Little matters more to Roz Potter than the health and well-being of the patients at the end of the pharmaceutical pipeline: “People tend to forget that, at the end of this process, there’s a patient who is hoping that someone comes up with something to help them.” After a long career in the pharmaceutical industry, Roz now spends her time as a consultant in biomedical principles, where she still keeps up with the state of the pharmaceutical industry.
Roz recently spoke with Propel(x) about how the pharma industry has grown and what it still needs to do to reach its full potential.
Propel(x): You had a very long career in pharmaceuticals, so what are some of your fondest memories and proudest achievements?
Potter: Before I went into pharmaceuticals, I was a teacher of both high school and college. I taught my favorite subjects, biochemistry and genetics, and I loved it. To this day, I sometimes still miss it.
Propel(x): How did you get your start in the pharmaceutical industry?
Potter: I started out at Hoffmann La Roche back in 1981. After a while, it seemed that there was a gap having to do with information. All the people in the lab who had been told they were brilliant all their lives, were really not very good at scientific literature and patent searching. We created a function where people who were versed in science, would perform that research. And instead of just reporting a bunch of citations, we’d actually go through the articles and perform analyses geared for that scientist’s request. Later, patent law, development, used our services.
As time progressed, it seemed to me that there was another gap. When companies are considering collaboration, acquisition, or even looking at competitors, they use what they call “competitive intelligence.” This is usually on the business side, and the questions that are being asked and answered have to do with how much profit can be made off a new drug or a pipeline. To me, that was partially missing the point. How can you ask how much you’re going to make, if you haven’t asked, will it work? And so a new discipline of scientific intelligence came to be.
Propel(x): That’s fascinating. How do you combine the business insight part of due diligence on a potential acquisition target with the scientific part? And did you as scientist have any influence on the valuation of the deal?
Potter: I didn’t give them the business valuation. That was not my purview. They made a double-end scoring, one into the business intelligence group and one to me because neither business intelligence nor scientific intelligence should operate separately or one in favor of the other. You need to ask both questions. The questions you need to ask is on potential valuation and the other question is will it really do this? Will it work the way they say it will? And if you skip other questions, you’re missing the boat. How do you invest in something even though it has the potential for a billion dollars if you don’t know if it’s going to work or not? When you look at the record as to how many compounds actually make to approval, that’s a hell of a risk to take.
Example 1: A small company could not afford clinical trials for the unique first in class compound. The business people could not evaluate it, because it was unique and there was nothing to compare it to. I looked at the science by reading the original papers (no databases yet), and fell in love with the mechanism. Roche not only wanted to know if the compound would work, they wanted to know why this company was asking such an extraordinary price for “collaboration.” I found that in a subset of patients, those with a particular mutation, the drug should work very well. In addition, since that mutation existed in several cancers, there were a number as yet undisclosed indications, hence the high asking price. Roche agreed with my evaluation, entered the collaboration, and after more than twenty years, that drug is still highly effective, and a great money earner.
Example 2. A large pharma claimed to be investigating the inhibition of same receptor that my then company was looking at. The difference was that they were in clinical development, and we were in preclinical, and so a risk was recognized. Based on the side effects profile, I determined that the competitor was not working on precisely the same receptor, and urged my company to continue our research, The company chose to discontinue the program, the competitor produced a drug with fairly low efficacy and very significant toxicity. Sometimes your advice is not taken…
Prope(x): That kind of risk is reminiscent of Theranos. What do you think went wrong there? I mean, even without data, how did it attract so many investments if they didn’t even have the science cracked?
Potter: For all the progress that the pharmaceutical industry makes, it’s still a very old and conservative business. Their approach to evaluate drug candidates hasn’t changed in more than 100 years. The science and business sides generally don’t work closely together, and they should.
For most people sitting in the C suite, the bottom line is terribly important. And it doesn’t occur to most of them that there’s a second approach that should be used in conjunction with the business approach. The two should always be together. Neither one takes precedence over the other. You want to know if it’s worth the effort and have a financial perspective.
From the science perspective you want to know: will it work, how will it work, and will it work in more ways than they told you, what is the side effect profile, who else is working on it, and are they a threat?
Propel(x): Do you feel today that the big pharmaceutical players have adopted this approach because they saw that your approach at La Roche delivered? Do you think other players are making similar decisions?
Potter: To some degree. I have described my methodology at numerous meetings and some companies have adapted it to meet their needs.
Propel(x): And do individual investors or venture funds who are getting into pharmaceutical venture investing or angel investing have the capability to take the same scientific inside approach?
