Anthropologists have confirmed that most Homo sapiens today carry one to four percent Neanderthal DNA. (My wife is convinced I received a larger contribution.) Potentially more damaging to our egos, Svante Paabo of the Max Planck Institute for Evolutionary Anthropology theorizes that we out-survived other Homo sapiens because of a gene mutation that makes us insanely explorative and major risk-takers.
In The Best American Science and Nature Writing 2012, Paabo mentions a “sort of Faustian restlessness,” and adds, somewhat less eloquently, “We are crazy in some way.”
Who might express this risk-taking gene in our industry if not the leaders of biotechs? Why else would a highly intelligent individual start a drug discovery company, despite possessing full knowledge of the odds for failure in an industry requiring over $1 billion and a decade to get a drug developed and approved?
Whether the three biotech CEOs I interviewed for this article are crazy or not, their risk-taking gene benefits society and increases the chances for individuals in the fight against diseases. But to continue this quasi-scientific investigation (if it rises to that level) and discern motives and behaviors, we must understand these Ph.D.-CEOs as they understand themselves. During separate interviews with Robert Gould (Epizyme), Hank Safferstein (Cognition Therapeutics), and Joe Payne (Arcturus Therapeutics), four main areas of commonality emerged:
1) A WAIT TO SET SAIL
All three entrepreneurs immediately embrace our anthropological theme. At first mention of Neanderthals and a human “crazy gene,” Robert Gould of Epizyme smiles wryly and thinks for a brief moment. “Certainly drug discovery is not for the faint of heart, nor for those who don’t want to take a long-term perspective,” he says.
Epizyme, founded in 2007, is a clinical-stage biopharmaceutical company based on the science of epigenetics. The company aspires to discover, develop, and commercialize personalized therapeutics for patients with genetically defined cancers. Gould was an early board member who became CEO in 2008. Previously, he was at the Broad Institute, and before that a VP at Merck Research Laboratories.
“I clearly understood the risks [of joining a start-up biotech], having spent 23 years at Merck,” he says, “but during my whole career I hoped and expected to apply myself to discovering drugs that make a difference in people’s lives. If you stay true to that motivation, you have to embrace a certain amount of risk-taking. For me, like many things in life, it comes back to having a north star to continue to guide you.”
Like modern-day Vasco da Gamas, our CEOs focus on a far-off horizon and patiently prepare for the long journey. Their steady-as-you-go outlook, though, is antithetical to that of the get-rich-quick ideal we often attach to modern entrepreneurs, particularly those in other industries.
While day-to-day fund-raising demands that these science-executives live a here-and-now existence, if that detracts from long-term goals, our CEOs say the potential for ultimate success is diminished. Patience is a virtue in our start-up world; in many cases, it is born of long experience.
This is a significant difference between bio and, for example, IT start-ups. IT is known for youthful entrepreneurship; our industry is led by those armed with Ph.D.s and often long years of industry experience. We’re more mature and steeped in the industry when we, to change the metaphor, grab the helm and head out to sea. For example, Safferstein became the CEO of Cognitive at the age of 43 after a career path through the NIH, BMS, and Acorda Therapeutics. Payne adds, “My whole life I’ve wanted to set up a company. I’ve been entrepreneurial since I was 5 years old. I’ve always been interested in science, and I would have pulled the trigger earlier if I could have gotten the right people and the right idea at the right time. But all the right things weren’t in place until years into my career.”
Therefore, in our knowledge-based industry dealing with human health, the entrepreneurial gene often needs to be kept in check for years. But once the timing is right, there is no holding back.
2) A PROFOUND BELIEF IN SUCCESS
Belief in ultimate success is so profound in these CEOs that at times during our conversations I interrupt to ensure we are talking about drugs and technology still in the clinic or about to get there. Their certainty slips them into the past tense, as if “their drugs” and “their delivery systems” were already approved, or at the least, a sure bet to be.
