Catching Up: Convergence, #NEINNO, What's Next in Tech

- The sixth edition of Convergence: The Life Sciences Leaders Forum (an event I help organize) happened last week. Oddly, attendance was up from 2008. Not sure how to explain that. Featured speakers included Genzyme CEO Henri Termeer, Sirtris founder Christoph Westphal, Harvard Pilgrim CEO Charlie Baker, Beth Israel CEO Paul Levy, and cutting edge researchers David Altshuler from the Broad and David Eisenberg from Harvard. Xconomy had some coverage, as did Mass High Tech, and there was a pretty healthy stream of tweets, too.

(Termeer's appearance was followed by a great Sunday Globe story by Stephen Heuser, and then some unfortunate company news on Tuesday, as Genzyme was forced to shut down its Allston plant for decontamination.)

For the first time, we're sharing audio from the event. You can either download the MP3s for later listening, or just click play.

- Christoph Westphal / Henri Termeer session on "The Past, Present & Future of Genzyme." (MP3 file.)



- Alnylam CEO John Maraganore moderates a panel of executives from GlaxoSmithKline, Biogen Idec, Novartis, and Merck on "The New Logic of Partnerships, Licensing Deals, and Collaborations." (MP3 file.)



- Stromedix CEO Michael Gilman talks to David Altshuler of the Broad Institute and David Eisenberg of Harvard Medical School's Osher Research Center about their research. (MP3 file.)



- Jeffrey Krasner interviews Beth Israel Deaconess CEO Paul Levy and Harvard Pilgrim CEO Charlie Baker about the future of the healthcare system. (MP3 file.)

- I've been psyched to see how many people have been tweeting about New England Innovation Month using the tag #neinno. This coming week wraps things up, so do help spread the word -- and try to get out to an event. (We just added a free event called PitchPub to the calendar.)

- For my part, I'll be dropping by XSITE 2009 and EurekaFest on Wednesday and Friday, and moderating/emceeing things at What's Next in Tech on Thursday evening -- which looks like it is attracting a great group of participants (listed on the registration page all the way at the bottom.)

- I'm also adding the Social Media Breakfast series to the list of regular gatherings (at right)... although I find it impossible to figure out from their site when the next one will be held (!)

(In the photo is Genzyme CEO Henri Termeer being interviewed by Sirtris Pharmaceuticals founder Christoph Westphal, at Convergence 2009.)

From the Biotech Business Development Conference

The packed house of attendees at today's Biotech Business Development Conference in Cambridge would seem to be a sign of the industry's health. But everyone here seems to have a long list of worries. (The event is organized by Christoph Westphal, co-founder of Sirtris Pharmaceuticals and now also an exec with GlaxoSmithKline, which acquired Sirtris last spring.)

Biotech CEOs working on new drugs are worried about FOBS: follow-on biologics. The US could soon make it legal for companies to produce generic versions of biological drugs (the biotech industry prefers to call them "biosimilars.") That could cut the profit potential of the very expensive new molecules now in development. John Maraganore, CEO of Alnylam Pharmaceuticals, said the industry needs to adopt "a science-based approach" to persuading legislators and the public that follow-on biologics ought to be tightly regulated, rigorously tested, and carefully evaluated by the FDA. In the past, Maraganore said, "we were obstructionists" about the very idea of follow-on biologics.

There's concern about new regulations that govern how biotech and pharma companies can discuss (or "detail") their products with doctors. "Detail times of 60 to 120 seconds is not much different from the UPS guy making a delivery," said David Pyott, CEO of Allergan. "The only difference is the drug rep is better paid, and sadly, better educated." Pyott predicted that drug companies will have to devote more resources to online education for physicians.

Privately-held biotech companies worry about losing negotiating leverage with bigger partners if it's perceived that they're running short on cash. Duncan Higgons of Archemix suggested that many big pharma companies have created their own lists of distressed little biotech companies, and are planning to do some "bottom-feeding" in this environment, buying them (or certain assets) at a discount. Having enough cash on hand to walk away from a deal is always a good thing, said Steve Bernitz of Concert Pharmaceuticals.

Publicly-traded companies feel like the markets aren't rewarding progress. David Meeker of Genzyme noted that the company has had three new drugs approved in the past three months, and yet the company's stock is down 30 percent.

Venture capitalists are finding it isn't so easy to raise that next fund. Jonathan Fleming of Oxford BioScience Partners told me his firm had put fund-raising "on pause" earlier this year, and described the fund-raising environment as "absolutely horrible." (But he said the firm would be out again talking to prospective limited partners "sooner rather than later.")

Investors and start-ups are worried about the focus on later-stage assets. How will new innovation be supported if everyone is focused only on getting products that are already in Phase III clinical trials across the goal line?

"There's a real failure of the capital markets to fund projects to the point where there's an ROI," said Craig Wheeler of Momenta. "If it continues, we could see real damage to the model that has supported innovation of the last twenty years."

Even Wyc Grousbeck, the Boston Celtics owner who'd previously been a healthcare investor at Highland Capital Partners, had a few problems to gripe about (despite sporting a glittery Celts' championship ring on his right hand), most notably injuries to Rajon Rondo and Kevin Garnett, two key team-members.

