That’s the dilemma facing drug hunters as leadership roles in biotech become more and more attractive.
You may have noticed that more and more seasoned pharma executives are making the move from big pharma or big biotech to lead small biotech companies. Jeff Jonas at Sage Therapeutics and Don Nicholson at Nimbus Discovery are great examples. The topic was covered a few months ago by LifeSciVC (here) in relation to the importance of the big pharma talent pool in driving expansion of the biotech sector.
Having made the transition from big pharma to biotech, I’d like to provide some additional color as to why this does happen, why this should happen (in some cases), what the transition might be like, and why big pharma management needs to pay close attention to their talent.
First – a little background. I took the plunge myself about six years ago, having spent just under 21 years at Novartis. Over the time I spent there, I learned first-hand how to discover and develop drugs, how to work in complex and heavily matrixed team settings, how to manage and develop people, build groups, run facilities, and when needed, how to “restructure.”
I enjoyed pretty much all of it, and found the senior executive lifestyle to be very seductive. At that level, the role is substantial, you’re treated like royalty, and you’ve got a great field of view overlooking the entire discovery portfolio. In my own case, though, even though I was overseeing big groups, had a drug on the market and several in development, it left me feeling unsatisfied.
Twenty-one years in, I was so far away from the action. At that level, my days were spent in a never-ending, hamster-wheel-like series of meetings focused on project progress, productivity, capacity allocation, HR, and putting out fires. I realized that – at 50 – I had plenty of time remaining in my career to use my skills to get closer to the discovery work I really loved, build new skills, and rediscover what I found to be fun in my career.
At the time, I wasn’t considering moving to a tiny company from my job at Novartis. Bruce Booth and Peter Barrett at Atlas, and Kevin Starr at Third Rock found me, talked me through the opportunity at Zafgen, and convinced me there was a good fit. I joined at a time when – despite my own belief that the world needs new therapies to treat obesity – the field had been abandoned by the industry. Six years later, we’re in Phase 3 with our lead molecule and have a small, but highly focused portfolio of our own. I haven’t looked back, and could not be happier. Zero regrets.
On the way through this process, I’ve had the chance to make some observations about the leap from big pharma, and I thought it might be useful to share them. Since leaving Novartis six years ago to join Zafgen, I’ve had the opportunity to meet with leaders throughout big pharma and big biotech. I’ve seen how they work. I can honestly say that these organizations are more alike than they are different. Please note that my comments do not single out any one specific company.
Welcome to the Machine – big pharma is called big pharma for a reason
With thousands of researchers under a single roof, typical big pharma discovery organizations lack agility. Organizations at that scale require bureaucracy, coordination, constant assessment, and controls. In big pharma, senior managers must control costs, uncertainty, and productivity at the portfolio level. This need for control and guaranteed output is jarringly disconnected from the scientists, who drive innovation and progress at the level of their individual projects. Creative scientists need and desire agility and a supportive environment, because they must take risks – scientific, professional, and personal risks – to see their projects through. It’s not just filling in time, or being a part of the pipeline to them.
Companies don’t discover drugs. People discover drugs.
In truth no one in big pharma management knows up front which program will succeed, any more than they could predict which pitch at a baseball game will become that ‘inside-the-park grand slam’. The way companies and management teams deal with it is to take the view that more pitches mean more chances of a grand slam. This is – in essence – the attrition model that has permeated the industry since the early 2000s.
The attrition model teaches big pharma managers to maximize the number of pitches thrown. The model mandates large portfolios of early projects to increase productivity and the chance of success.
In truth, it isn’t about pitches, or a mandate to start projects – it’s the scientist in pharma (or in most cases a small and tightly knit team of people) who come into their labs every day to bring their imaginations to life at the bench and thereby create unique insights about disease, ways to intervene, and craft therapies to treat illness and improve lives. They do this, often, against competing priorities imposed by their management, and through insights that can’t easily be explained or defended without further testing and empirical validation. This drive to innovate is what, I believe, is drawing many great big pharma leaders to move to biotech. Biotech is all about bringing nascent and delicately balanced ideas to bear in a focused manner.
Administrative goo is not your friend
Good and seasoned people end up spending their lives in big organizations fighting for their programs and wading through the thick administrative goo of big pharma. The reaction many big pharma execs have to the constant review cycles and decision-making meetings? Build an empire. Defend your turf. Run lots of projects. Avoid errors. Minimize risk. Try to convince yourself and your bosses that your portfolio is unique and innovative.
Bureaucracy has the added impact of providing cover for poor decisions, if they’re made. Committees shelter naysayers. Red tape is the enemy of innovation.
