Wednesday, July 8, 2015

Bio-entrepreneurs in land of the giants

Something's been bugging me since I attended the annual awards dinner of Pennsylvania Bio last week.

Bio-entrepreneurs in land of the giants

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Frank Baldino Jr. (left), founder of Cephalon Inc., and Hubert J.P. Schoemaker, the founder of Centocor Inc. They are the Philadelphia region’s biotechnology giants.
Frank Baldino Jr. (left), founder of Cephalon Inc., and Hubert J.P. Schoemaker, the founder of Centocor Inc. They are the Philadelphia region’s biotechnology giants.
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Something's been bugging me since I attended the annual awards dinner of Pennsylvania Bio last week.

Organizers strove to balance the somber tribute to the late Frank Baldino Jr., founder of Cephalon Inc., with the anticipation over awards celebrating the past year's top deals and proven leaders.

Repeatedly, the more than 900 people at the Convention Center were told that they were "standing on the shoulders of giants," a quote often associated with Isaac Newton.

The Philadelphia region's biotechnology giants are Baldino, who died of leukemia in December; and Hubert J.P. Schoemaker, the founder of Centocor Inc., who died in 2006.

They were strong-willed entrepreneurs and scientists who began their companies during biotech's early years - Centocor in 1979, Cephalon in 1987. Both encountered crushing defeats in the clinical testing of their initial compounds, adjusted their strategies, and wound up building large, profitable life-sciences firms.

Through years of raising capital, expanding operations, downsizing them, and acquiring new compounds or companies, Baldino and Schoemaker showed Philadelphia's Big Pharma establishment just what smaller, nimbler organizations could accomplish.

As for what's been nibbling at the back of my brain, I've been wondering if we'll ever see another life-sciences giant like Baldino or Schoemaker again.

For one thing, the biotechnology industry's Wild West days are over. No one dreams of building the next Amgen Inc. to challenge the biggest drug companies. With Big Pharma more amenable to licensing compounds and acquiring small biotech firms, the go-it-alone strategy simply isn't pursued anymore.

As one of its "deals of the year," Pennsylvania Bio chose Avid Radiopharmaceuticals Inc., the West Philadelphia company that was acquired by Eli Lilly & Co. in December for up to $800 million.

Avid had come a long way since it was started in 2004 based on molecular imaging technology from the University of Pennsylvania. But wherever it goes from here, the journey will be conducted as a unit of a larger company.

As part of a bigger company, would founder and CEO Daniel M. Skovronsky be considered a giant if he could surmount the challenge posed by the Food and Drug Administration's recent delay in approving Avid's Amyvid imaging tool to detect beta-amyloid plaque, which researchers associate with Alzheimer's disease?

How about Peter R. Dolan, chairman and CEO of Gemin X Pharmaceuticals Inc., the Malvern cancer-drug firm that Cephalon agreed earlier this week to acquire for up to $525 million? Its lead product, obatoclax, is being tested as a possible treatment for small-cell lung cancer.

Couple a brutal fund-raising environment for biotech with product-starved pharmaceutical companies, and it's hard to see the best-and-brightest remaining independent long enough to build their profile outside of the labs, boardrooms and lawyer's offices where they spend so much of their time.

And perhaps the drug-development risks - financial, clinical, regulatory, legal - have simply grown too great for entrepreneurial hubris to overcome.

The good news for this region is that there are plenty of life-sciences entrepreneurs who are not only willing to take their shot, but also are doing it right here. Some may succeed, most will fail, and many will try again.

That so many Philadelphians are now willing to try is the true legacy of Frank Baldino and Hubert Schoemaker, not the large Cephalon and Centocor footprints that still dot the suburbs.

 


Contact Mike Armstrong at 215-854-2980 or marmstrong@phillynews.com. See his blog at www.phillyinc.biz.

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About this blog
Mike Armstrong blogs about Philadelphia corporations and business-related topics. Contact him at 215-854-2980. Reach Mike at marmstrong@phillynews.com.

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