees in medicine, pharmacy, chemistry or biotechnology. The new RC also allows Lek’s researchers to collaborate more closely with Slovenian scientific institutes and faculties. Lek is also stepping up collaboration with research organizations abroad. This ensures the sharing and exchange of knowledge in the most current fields of science, particularly in pharmacy, medicine, chemistry and biology.

In the past few years, Lek has intensified internationalization of its business operations. Now, by consolidating all its research and development under one roof, in its new Research Center, and by forging closer ties with numerous research institutes at home and abroad, it is internationalizing its R&D activities as well.

This press release contains statements and conclusions based on projections of Lek’s future business operations. These estimates are derived from the best information currently available. In case these forecasts prove unreliable, the actual results could prove different from those projected.

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For additional information, please contact: Miša Komar Žiberna, Lek’s Corporate Communications Telephone: + 386 1 580 22 43