What’s Material in ESG for Biopharma Firms?

Key Points

Gilead Sciences has long focused on sustainability but recognized a more robust framework was needed.  Based on a materiality assessment, Gilead’s ESG strategy today focuses first on drug access and pricing, while also addressing D&I and climate change. RBC Capital Markets’ Brian Abrahams, Co-Head of Biotechnology Equity Research, caught up with Gilead’s team of ESG leads at RBC’s Global ESG Conference to learn more about its strong commitment to ESG and what’s material in ESG for biopharma companies.

Stakeholders drive ESG goals

Companies in every industry are increasingly recognizing that stakeholders have varied targets and issues when it comes to ESG. At Gilead, the investor community is highly important, and most of them have an ESG analyst that comes to meetings and wants an outline of current and future goals for the firm. But the employees are the stakeholders that are most committed, they want to work at a company that’s doing the right thing.

“The stakeholders that engage with us most frequently on these kinds of goals and ESG issues are primarily employees,” says Brett Pletcher, Executive Vice President of Corporate Affairs and General Counsel at Gilead.

“We’ve got 17 million people out there in the world who are taking a Gilead drug every day in the developing world for HIV and people are very, very proud of that.”

Brett Pletcher, Executive Vice President of Corporate Affairs and General Counsel, Gilead Sciences, Inc.

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Materiality for biopharmas

For a major biopharma firm, ESG looks a little different than it does in other industries. After building upon initiatives on goals, data collection and disclosure over five years, Gilead decided last year to run a full materiality assessment, which came up with five key elements for its strategy. These were, in order of importance: (1) drug access, pricing, and affordability; (2) R&D (3); inclusion & diversity; (4) attracting talent to drive innovation; and (5) climate change.

“Drug pricing is something that we could spend a lot of time talking about, and access has a lot of different pieces to it from the pricing set by the drug company to the copay requirements set by the insurance companies,” says Brett Pletcher.

This isn’t just an issue in the developing world, but in the developed world also, where Gilead has a number of programs to help patients access its medicines.

“We never want a patient to be unable to access a medication because of cost. And so, for any patient who is uninsured or has certain levels of income, we have a free drug program where that patient can give us a call and we can provide that drug free of charge,” explains Brett.

“We never want a patient to be unable to access a medication because of cost. And so, for any patient who is uninsured or has certain levels of income, we have a free drug program where that patient can give us a call and we can provide that drug free of charge.”

Brett Pletcher, Executive Vice President of Corporate Affairs and General Counsel, Gilead Sciences, Inc.

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“We also have copay assistance programs where if patients can’t afford to copay set by their insurance company we can assist them to some extent. There are some programs that we’re not allowed to provide any assistance with, so there are also charitable foundations out there to which we’ll give money.”

How climate change affects strategy

While climate doesn’t figure as high up in priorities as in other industries, it’s still an important piece of ESG strategy at Gilead. The company has a target to reduce operational greenhouse gas emissions by 25% from 2016 levels by 2025, and it’s well on its way to achieving that already. Gilead has managed to make reductions of 44% so far, despite 14% operational growth, partially aided by sustainable lab practices.

“[We are] trying to drive this notion of intelligent laboratories, where levels of automation can significantly impact consistency in the way you use water and energy, for example, during cleaning regimes etc. So using technology and automation to drive some degree of consistency in energy and resource usage is a huge part of our focus,” says Joydeep Ganguly, SVP of Corporate Operations.

ESG makes sense

Companies and investors are more aware today that ESG makes a tangible difference to their bottom line. ESG investments outperformed over 2020 and companies that embrace sustainable strategies have also reported material gains. For Gilead, it’s about being thoughtful in its strategy.

“Our board is acutely aware of the contribution that ESG makes to Gilead’s overall success. And actually, it’s a point I can’t make strongly enough, we see this as a certain degree of causality that companies that do invest in ESG are actually companies that do well, and from our perspective we do see a very strong link between our ESG ethos and our results,” says Joydeep Ganguly.

“Our board is acutely aware of the contribution that ESG makes to Gilead’s overall success. ”

Joydeep Ganguly, SVP of Corporate Operations, Gilead Sciences, Inc.

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“That said, we are very thoughtful about the investments we make. We believe they need to be directly correlated to things like climate change and in line with our strategy. But we don’t see this as being mutually exclusive… It’s a combination of being thoughtful, being very strategic, and investing heavily in planning.”

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Required Disclosures and Disclaimers

Featured Guests:

Brett Pletcher
Executive Vice President, Corporate Affairs and General Counsel at Gilead Sciences

Brett Pletcher joined Gilead over fifteen years ago and currently leads the government affairs and policy, public affairs, and legal organizations. In his role, he oversees the company’s work to shape health policy and communicate the company’s perspective across external audiences. As General Counsel, he is also responsible for all of the company’s legal functions, including intellectual property, litigation and compliance efforts associated with the promotion of Gilead’s products.

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Korab Zuka
Vice President, Public Affairs at Gilead Sciences

Korab Zuka oversees Gilead’s efforts across therapeutic areas working to reduce health disparities, expand access to health services, advance education, and support local communities.  Prior to joining Gilead, Korab served as Vice President, External Relations and Patient Services at Patient Access Network Foundation where he led PAN’s fundraising strategy and patient services. Korab also spent 5 years working for the United Nations/OSCE in Kosovo, where he supported several projects focused on promoting education for underserved youth in Kosovo, and also founded and served as Executive Director for the Center for Social Emancipation, a non-profit organization that sought to promote human rights for marginalized communities in Kosovo.

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Joydeep Ganguly
Senior Vice President, Corporate Operations at Gilead Sciences

Joydeep Ganguly leads several strategic functions at Gilead, including corporate engineering and operations, infrastructure and capital planning, sustainability, risk management and resilience, and global procurement. Prior to Gilead, Joydeep spent 10 years at Biogen, where he held executive positions in technical operations, manufacturing and supply chain functions. He currently serves on the Board of Directors for the Bay Area Council, Science from Scientists and North Carolina State University’s Supply Chain Research Consortium. Recognized by ISPE with the Roger Sherwood article of the year, Joydeep has published extensively in areas of bioprocess optimization, supply chain transformation and advanced process control. He was recently recognized by the National Diversity Council as a top 50 diverse leader in California.