is every bit as important in biotechnology as it is in personal finance. Companies that invest in only one scientific line of inquiry may find, like some of Bernie Madoff’s investors, that they rue the day they decided to put all of their eggs in a single basket. Many wanted to believe that technological breakthroughs, like the sequencing of the human genome, would translate in short order into new drugs. This is hopeful yet misguided thinking, because biology is amazingly complex, and advances based on this achievement are still years away.
Provide support personnel and equipment to grease the wheels
If you hire people to make breakthrough scientific discoveries, give them the support necessary so they can focus on their core mission. This means administrative assistants to help with manuscripts, photocopy papers, and conference registrations. Employ skilled graphic artists to craft scientific illustrations and figures to accompany seminars and manuscripts. Hire lab managers to order supplies, make media, and stock reagents. Buy the sophisticated equipment that will enable them to do cutting edge research. Do as much as you can do enable your scientists to do excellent science.
Hire the right mix of people
Advances in science spur new thoughts and new innovations. Having the proper mix of people to exploit these breakthroughs are critical to a young company. You need scientific acumen, skilled problem solvers, leadership skills, vision, and the organizational structure to get them all to work together. Science fiction movies are often filled with images of quirky scientists who have difficulties getting along with anybody, yet somehow save the day with their brilliance (exemplified by Jeff Goldblum in Jurassic Park, The Fly, or Independence Day). However, I find this doesn’t work in the real world. You need people who know how to play well with others in the scientific sandbox.
Leave scientific decisions in the hands of scientists
This seems obvious, but many biotech and pharma companies are led by individuals (often MBAs or lawyers) who know Wall Street inside out, but couldn’t distinguish a Northern blot from a Western blot, even with a compass and a GPS system (if you didn’t get that joke, you are one of those people). While companies without competent employees in all functional areas will have problems, one must trust each group to make the right decisions, and be held accountable for the work that they were hired to do. Cross training across job functions is helpful in gaining an appreciation of the bigger picture, but it is critically important to recognize that a research organization will ultimately live or die based on its research. Big pharma’s takeover by their marketing wizards at the expense of their science programs has led them to the precarious financial positions that they find themselves in at present.
Abandon “academic” constraints that stifle innovation
Put simply, this is just a reminder that research programs should have a significant component of “thinking outside of the box”. In a recent New York Times article, Gina Kolata illustrated how funding agencies such as the National Institutes of Health push academic researchers to avoid innovative research by not funding ideas outside of the mainstream. Since many industry researchers cut their scientific teeth in academia, it’s challenging to switch their mentality toward a culture that rewards, and doesn’t punish, innovation. Industry thrives on this type of thinking, with people who are willing to explore new concepts, ideas, and approaches.
I’ll save for another column a detailed explanation of why I think Roche felt compelled to implement this change in their culture. Here’s a hint: biologics comprised five of the top ten selling drugs in 2008, are expected to hit $100 billion in sales in 2011, and are not nearly as vulnerable to generics as small molecules. Many of the cultural issues that I address above will not be cheap to implement. Based on what I have seen of the industry in recent years, there is currently a bias against financing the types of organizations that have these research cultures as being too slow and too expensive, resulting in too long a time period to recoup investments. The lengthy time frame serves to drive potential investors into other industries, like software, where financial returns can be achieved much more quickly. But there really aren’t any shortcuts in biotech when it comes to innovation. I believe the high failure rate of drugs in clinical trials in recent years can be blamed on them being rushed into the clinic for financial reasons when they were not really ready for prime-time. Companies that aspire to be the next Genentech have to be prepared to establish a kind of science-driven culture at their foundation, and invest in it over the long haul, however financially unpopular it may be at the moment. A solution to this dilemma will not easily be found, but is certainly worth searching for. Those of us who follow the industry closely look forward to seeing how the next few years play out in terms of who is ultimately successful in the industry, and why.
