How to Raise $50M in a Recession: Highlights from the Xconomy Life Sciences Forum
Some of biotech’s most innovative drugs emerged under the worst financial conditions. Two big breakthroughs in the 1990s, Enbrel for rheumatoid arthritis and Rituxan for lymphoma, came from small biotech companies that toiled for years, and survived brushes with extinction, before they made it.
This history lesson came up in conversations I had with entrepreneurs after the Xconomy Forum: Tomorrow’s Biotech—Innovators and Innovations, which we held yesterday at Biogen Idec in Cambridge, MA. The people who enter this business need a rare combination of intellect and tenacity to survive in a business where 9 out of 10 drugs that enter clinical trials fail, and where it takes more than a decade and hundreds of millions of dollars to develop a drug, even in good times. So it was fascinating to hear people describe the grim realities of the economy as simply another obstacle they need to overcome—and not an insurmountable one.
Startup founders and CEOs participating in the forum covered a lot of ground about creative ways biotech companies are seeking to clear these hurdles by raising money, improving the odds in drug development, and lowering costs. Of course there’s no one simple way to build and sustain a new company, and indeed the forum highlighted some completely opposite strategies.
Meanwhile, the heads of some of the most innovative programs at public biotechs—Biogen Idec’s Gilmore N. O’Neill, Genzyme’s Sam Wadsworth, and Vertex Pharmaceuticals’ Eric Olson, moderated by GlaxoSmithKline’s Michelle Dipp—shared their perspectives on what it takes to foster new ideas and treatments in the public-company context. (FYI, none of them officially condone submarine projects, wink wink nudge nudge.) We also heard from some pioneers of the biotech industry—Walter Gilbert and George Church—during a keynote chat, although I’m saving up highlights from an interview with Church for next week, so watch this space.
Thanks to all who joined the conversation yesterday. And if you missed it, here are some of the highlights from the entrepreneurs at the Forum:
—Peter Hecht, CEO of Cambridge, MA-based Ironwood Pharmaceuticals, talked about his secret for being able to raise $281 million over the past 11 years to build his company, which now has 160 employees. “We’re crazy-passionate about building a great company and doing it over the long haul,” he said, with a sense of purpose that made it sound like more than a platitude.
This guiding principle has enabled Hecht to pull together investors like Polaris Venture Partners and Venrock Associates to support the company—without agitating for a quick acquisition to get fast returns. By sticking with this consistent … Next Page »