ProteoStasis Therapeutics: $45 million first round, video interview with CEO

In late August, the Globe was the first to cover a new Cambridge biotech company, ProteoStasis Therapeutics, as it emerged from stealth mode and announced a first round of financing of $45 million, from firms like HealthCare Ventures, NEA, Fidelity BioSciences, Genzyme and Novartis.

Here's the video... an interview with ProteoStasis CEO David Pendergast:



And here's the official press release, and some coverage of the company from BioWorld.

Boston's Biotech Tycoon

If you want to understand the story behind one of Boston's biggest biotech success stories, Genzyme Corp., Boston Magazine offers this great profile of CEO Henri Termeer, by Geoff Gagnon.

A few months ago, I was talking with some biotech execs who observed that there has never been an obvious #2 executive at Genzyme to succeed Termeer, who is 62. (Several possible successors have come and gone.)

But Gagnon's article contains an interesting detail: Termeer's mom is still alive, in Holland, at age 93, offering him advice. So succession may not exactly be a near-term issue for Genzyme.

Gagnon writes:

At 93, [Mrs. Termeer] still keeps a close eye on her son, and on his company. (She's become a frequent visitor and a sort of mascot at Genzyme's plant in Belgium, not far from where she lives.) The two speak at least once a week and the conversation is rarely laden with idle pleasantries. Mrs. Termeer has a point when she calls, and she tends to get right to it. The impulse is the same when the family gathers for its annual fall reunion along the Dutch coast, in the province of Zeeland. Tradition dictates that the Termeers each rise at the table to regale the clan with a little speech. Without fail, the matriarch's chats are the most, well, weighty. "We all cringe a little when she speaks," Termeer says. "There's usually a big moral angle to it. She's quite serious."

So Termeer wasn't terribly surprised by the call he received a few years back. His mom sounded agitated. She had read about Dutch patients who were relying on free infusions of an experimental precursor to Myozyme to treat their Pompe disease, a rare disorder that shrinks sufferers' muscles, eventually crippling their heart and lungs. The news suggested that Genzyme had plans to stop the program. These were Termeer's countrymen, and such apparent callousness was red meat for the Dutch politicians who denounced him in parliament. "She wanted answers. She wanted to know what I was going to do," Termeer says.

Understanding Yesterday's Millennium Pharma Deal

The acquisition yesterday of Millennium Pharmaceuticals by a Japanese firm for $8.8 billion is a big deal -- the biggest ever in the Massachusetts biotech industry.

The Globe's Jeff Krasner has some really solid analysis of Millennium's saga, which began with a lot of lofty predictions about the power of genomic information. Krasner writes:

Nobody did more to raise those unrealistic expectations than Mark J. Levin, Millennium's cofounder and longtime chief executive. In December 2001, he told Technology Review that Millennium would use genomics to become wildly successful. He said: "Over the next five to 10 years, our goal is to become a company that's leading the world in personalized medicines, a company that is leading the world in productivity, a company with a value of over $100 billion, a company that has five to 10 products on the market that are making a big difference in people's lives, a company with the strongest pipeline in the entire industry."

But beyond building lavish headquarters and striking licensing deals worth hundreds of millions of dollars to Millennium, the company didn't produce. Its two cancer-fighting drugs, Campath and Velcade, came about the old-fashioned way: Millennium bought the smaller companies that developed the drugs. Millennium has since sold its rights to Campath to Genzyme Corp.

In a column from last August, I talked about Millennium as a font of big picture, deal-making CEOs for smaller biotechs, including Alnylam, Infinity, and Tempo.

Sunday's Globe column: Building new pillars in the Bay State

I'm saying it: we need a new generation of pillar companies here in Massachusetts, and the wider New England region.

Sunday's Globe column explores what we need to do to start thinking bigger. From the column:

I understand the argument that big acquisitions, like September's $430 million deal to sell Waltham-based Adnexus Therapeutics to Bristol Myers-Squibb Co., return profits to venture capitalists they can in turn invest in new start-ups and allow newly wealthy entrepreneurs to go off and try something else - maybe even a riskier idea.

But we also need to build the next generation of "pillar companies" here - companies like EMC Corp., Genzyme Corp., Boston Scientific Corp., Hologic Inc., and Nuance Communications Inc.

These companies employ hundreds or thousands of people. They're acquirers, not acquirees. They lead industries, set the agenda, and attract the attention of media and Wall Street analysts. Smaller companies cluster around them.

Right now, acknowledges Steve O'Leary, an investment banker with Jeffries Broadview, New England "is a net sellers market, as opposed to a net buyers market." O'Leary, who earns a living by selling tech companies, says, "I'd like to see more of a food chain, from the big companies on down."

I wrote about this topic back in January, as well, and moderated a salon called 'Thinking Big' late in November.

Which Three Boston Notables (and One Company) Will Be at the White House This Friday?

President Bush hands out the National Medals of Science and Technology this Friday at the White House.

Who's on the list from our part of the world?

1. Chuck Vest, former president of MIT
2. Bob Langer, head of MIT's Langer Lab and founder of numerous biotech and med device companies, among them Alkermes, Alnylam, Pervasis, and MicroCHIPs
3. Daniel Kleppner, an MIT physicist whose work led to ultra-accurate atomic clocks and the global positioning system
4, Genzyme Corporation.

A Globe blog post on the winners is here.