The committee-driven culture prevalent in big pharma leads to duplication of efforts throughout the industry. It’s “safer” to be comfortably numb and work on lower-risk but more validated approaches. But oh-boy is it expensive, and it isn’t anywhere near as rewarding or thrilling as being the first to explore a new approach.
So why come to biotech?
I get this question all the time. Biotech takes you out of the machine and lets you contribute as an individual. In coming to a biotech company, you commit to a greatly simplified approach to discovering and developing new therapies. It’s risky. It’s exciting. If you’re like me, that’s what got you into science or medicine in the first place.
If you make the change – know that it can be disorienting at first
You’ll need to adjust your expectations. Suddenly – after years of living a big pharma executive life – you’ll need to prove your worth. Your office will not be as nice. You may take a pay cut in exchange for a longer term stake in the company. You’ll probably end up making coffee, ordering your own office supplies, or unjamming the printer on a regular basis. You may struggle for the first months as an individual contributor. However, redefining yourself in this way is really, really, really good for you.
Believe in yourself – trust but verify
While getting settled, you may become frustrated or doubt your decision to move – but don’t give up on yourself. As you adjust, you’ll develop new skills and recognize how you can add value. Unlike in your former life, there simply aren’t buildings full of other people to do all of the work, so you’ll just have to roll up your sleeves and dig in. You’ll need to build your network to find ways to outsource your efforts. You’ll probably also realize that much of what you took for granted in your old job really was unnecessary – really unnecessary.
You’ll make mistakes and learn from them. It’s really good for you to let your guard down regarding infallibility and the need for the big portfolio. In time you’ll develop a more focused field of view, and you’ll be able to put your energy into driving forward with a single – and potentially valuable – innovative concept.
Feedback is important, too. If you’re smart you’ll develop a broad peer group of people working in companies that don’t compete with you. Coming from a large and competitive organization, you may be surprised to learn that these new peers are actually happy to help you succeed. Accept the support from these relationships and get their honest input on your ideas, approaches, and style.
You’ll also meet investors who are a fantastic source of perspective and support. In some cases they’ll ultimately help you find a path to additional opportunities. These people can add tremendous power to your career.
The IPO market is making things even better
In the 2000s, because the IPO market was very meager, coming to biotech meant – almost certainly – that you would have to eventually sell your programs or the whole company to big pharma to realize a return. I have to say that wasn’t a particularly satisfying idea – to come out of that environment simply to be bought by the highest bidder.
Today, coming to biotech means you may have the opportunity to go long and stay with your program, if that’s what you want. You can build a company with the focus, principles, and impact that matter to you (providing, of course, that you can sell that vision to investors and deliver on that potential). You can return to your own personal center to drive medical innovation and have fun doing it.
The IPO market – as long as it holds – is creating enormous career value for those of us who have taken the plunge.
Big pharma – are you paying attention?
These changing times in the biotech ecosystem should alarm senior leaders in big pharma and large cap biotech.
If you are a senior pharma leader, know that many of your most creative, capable, and innovative people will see that a career in (smaller) biotech can provide them with rapid career development and personal growth. A move now could bring a closer connection to the work they love most and freedom from that viscous bureaucratic goo. In biotech, your highest paid scientists can even make more money in the long term, and have more fun doing it. You should know they are being recruited even as you are reading this blog.
The great people coming into the biotech sector today are positive proof that the talent drain is in full force. It’s no wonder that bigger companies are working to externalize innovation and tap into the great talent that already has left to follow their ambitions and dreams in biotech. Big pharma organizations will need to seriously reconsider their operating model – or find other ways to increase their competitive edge – to cope with the departure of their top talent.
One size does not fit all
Let’s be clear – not everyone should consider moving from their big pharma / big biotech jobs to pursue a career in small biotech. It’s not uncommon for people to have been very successful in big pharma only to find that the small and tentatively funded biotech environment just isn’t a fit.
If you’re in big pharma and are still learning on a daily basis – stay there until you’ve learned all you can. Big companies can provide an amazing learning environment, and often will support your development of important leadership skills and problem-solving capabilities. If you’re considering the plunge, ask yourself if you’re ready to lead and thrive in uncharted waters.
These are exciting times – our industry is changing daily, and it’s going to be fun to see how it all sorts out. Great people have always made great things happen in our field, and they’ll drive the way important new ideas are brought to bear. New companies will emerge, innovative approaches will be taken and tested, and hopefully we’ll see even more new and impactful therapies come to market, led by people who are following their passion in small biotech companies.
For now, though, it’s clear – traditional and modern career paths for seasoned drug hunters are colliding, and the clash could be a good thing for all of us.