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Another drug giant bringing jobs to Mass.

Michelle Wenck worked with human cell cultures at Sanofi-Aventis in Cambridge Friday. The firm aims to establish a joint headquarters for a new cancer division in the city. Michelle Wenck worked with human cell cultures at Sanofi-Aventis in Cambridge Friday. The firm aims to establish a joint headquarters for a new cancer division in the city. (Wendy Maeda/Globe Staff)
By Todd Wallack
Globe Staff / July 8, 2010

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One of the world’s largest drug makers, Sanofi-Aventis SA, is planning a $65 million expansion in Cambridge that will create about 300 jobs, making it the latest foreign pharmaceutical giant to invest in Massachusetts.

The Paris-based drug maker is in the process of leasing space in Cambridgeport, where it will establish a joint headquarters for a new cancer division.

“We believe that Cambridge is really the heart of oncology today,’’ Hanspeter Spek, president of Sanofi-Aventis’s global operations, told financial analysts and investors in a conference call earlier this year. “We intend to benefit from this environment as a neighbor.’’

Sanofi-Aventis is the latest foreign drug maker expanding its operations in Massachusetts. Industry executives say the companies are drawn to the intense concentration of medical and life sciences activities in the area, including top-flight research universities, respected hospitals, and a cluster of biotechnology companies.

The company’s investment is particularly important because it comes at a time when many other businesses are reluctant to expand because of the weak economy. And pharmaceutical research, manufacturing, and management jobs tend to pay well and pump new money into the economy, benefiting ancillary businesses such as suppliers, law firms, and nearby hotels and restaurants. Sanofi-Aventis predicted the new jobs would pay an average of more than $100,000 per year.

Governor Deval Patrick has also been counting on growth in the industry to help lift the state’s economy. Two years ago, Patrick launched a $1 billion, 10-year initiative that includes tax incentives for life sciences companies to expand, research grants for scientists, and money to build university labs and other public infrastructure to support the industry.

Just last week, 56 life sciences companies, including Sanofi-Aventis, applied for $25 million in tax credits available this year, according to Angus McQuilken, a spokesman for the Massachusetts Life Sciences Center, a quasi-public agency established by the state Legislature in 2006 and charged with implementing the initiative. The tax credits will be awarded in December. Last year, 26 firms received $24.5 million.

Industry officials said the Sanofi-Aventis move reaffirms Massachusetts’ standing as one of the country’s leading hubs for drug industry research.

“We’ve done well, posting some significant wins,’’ said Robert Coughlin, president of the Massachusetts Biotechnology Council, an industry group.

More than a half dozen other major European and Asian pharmaceutical companies have major operations in the Boston area, including Swiss drug maker Novartis AG, Merck KGaA of Germany, Japanese drug makers Takeda Pharmaceutical Co. and Dainippon Sumitomo Pharma Co., and British pharma giants GlaxoSmithKline PLC, AstraZeneca PLC, and Shire PLC.

And despite the downturn, several life science firms are adding employees in Massachusetts, either through internal expansion or by acquisitions of other companies.

Two years ago, Shire launched a $394 million expansion in Lexington, including building a new manufacturing plant and headquarters for its Human Genetic Therapies unit, which develops drugs to treat rare medical disorders, such as Fabry disease. The company, which received $48 million in incentives to expand in Massachusetts instead of in another state vying for the project, has 1,300 employees and expects to add as many as 300 more by 2015. Shire recently inked a $165 million deal to buy several of the buildings it was leasing in Lexington.

Merck is completing a $65 million research-and-development center in Billerica for its EMD Serono unit and recently agreed to buy Millipore Corp., a Billerica company that provides equipment and services to the life sciences industry, for $6 billion. Dainippon Sumitomo Pharma Co. acquired Sepracor Inc,. the Marlborough company behind the Lunesta sleep medicine, for $2.6 billion in April.

“We are continuing to see investment growth here even in places where they might be shrinking in other parts of the world,’’ said Susan Windham-Bannister, the Life Sciences Center’s president.

Overall, the Massachusetts biotechnology and pharmaceutical industry had more than 45,900 workers in 2008, the latest estimate available, up 43 percent from 2001, according to the biotechnology council.

Sanofi-Aventis has nearly 400 workers in Massachusetts, including 160 in Cambridge, largely through its 2008 acquisition of Acambis, a vaccine maker based in England. It also owns a small manufacturing facility in Canton.

The new cancer operation in Cambridgeport will boost those numbers considerably. Sanofi-Aventis has posted dozens of jobs related to the new division headquarters on its website, including for laboratory research, clinical trials, and marketing. It has sublet 30,000 square feet of space elsewhere in Cambridge, but is now close to leasing 112,000 square feet at 640 Memorial Drive, an MIT-owned building aimed at life sciences companies, for the new division headquarters. The Cambridge location will share control of the cancer division with a Sanofi-Aventis office in Vitry, France.

Company spokesman Jack Cox said the firm hopes to finalize a lease in the next few weeks.

To help support the expansion, Sanofi-Aventis also applied this month for $2.45 million in state tax credits from the Life Sciences Center and plans to request another $6.5 million in aid over the next four years, according to the center.

Like other major pharmaceutical companies, Sanofi-Aventis is making a big bet on cancer drugs. Last month it announced plans to buy San Diego biotechnology firm TargeGen Inc., which is developing a treatment for certain types of leukemia, lymphoma, and other blood disorders, for $75 million, plus up to $485 million in additional incentives. Last year it agreed to pay up to $500 million for BiPar Sciences, which is developing a new class of “tumor-selective drugs’’ to treat multiple types of cancer. BiPar is based outside San Francisco.

Sanofi-Aventis, which also has major operations in Pennsylvania, New Jersey, and elsewhere in the United States, already has two blockbuster cancer drugs. Taxotere, a chemotherapy drug used to treat breast cancer, prostate cancer, and other types of cancers, generated $2.8 billion in sales last year. Eloxatin, used to treat colorectal cancer, reaped more than $1.2 billion for Sanofi-Aventis last year.

Last month, the US Food and Drug Administration approved Sanofi-Aventis’s Jevtana to be used in combination with another drug to treat metastatic hormone-refractory prostate cancer, and the company has an array of additional cancer drugs in its pipeline.

It has also been working with Massachusetts biotechnology firms to develop new drugs, including deals related to cancer research with Dyax Corp. in Cambridge, ImmunoGen Inc. in Waltham, and Merrimack Pharmaceuticals Inc. in Cambridge.

Debasish Roychowdhury, who runs Sanofi-Aventis’s new oncology unit, praised Cambridge yesterday in a statement as a natural choice for the joint headquarters “given the city’s role as one of the world’s most important centers for biotech research and talented oncology minds.’’

Todd Wallack can be reached at twallack@globe.com.