Scarcity breeds innovation
The funding environment for the biotech industry may be painful. But industry veteran Dr Ted Love, former CEO of Global Blood Therapies (GBT), remains upbeat.
“I recognize that it’s been tough for biotech over the last few years, but I’m extremely optimistic about the future,” he says. “When biotech is struggling, that’s really when you want to invest.”
He believes that investors fund the best ideas when capital is scarce, which leads to better innovation. “We are most selective during that period, and we get the biggest returns after that period of lull,” he adds. “I think an explosion is just around the corner for biotech.”
Hone your story
Love, whose company was acquired by Pfizer in 2022 in a $5.4bn deal, acknowledges the “rocky water” of the Federal Trade Commission’s attempts to block Amgen’s acquisition of Horizon Therapeutics. Nevertheless, he foresees a burst of M&A activity.
“Innovation is driven by the small companies, but access to these therapies can be driven by the big companies. So M&A is a very natural process,” he adds.
“What I say to people all the time is, great companies are acquired, they’re not sold. At GBT we focused on building a great company. And when people recognized we had built a great company, there was interest in acquiring it.”
He urges CEOs to hone a compelling narrative. “GBT was very focused on explaining to investors that sickle cell disease is a complicated disease on the surface, but fundamentally there’s a problem of hemoglobin clumping together – and we were making therapies which blocked that process.
“If you can explain to investors how your science is attacking the root cause of a disease, that’s very exciting. That gets investors excited, it gets patients excited. And if the science is real, it should get everyone excited.”
Talent is key
Love believes another of the key factors in GBT’s success was its ability to attract the right people. Alongside funding, this remains the biggest challenge for CEOs, he says.
“I think the companies that will be most successful will be those who get the capital to drive their innovation, who have the capacity to focus on the right issues that really drive process – and then finally, being able to assemble the talent,” he concludes. “It’s all about people in the end.”
