BIO in Boston 2012
Posted By: Molly Robb, 6/25/2012
I am quite lucky to have graduated from the University of Wisconsin-Madison. Not only is the University of Wisconsin-Madison known for having an exciting athletic program, a cutting edge stem cell research program, selling the first batch of Botox to Allergan in 1988; but it can also boast close ties to one of the most interesting and most accomplished life sciences leaders in the world. A University of Wisconsin-Madison graduate, Steven Burrill is the Founder and Chief Executive Officer of Burrill & Company, and has been involved in the growth and prosperity of the biotechnology industry for more than 45 years. An early pioneer, Steve is one of the original architects of the industry, one of the catalysts for the formation of BIO and one of life sciences most avid and sustained developers. During BIO in Boston this week, I was lucky enough to secure an invitation to a University of Wisconsin-Madison private dinner at Turner Fisheries inside the Westin Copley Center. At this intimate gathering, I was fortunate enough to have a chance to meet Steven and to listen to his presentation based on the Annual Report his company produces each year on the Life Sciences industry. Some of his more fascinating observations included:
1) Innovation in the New Austerity: R&D spending by the industry typically grows predictably year after year; but that was not the case in 2011. In part, such a move was in response to the long anticipated drop in revenues Big Pharma faced with the loss of patent protection on some of the industry’s best selling drugs. But it also was an acknowledgment for many that the R&D spending had failed to yield an adequate return on investment. I can personally validate this change and have seen this reflected in my own search business over the last year which has generated more retainer searches for roles that are located in the commercial side of the business.
2) Gray Matters: Around the world, life spans are increasing and populations are aging. While policy makers across the globe have taken steps to look for ways to restrict spending, others are turning to innovative approaches that can keep people healthy and allow them to live independently. No other state in the union like Wisconsin can say they have seen such intense political unrest and turmoil over the government’s attempts to restrict funding. Furthermore, from my own search practice experience, I noticed that the healthcare companies that are dedicated to developing new and innovative ways to improve the quality of life for the aging populations seem to be the companies who were actively hiring in the last year. Governments will still have to fight the political battles of where the funding should go; but in an age where the populations are living longer and the rapid advancements in science are shifting the focus from treating acute symptoms to treating and curing chronic diseases, this debate is going to get even more heated. Hopefully, states like Wisconsin that have found themselves on the forefront of this upheaval, will also show leadership in generating innovative solutions as well.
3) Connected to Health: The convergence of information technology and the life sciences, couple with ubiquitous connectivity, is revolutionizing the way healthcare is accessed and delivered. Today, a new generation of companies is harnessing information and communication technologies not only to improve care, but also to help people stay well. The phenomena will bend the cost curve of healthcare through improved monitoring of chronic disease and by enabling people to change their behaviors in ways that keep them healthy. Steve showed the audience his phone which he then held against his chest. To the audience’s surprise, the phone immediately turned into an ECG monitor displaying blips and data charts on his phone. Steve went on to explain that his new company, AliveCor, will take the real time data from his phone and send it to Steve’s cardiologist so that the cardiologist could read and interpret the information. Clearly, this type of disruptive point-of-care technology will change the standard of care for patients and challenge our current view of how we are using our community hospitals. Evidence of this transformation is seen in the Mini Clinics that will soon be available at a local CVS, Safeway or Walgreens. Companies that are developing innovative technologies to enhance this new physician – patient interaction are going to have the opportunity to put their footprint on the industry and transform the economics and delivery of healthcare worldwide.
4) Buying Innovation: Access to innovation is driving M&A activity, as companies embrace innovative products as the way to best grow in a world where they will need to not only demonstrate safety and efficacy, but value as well. As the industry seeks to address its lack of R&D productivity, it is increasingly looking outside its own walls to research and discovery deals that lead to promising early-stage drug candidates. In my networking with a VP level Human Resources professional from a Big Pharmaceutical company, she indicated that this change has evolved the way her company is now viewing their core competencies. Where innovation and the R&D pipeline used to be the secret sauce to their success; now Large Pharmaceutical companies are reinventing themselves in order to survive and viewing their core competencies differently in favor of marketing, distribution and the ability to protect and defend highly valued patents. The serge of discovery alliances that Big Pharma has made with Academia is another indication of this change and speaks volumes about this paradigm shift.
5) Exit Strategies: The life sciences industry continues to attract new ideas and people who are dedicated to improving lives around the world. But financing life sciences companies is changing as new deal structures evolve to address the problems entrepreneurs and investors face in the risk-adverse and often volatile financial climate the now exists. In my own search practice, I have seen biotechnology clients having to hang on longer than ever before in order to meet and overcome new clinical development milestones and tougher FDA hurdles before their companies are deemed attractive targets for M&A. The challenge for these companies is to make sure they are developing game changing products that can fulfill unmet medical needs of the population, deliver real value in cost to all of the stakeholders, and improve health outcomes.
In addition to these fascinating topics, there were several other interesting points Steven touched on in the presentation around the rise of developing nations in Asia, Latin America and the middle class in other parts of the world where these new economic heavyweights will be a target of the life sciences industry in the years to come. In addition, Steve briefly touched on the importance of innovation and advancing the drive towards commercialization in energy security and food security.
In all, there was just too much to talk about in one evening, and like Cinderella running out too early, Steve had to run off to his third and final presentation for the day. So after generously answering a few questions from the audience, he had to leave. I imagine he arrived at his next destination just a little after 9:30 pm where I am sure he mesmerized yet another crowd of eager listeners with his observations.
Molly Robb is a Principal Consultant of Horton International, located in Boston, MA.