I actually feel guilty at points. I want to believe as they do that they have the next drug, synthesis of technologies, or delivery system to significantly better human existence. But the cynicism, if you will, about the awaiting clinic and its resultant data, looms large in the path of full acceptance.
Arcturus Therapeutics describes itself on its website as “poised to become an industry leader in the application of RNAi technologies for the treatment of disease and improved quality of life.” Payne, cofounder and CEO, says confidently, “We will prove our technologies next year, which will be a value inflection for our company,” affirming his drug and delivery platform will be in humans for the first time in 2015.
There should be a degree of confidence. Arcturus has developed a chemistry called UNA oligomers, a more flexible version of DNA and RNA. This chemistry is paired with a delivery system dubbed LUNAR™, which involves the application of a nanoparticle. The packaged technology is initially targeted at patients suffering from transthyretin-mediated familial amyloid cardiomyopathy (TTR-FAC), a serious, rare disease that leads to the formation of plaques that damage the heart, leading to death.
When I ask Safferstein of Cognition Therapeutics what phase his compound is in, he quickens his speech: “We discovered a novel target for Alzheimer’s disease, and we are hopeful we will be published on this soon. We are doing formulation, pulling the trigger on IND-enabling studies and deep into CMC. We are there.” To be clear, “there” is also a candidate moving towards the clinic in 2015.
The point here is that a clarity of vision — a near messianic message and belief of better things to come — is part of the make-up of biotech executives. That assuredness stems in large part from a philosophic approach to the risk factors inherent in their long-term endeavors.
3) RISK IS RELATIVE
Arcturus’ Payne puts risk in perspective — and its place. He is an Alberta-born, East- Coast-U.S.-trained, and now San Diegobased CEO. His career includes years at DuPont, Merck, and Japan’s Nitto Denko, as a scientist and manager.
“Sure, risk-taking is a part of my personality,” he says, still retaining a bit of his Canadian-English accent. “When I think of people who jump out of planes, I don’t know if they are crazy. I think they like the energy in that activity. The point is they recognize the risks and have done everything possible to mitigate them.”
“It gets to a point where you believe in your experience and capabilities and feel ready to jump from a corporate path to setting up a new company,” he continues. “It is risky, but there is still a high level of comfort.”
That comfort can be challenged quickly. The second day into his venture, and with a total initial investment of $50,000, the Arcturus business plan fell apart. “Our strategy was to license a certain technology, but we suddenly heard that it was not going to happen. We were sitting there going, ‘Oh crap, now it gets interesting.’”
"Certainly drug discovery is not for the faint of heart, nor for those who don’t want to take a long-term perspective."
CEO of Epizyme
Payne explains that in situations like these, you calmly reevaluate your options and strengths. “We knew it was an edgy strategy, but we also knew we could create and execute; we had enough education and career experience. Plan A didn’t work out, and I’m glad. Now we have this novel opportunity and expanded horizons because of what happened in the early days,” he says.
Gould from Epizyme says risk is mitigated by your strategy and the very technology and science you are bringing to the challenge. Epizyme is discovering first-in-class small molecules applied to new understanding of the cancer genome for personalized therapeutics in genetically defined patients. “You have to embrace a certain amount of risk-taking, particularly if you want to do it in a novel area combining a number of fields and sciences. In trying to bring all these together, we know there is a chance of failure, because that is what the history points to.”
However, says Gould, countering that risk is the fundamental understanding that cancer is a genetically identified disease. “If we can identify the patient population with the genetic changes that drive those cancers,” he explains, “we challenge that high-risk endeavor and make it less so. To say it in business terms, we improve our probabilities of success.”
“We thought strategically and drew analogies from the kinase inhibitors self-signaling world,” he says about the beginning of Epizyme. “In summary, we were looking at a panel of 20 enzymes that had the potential to be effective drug targets. If we are right only 25 percent of the time — just to pick a random number — those are still five very important targets.”