Potter: Some companies have started to look at the science.
Propel(x): Okay. I think that’s probably why Theranos happened the way it did.
Potter: Yes. I agree with you completely. The smart thing to do would be to bring somebody on board to do the analysis for them. But is large pharma doing this? Some, to a degree are taking a look at the science. As I say, the pharmaceutical industry is very traditional. It’s difficult for them to change the way that they approach things. This methodology can be used in acquisitions, collaborations, and to decide which projects to fund in research, development, and clinical.
And people tend to forget that, at the end of this process, there’s a patient who is hoping that someone comes up with something to help them. People need to wake up to that reality. There are many diseases for which there are valuable treatments, and the easy research has been covered. For example, leukemias are very complex with biochemical/genetic issues that are not easy to treat. Because the pathway may not be understood completely, there is a huge difference in whether there will be an effective and successful product or not.
Propel(x): What do you think are some of the most exciting innovations taking place today in the drug discovery space in biopharma today?
Potter: The hot area right now is oncology. The industry finally woke up and realized that oncology is an immune disease, and so we have a lot of people working on immuno-oncology–turning the immune system back on so that it can attack cancer cells. I mentioned the leukemias earlier. We now treat about 90% of them. The remaining 10% are often intractable. Some of the newest technologies, are starting to look as though that 10% barrier can be broken.
These are early days and many of the drugs are decent. It’s not possible for one drug to work well in everybody because we are all different biochemically and genetically. But it is possible to get a more targeted highly effective drug that works in a significant percentage of patients, while you look for effective treatments that suit others. We are sharpening our skill in genetics, and that’s where the answers lie.
However, you still see everyone doing the same thing. For example, there are multiple pathways for targeting cell cycle inhibitors, but right now most labs are looking at the same pathways.
About ten years ago, everybody was looking at apoptosis. Apoptosis is programmed cell death. And they were trying to increase it to target cancer cells. They were not very successful, though. So nowadays, you don’t hear much about it.
However, there’s nothing wrong with apoptosis as a target. Most cancers will be treated by a combination of drugs anyway. I predict that, 5-10 years from now, someone will come back and look at it from a different perspective, and we’ll be right back to apoptosis. But by that time, we’ll have already lost 5-10 years. How many patients will have lost?
Propel(x): So do you see big pharma players leading the way to innovation, or is it the start-ups and individual efforts that will bring the creativity we need?
Potter: Historically, it’s been the startups that have come up with the novel approaches. They are more innovative and imaginative. Unfortunately, that changes with the development of a drug. They start out with a totally novel idea, but it is interesting to watch the development of a small company because after they’ve come up with two or three novel drugs, that’s all they can maintain. They’ve grown larger, they’ve hired for new functions, and in that environment, research is no longer pre- eminent. They have become a pharma company, or they have been absorbed by one. They’re not capable of looking at research in a new or different way. There’s something about the culture. It’s inhibiting. There are a few great companies, that maintain their innovative culture, but that is rare.
Propel(x): But do you worry that, under the current administration with some of the funding constraints that are likely to come, start-ups will face funding difficulties?
Potter: It is terrifying. If you’re a very lucky person and you don’t have any major diseases, this may not occur to you. But if you’re someone who has a progressive or chronic disease, it is very serious.
On top of that, people are competing for the few dollars that are left. Are they going to go for something that is totally new that they can’t explain, or are they going to go for something that they know works? It may not be original, but from that point of view, it’s safe. It’s frightening to think about what they might choose.
Part of the excitement and the value of the pharmaceutical industry is that people take a chance with something completely novel. Does it always work? No. But when it does the impact can be profound. It would be terrible to lose that quality.
Propel(x): Do you feel that spirit change over time, as the company grows?
Potter: It depends on how you look at it. It certainly becomes more successful. It certainly begins earning money. Then there is a request for a second drug, which treats a different mutation. Then a third and fourth drug… We’ve come to understand that the best treatment for cystic fibrosis, for example, is a combination drug.
They still have expertise, but the truth is, the atmosphere is different. It’s different when you work in a pure research environment versus when you’re a pharmaceutical company where you have to get a drug out within a certain period of time. In pharma most of the compounds identified have little or no therapeutic value or are toxic. So it’s a constant race to find a better drug candidate that is not toxic and that does what you want it to do. If you’re a theoretical scientist, then you want to be in a research environment with the excitement of discovery. If you want to see the discovered compound developed into something that works in people, then you want to be on development and clinical side. Both are terribly important, but different personalities usually prefer one or the other.