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From Site Selection magazine, April 2011

Biologistics Hub

Life sciences companies are choosing Belgium for regional distribution.


Janssen officials are pictured holding groundbreaking ceremonies for a new distribution center in Wallonia last October.
Photo Courtesy of Janssen Pharmaceuticals

elgium's well-known status as a logistics hub is bringing the country into focus for life sciences companies looking to site major regional distribution centers. One such company is Janssen Pharmaceuticals, a division of Johnson & Johnson.

Construction is under way on Janssen's new 270,000-sq.-ft. (25,000-sq.-m.) facility in La Louvière in Wallonia. The new European Distribution Center, which will be about 45 km. (28 miles) south of Brussels, will become operational in early 2012, and will employ 100 to 135 people when fully operational in 2013. The site also has room for possible future expansions. The facility will store close to 4,000 pharmaceutical products, both human and veterinary, which will be delivered to customers across Europe as well as affiliates around the world.

Janssen says that, together with three satellite centers, the new logistics center will bundle the activities of the 15 centers currently in operation. As a result, the number of steps in the delivery chain will be reduced: The medicines will be shipped directly to the European Distribution Center from the production branches in Beerse, Belgium; Latina, Italy; and Schaffhausen, Switzerland, and from there directly to customers.

"We needed to have a more central approach to delivering our packages to customers across the region," says Stefan Gijssels, vice president, communications and public affairs for Janssen in the EMEA region. "With France, Germany and then the U.K. for our markets, we needed a location south of Brussels because there are traffic problems north of Brussels. We wanted to avoid traffic congestion. We made a short list, looked at all the different areas and finally, we concluded that it would be best to go to Wallonia."

Gijssels says two factors led to Janssen's decision: proximity of the nearby distribution center of Janssen's parent company, Johnson & Johnson, and grants available from the Wallonia government.

"The European Commission offers subsidies in areas where there is a clear social-economic need for development. These are areas with high unemployment and limited industrial activity. There is one part of Wallonia that qualifies. The project received €11 million [US$16 million] out of a total investment of €47 million [US$68.5 million]. It's a substantial amount of money. A few years ago when we set up our medical device distribution center, nine kilometers away, we also benefited from grants."

Johnson & Johnson opened that distribution center in Courcelles in 2007. It currently employs 274.

Gijssels says other factors involved in the site decision included good logistics support, available work force and proximity of airports and railways.

"We have overnight delivery by truck," Gijssels says. "The biggest part of our transportation is by trucks, which is still the fastest way. We deliver to hospitals across the region. In the south of Europe, we have satellite warehouses in Italy, Greece and Spain. We occasionally move shipments by train or plane, depending on the situation. Wallonia has very good highway connections to Germany, the Netherlands and to the U.K."

Gijssels notes that the government of Wallonia has made a big effort to attract biotech companies. He says the current logistics expansions are being influenced in part by the presence of large pharmaceutical companies such as GlaxoSmithKline, which has its largest vaccine plant in Wallonia, where GSK employs more than 7,000.

"Wallonia could be a real hub in Europe for biologistics," Gijssels says.

CEVA Logistics, which manages the J&J distribution center, will also manage the Janssen facility.

"The full employment will be on the CEVA payroll, but we will supervise both distribution centers centrally," Gijssels says.

Janssen also opened its €130-million (US$190-million) pilot plant in Geel, Belgium, last October. The plant will develop chemicals for clinical research and will also produce small volumes of medicines.

The Site Selection Life Sciences Report features exclusive and in-depth reporting and analysis on the most important life science projects and issues. Topics covered include pharmaceutical R&D and manufacturing, biotechnology, medical device manufacturing, health-care services facility trends, clinical research and other key life science sectors.


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