Forget the Shortcuts: Creating a Truly Innovative Biotech Culture

7/27/09

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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.

Stewart Lyman is Owner and Manager of Lyman BioPharma Consulting LLC in Seattle. He provides strategic advice to clients on their research programs, collaboration management issues, as well as preclinical data reviews. Follow @

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  • CMCguy

    You make many good points and especially agree with the getting the right mix of people as crucial. With that in mind there have been much failure in biotechs where good innovative science did not translate to satisfactory outcomes during development or achieve sufficient financial backing because did not bring on people with correct expertise to guide or support required growth. Often the “old organizations” overtly resists the changes, new functions or knowledgeable newcomers that are necessary in such an evolution to an actual company, not a research lab. A group of bench workers tend to know little about what development is and even less about finances.

    Although I do think big pharma has largely lost its way in recent decades, because as suggested seems to be much less science driven/lead (also more blockbuster blinded), I think there is a core of highly skilled and expert personnel that exists at most places who could be innovative and better enable the drug development activities

  • http://www.lymanbiopharma.com Stewart Lyman

    To further illustrate the conversion of Roche into Genentech, it was announced in mid October that the Genentech brand will replace the Roche brand on all drugs that are sold in the United States. This includes small molecules, Roche’s bread and butter for many, many years.

  • CMCguy

    Stewart I don’t understand the point of your follow-up comment on this re-branding name choice. I think this all has little if anything to do with Innovation but more so I see likely as a “clever” Marketing strategy to disassociate from public/political negatively viewed “Big Pharma” label to a more favorably perceived “Biotech” business. Roche may adopt some Genentech ways, particularly for certain areas (namely Biologics), but at its core doubtful will really change much.

  • http://www.lymanbiopharma.com Stewart Lyman

    Sorry I didn’t make this clearer. My point in this case was indeed not focused on innovation but branding and marketing. Yes, changing the products to say they are made by Genentech instead of Roche illustrates that the company wants to be associated more favorably with the biotech world and especially Genentech, which has a reputation for a highly innovative culture and products. This was something done for public consumption. But I doubt that the public at large paid any attention to Roche’s switch from PhRMA to BIO, or was aware of the move of scientists from the East Coast to the West. Roche may not be successful in remaking their culture, but from where I am watching it appears they recognize the need to change their research programs internally, and are at least hopeful that they can get the Genentech “magic” to rub off on the other parts of the company. Sometimes adopting the trappings of a successful culture can help to drive a change in that direction. Time will tell if they are successful or not.