4:15 PM
Oct 26, 2018
 |  BioCentury  |  Product Development

R&D merry-go-round

What R&D leadership swapping means for pharma companies

An exodus of pharma R&D leaders to small biotechs and start-ups over the last year reflects a new phase in the ecosystem’s churn of talent. But it’s not all loss for the pharmas. The transition is expected to help them access innovation by improving the quality and number of in-licensing opportunities.

This year, 25 senior leaders in R&D from 17 different pharma companies have departed to take CEO or other senior management positions at smaller biotechs. Eighteen of those execs joined companies that were founded or raised a series A round in the last three years.

In contrast, only one has gone in the reverse direction. Hal Barron left biotech Calico Life Sciences LLC, where he was President of R&D, to join GlaxoSmithKline plc in January as CSO and President, R&D. Barron had held the Calico position since 2013; previously he headed up global product development at Roche.

The pattern reverses the trend during the last two decades when the flow of R&D leaders more commonly went into pharmas from biotechs or academia.

The change is largely due to the rich funding environment for new companies, which provides attractive resources for translating new technologies into products and delving back into the science.

Pharma leaders who are making the leap told BioCentury the hands-on access to research was a key part of the decision.

“In pharma, you rise up. You have the opportunity to take on greater and greater leadership roles and build organizations; those are wonderful opportunities. But it also starts to take you further and further away from the actual studies, the science and the direct interactions with the treating physicians,” Daniel Chen told BioCentury.

Chen was previously VP and global head of cancer immunotherapy development at the Genentech Inc. unit of Roche. In August he joined IGM Biosciences Inc. as CMO.

The moves provide biotechs with leaders who have experience bringing compounds from preclinical development to market, understand the regulatory environment, and can convey the value of their programs to investors.

“Scientific discovery isn’t necessarily accelerating, but the relevance of that to human disease is changing.”

Andrew Plump, Takeda

Pharma R&D leaders contacted by BioCentury saw the full half of the glass; they expect the shift of experience to biotechs will result in fewer missteps by the smaller companies, faster delivery of candidates, and more robust clinical programs than has been the case historically.

The churn is healthy for the ecosystem, the R&D leaders argue, because large companies will have a better supply of programs to in-license.

Still, most agreed pharmas could face a shortage of fresh blood at the top. Of the 25 slots the pharma-to-biotech transitions opened up, three were replaced by pharma-to-pharma moves, two were filled via internal promotions, and one was replaced from FDA. Three of the positions weren’t filled at all because they were in therapeutic areas the pharma companies jettisoned. Replacements for the other 16 have not been disclosed.

Figure: Pharma’s R&D efflux

A steady stream of VP or higher-level R&D leaders at pharmas have left for biotechs this year, reversing the trend of the last two decades. BioCentury identified at least 25 senior R&D executives who, since January 2018, have made the jump to senior positions such as CMO, Head of R&D or CEO at established biotechs or start-ups. At least six of the openings created at the pharmas were filled by executives from other...

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