For Safferstein of Cognition Therapeutics, the risk is actually reversed. It is in not setting up his company and allowing the industry to continue on an unchallenged path, one he believes is not adequately serving patients. “The industry won’t take the real risks,” he says. “It’s as though Big Pharma companies have sort of stepped away from diseases like Alzheimer’s and ALS, and they are waiting for the science to advance.”
We hear more on how this drives Safferstein and the motivations of our other CEOs in our final section.
"Right now, my most important day-to-day task is raising money and educating institutional investors."
CEO of Arcturus Therapeutics
4) DRIVE NOT DEFINED BY DOLLARS
Business is business, and as such, is driven mostly by the bottom line. Mostly, not always. Our CEOs desire to do well (financially) by doing good (for society), but they are intently focused on the “good” side of the equation — none more convincingly than Safferstein.
“Twenty-eight years ago my dad was diagnosed with Lou Gehrig’s disease,” he says evenly. “At the time, I was astounded, we had no idea what to do, no way to treat ALS. And today we still struggle with this disease. This suggests to me the approaches in the industry may be misplaced.
“For diseases like Lou Gehrig’s, Alzheimer’s, Parkinson’s, and Huntington’s, we need to step back and remember how some of the most important drugs in our time were discovered,” Safferstein continues. “It was by looking at phenotypic changes in specific cells or systems and using those as a measure for finding new drugs.”
Safferstein lauds the power of the “finetuned approach” of genetics, epigenetics, and proteomics, but says, “We have focused on them too much.” He believes it is better to try to create the disease system to capture therapeutic approaches that work on multiple pathways in multiple ways. Placing this approach back in the mainstream is a goal for him.
“Companies must manage returns for investors and focus on share price, but at the end of the day, none of that exists unless we improve public health,” concludes Safferstein. “That really drives me to get up every day and keep doing what we’re doing.”
Of the three companies, only Epizyme has completed an IPO. But when I ask Gould about that successful financial market entry, he becomes intent upon my understanding what the IPO is “really all about.”
“It is important to understand why we did the IPO, and within that context, address what still motivates me on a day-to-day basis,” he says. “In my mind Epizyme is a unique juxtaposition of modern genome science, drug discovery, and the ability to focus on therapies for oncology patients. Presented with this unique opportunity, I wanted to make sure we were building a company that had the upside to be able to realize all of that potential.
“That means two things,” he explains. “We need to ensure adequate funding for the long haul, and that we are able to apply the kind of focus necessary to bring new medicines forward. We built the company in the context of early partnerships to get the platform off the ground, but always with the view of a potential IPO as a fund-raising enterprise. We will finish this year with more than $174 million in the bank, which enables us to continue to grow.
“So the IPO, to me, is very much another tool: You use drug discovery, robust clinical development, modern science and technologies, and financing.” Gould concludes, “It is in this context that I view the IPO.” Let’s be clear, though, for those readers looking to express their risk-taking gene someday as a biotech CEO: You will be focused relentlessly on funding.
Payne doesn’t hesitate when I ask his most important daily activity: “Right now, my most important day-to-day task is raising money and educating institutional investors about Arcturus. I have been traveling to New York, Boston, San Francisco, etc. drumming up interest from institutional investors.” Safferstein concurs without hesitation: “Primarily fund-raising and expanding our investor network. I need to make sure our nonscientific operations are up-tosnuff, and we are managing the budget.”
Perhaps because he’s had the “luxury” of a successful IPO, Gould of Epizyme takes a second to collect his thoughts, but then he, too, says, “The most important thing that I have to do during the day is ensure that all of the stakeholders in the company are staying aligned on the mission of the company.”
To end on a personal note, all three of our CEOs are married, have children, and say that although work-family balance is tilted a bit too much to the work side, they most enjoy spending time with their family. And Gould thinks he’s passed down the gene for risk-taking. “I have a son who lives in Alaska and studies earth science. He does ice climbing, ski patrol, and avalanche control. He recently sent us a picture of himself under a glacier. I guess getting back to our discussion of risk-taking genes, it runs in the family.”