CELL - A Management StudyTM Canadian Excellence in Leadership in the Life Sciences

---

By Christine Koenig
Rational drug design, target driven therapeutic approaches, biologics, individualized therapy, molecular diagnostics and biomarkers are the state-of-the-art in a new drug development area, one could think when reading the headlines, but wait – no, we are not quite there yet!

But why are we progressing so slowly in bringing innovative approaches to the patients? There are a few very good reasons that can be summarized as a serious lack of smart money for early stage commercial development in Canada.

Firstly, it is true, the collective global bio-medical knowledge has exploded since the beginning of the genomics area and the number of data mines (e.g. Genomics, Proteomics and Metabolomics etc.) ready to exploit is growing exponentially. But who is actually exploiting them? Well, it’s that small, early stage and chronically under funded Biotech industry. Few companies indeed eventually do find gold nuggets but most others rapidly retract to making better tools or providing research services to those who still hope, keep digging and persist.

Secondly, those who have shaped and dominated the drug development industry in the past, Big Pharma and their CROs, are spoiled by decades of success with blockbuster small molecule drugs, and have build close to no knowledge on how to develop innovative biologicals. Most Pharma giants have only very recently or not even yet recognized and accepted how important it will be for their future survival to adopt new drug development strategies and processes (from the Biotech industry).

Thirdly, most investors are risk adverse and have burnt their fingers when the IT bubble burst and thus prefer to act as interested bystanders, hesitantly dipping their toes into the water here and there, and only jointly and slowly move forward, while seeking advice from the experts in drug development, mostly retired Pharma managers now turned into consultants.

What will it take for the Canadian Biotech industry to rise from the valley-of-death, lift off and deliver on its promise to innovate and create new and better diagnostics, therapies, and drugs?

Now, there is lots of buzz about what everyone is doing (e.g. patent filings, pre-clinical and clinical research, tools, technologies, etc.) but little to hardly ever it is talked openly about the how and, more precisely, about how the ones (i.e. CEOs) that orchestrate those tools and systems lead, enable and perform. At Koenig & Consultants Inc., we share the view of the majority of the decision makers in the industry that the management’s team competence is the most important predictor for success, more so than all the rest (see above). But what identifies excellent management? And how do excellent CEOs lead their team to excellence?

These questions were the inspiration behind CELL – A Management Study™, the first of its kind. CELL™ is a, for now, Canada-wide study that probes into the management practices of Biotech companies, in the areas of Strategy, Marketing, Communication and Leadership. The questions addressed to the CEOs included in this study were designed to elucidate the processes and the how-do-you-do rather that the results and successes. In the course of the study, CEOs of 23 Canadian companies, that have been recognized with national awards and accolades and thereby serve as role models for the Life Science industry were interviewed about their management practices.

Vision, passion & a sincere interest in people
It seems that being a great leader in Biotech does not depend on academic background or former professional experience. It rather depends on the personality and the conviction and dedication for leading the company, by leading its people towards their common goals. The excellent leaders we interviewed rely on two pillars to achieve these goals - systems and structures, and efficient and transparent communication with their people. An international experience and understanding of global culture supports these CEOs in communicating with and motivating a diverse team. Many of the companies we interviewed have very well defined internal communication guidelines including the conduct of meetings, email correspondence, use of Blackberries, etc. These ensure a steady, reliable and transparent flow of information while still encouraging informal and creative discussions.

Although unanimously considered very important, Leadership development is the area (of the four we discussed) that suffers the most currently. In today’s tight economic environment, leadership and management development programs are red-taped. About half of the companies in our study included ‘leadership performance’ as an assessment criterion in the employee appraisal process, but only a third organized or invested in some kind of leadership & management skills training for their employees.

Adaptable strategy & customer benefit
A clear vision is not only an important starting point for developing a strategy, later down the road it serves to re-engage the team when the going gets tough. 70% of the CEOs interviewed make use of the power of vision & mission statements, leaving still a significant number of 30% without it. As one CEO pointed out, “If we know where we are heading, we have a much better chance of getting there”. The majority of the CEOs saw it as their core duty and responsibility to guide a systematic development and review process of their strategy and thus enabling and allowing for adaptation to changing market environments, whenever appropriate.

A few of the companies we interviewed have truly understood that the scientists are the ones who must understand the customers’ needs and benefits, because it is their job to generate a product that delivers. It is understood by this group of CEOs that definition and communication of the customer benefit to be delivered is most effective at the interface of product developers/scientists and their champions in the target market. In many cases, the CEOs themselves take care of the marketing and/or business development function by overseeing this interface. However, in the majority (60%) of the companies in our study, this responsibility was taken on by a dedicated marketing/business development function. A vast majority (80%) of the companies included in the study consistently do a product portfolio analysis. This tool helps the CEO monitor and communicate the potential and progress of the portfolio, thereby facilitating the strategic decision-making.

Enabling Excellence
The excellent Canadian Life Science managers act as ‘enablers’, driving their company’s strategy and policies, establishing efficient processes in internal and external communication, marketing and business development, and above all, motivating and engaging their people and partners in creating their company’s future. The interviews performed with a select group of recognized companies proved that there are indeed exceptional leaders with outstanding leadership and communication abilities.

Many of those are not ‘home-grown’, but have an international background. As analogized earlier, results in the way of revenues, stock prices, or other business performance indicators are too premature to serve as evaluation criteria for management practices. Which is why an evaluation model such as the one adapted for this study might serve as a fairer approach to analyse the Life Sciences companies and their management, at least at this stage of the industry.

The fully comprehensive management report based on the analyses of these interviews, along with a collection of show-cases of good practices was been released in March 2010. To receive a hard copy or a PDF mail to: info@koenigconsultants.ca