Asked & Answered

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In this issue of Biotechnology Focus, we introduce a new section to the magazine that will be a regular feature in future Executive Editions. Posing some of the most pressing questions facing biotechnology companies today, this Q&A section aims to highlight companies’ own responses and reactions, with the goal of sharing experience and expertise among those in the industry. This edition’s inaugural question was formulated for Biotechnology Focus by Jim Hatch, PhD, a professor of Finance and director of the Ivey MBA Biotechnology stream at the Richard Ivey School of Business (London, ON).

As a market, Canada is relatively new to the biotechnology sphere, and a large pool of experienced management does not exist as it does in some other markets.

With this in mind, do you feel there is a shortage of management in Canada? If so, what approaches are your company taking to address the issue of acquiring experienced management?

By Joanne E. Harack, PhD
Vice-president of Human Resources and Corporate Communications Affinium Pharmaceuticals Inc.

I think we sometimes cast this issue in unnecessarily binary terms: science versus management, training versus recruitment, and so on. Obviously, Canada has some success stories, and therefore its share of talented managers. In general, though, the pool of managerial candidates in Canada is objectively smaller than those found in U.S. biotechnology hubs such as the San Francisco Bay area or Boston/Cambridge. This is particularly true for emerging companies in the race to commercialization, which require different managerial skills than they needed as startup companies.

Affinium Pharmaceuticals Inc. (Toronto, ON) is a structure-guided, drug-discovery company, so my answer to the question is in that context. By “experienced management,” I mean people with a proven history of delivering results themselves, and with the ability to inspire others to innovate for success. Success is defined as job growth, added shareholder value and investor confidence — via drugs that will help people to live healthier lives — in the context of a highly complex and competitive environment. This kind of talent is characterized by a unique combination of patience and urgency based upon experience: patience because drug discovery is complex, and urgency because the competitive landscape demands speed.

At Affinium, our strategy has been to recruit very carefully, and to recruit globally. Our senior management team is made up of both Canadian and American executives, and they all have significant track records in growing companies and bringing drugs to the clinic. From the very beginning, our scientific founders envisioned a company that would be competitive globally, and they recognized the urgency to recruit experienced management early. We work with recruiters who have demonstrated understanding of our sector. The senior team, in turn, is proud of having recruited experienced scientific middle managers from around the world, including expatriate Canadians with drug discovery expertise that is now being applied in Canada.

At the same time, we are very conscious of our opportunity to develop the next generation of managers. So, for example, we use bimonthly, all-company meetings as vehicles for shared learning about the industry: the science, the business, the economics, and the art of putting them all together.

By Linda Lupini
Senior vice-president of Human Resources and Administration QLT Inc.

Without a doubt, the Canadian biotechnology industry’s growth has exceeded our ability to grow and attract experienced management.

The longer-standing companies in this industry in Canada are branch plants of pharmaceutical companies whose head office is usually in the U.S. There is a small pool of management personnel at those plants, but not really senior management across disciplines (head of Regulatory Affairs, head of Research and Development, chief operating officer, etc.), which is what you would normally find in a head-office environment. Further, the experience level, even when some of these positions exist in Canada, is often not “deep” enough. Heads of Regulatory Affairs need to have presented at Food and Drug Administration advisory panels. Heads of Research and Development need to have run Phase III clinical trials around the world and need to understand how to expedite drug development.

Essentially, what is needed in Canada is a pool of managers who have led a company through defined maturity stages. For example, there are entrepreneurial types in Canada, usually founders and world-class scientists who can start companies and develop ideas to some commercial level. However, at the point when a company is taken public, becomes profitable and/or is assessed on earnings, there is really a limited number of people who can run it in Canada.

QLT Inc. (Vancouver, BC), along with some other biotechnology companies in Canada, has addressed this issue by trying, wherever possible, to hire experienced managers and leaders from locations where the industry is more mature. The U.S. and Europe are two examples of these locations. Interestingly, building a critical mass of talented and experienced management does take on a life of its own once stimulated. For example, a CEO from the U.S. will often bring in other experienced personnel through networking. These people in turn recruit others.

At the same time, QLT is growing its own management through mentoring programs and leadership activities. The BC Biotech Board and Biotech CEO groups serve as forums for exchanges of expertise and information and, of course, shared experience. There are several very experienced CEOs now on the Board from the U.S. who share much of their knowledge with others. In addition, QLT has strongly supported the initiation of the Biotechnology MBA program at Simon Fraser University (Burnaby, BC) and has allowed two executives from QLT to serve on the advisory board to ensure the curriculum is focused on the gaps in management knowledge and experience.