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Infinity’s New CEO, Veteran Dealmaker, Seeks to Deliver on Company’s Early Promise

Xconomy Boston — 

The story of Infinity Pharmaceuticals can be told through three people. Steve Holtzman got the company started, and raised the money for the company’s proprietary chemistry. Julian Adams brought the focus on cancer drugs. Now it’s up to Adelene Perkins to show that the company’s treatments work, and can be successfully marketed to patients.

At least this was the perspective from Perkins, the new CEO of the Cambridge, MA-based biotech company (NASDAQ: INFI). I sat down with her a few weeks ago at an investing conference in San Francisco to learn more about the situation she’s inheriting at Infinity and where she intends to steer this ship.

Perkins took the top job on Jan. 1, as Holtzman moved upstairs to executive chairman. She had clearly paid her dues before getting the corner office: Perkins was the main architect of a deal in November 2008 with Stamford, CT-based Purdue Pharma and its overseas affiliate, Mundipharma, which basically provided a whopping five years of operating cash.

But things took a turn for the worse in April, as Infinity halted a pivotal clinical trial of its lead cancer drug candidate when it was found to be more toxic at high doses than researchers had anticipated. The company’s stock is still down 28 percent from April 15, when it scrapped that trial of IPI-504. Now Perkins, the veteran dealmaker, has the job of finding a way forward, and to generate some hard clinical trial data that will rekindle enthusiasm for the company. She didn’t give me the impression it’s going to happen in a quarter or two, and it doesn’t involve anything radically different.

“You won’t see Infinity embark on an entirely new course,” Perkins says. “My signature is very much on the course we’ve taken to date.”

Perkins is a familiar face around Boston biotech, but I wanted to hear her tell the story of the path she took to get to this point as CEO of Infinity.

First off, she wasn’t necessarily destined to go into biotech. Perkins got an undergraduate degree in chemical engineering from Villanova University, then worked for a while at General Electric and got an MBA from Harvard Business School. (Interestingly, she never mentioned Harvard during our conversation, referring to it only as “business school.”)

Right out of business school, in 1985, Perkins didn’t know what she wanted to do. “My eyes had been opened to so many careers, I wondered, now where do I go?” she says. So she hedged her bets, and took a consulting job in Boston at Bain & Company, knowing that she’d get exposure to a wide range of clients and industries that would help her make up her mind. She stayed a little more than seven years, splitting her time between pharmaceutical clients, and health care providers.

“I just loved the quality of thinking that I found with my clients in the pharmaceutical space. I felt that’s where I felt at home, and inspired,” Perkins says.

By 1992, Perkins found a full-time job in the industry as one of the early pioneers—Cambridge, MA-based Genetics Institute. It was a fun time to join the biotech industry, she says, and apply a lot of that strategic thinking from business school and consulting into a new and fast changing industry. “We were just beginning to commercialize drugs. So it was a matter of taking an R&D-oriented organization and helping bring those drugs to patients. That was a very exciting phase,” Perkins says.

She found a big new challenge at Genetics Institute, by co-founding and serving as president of a new business unit called DiscoverEase. The vision was to build a library of as many as 5,000 novel genes that carried instructions for certain secreted proteins. While scientists at other companies raced to grab patents on every sequence of the genome that might be useful someday, Genetics Institute took a different approach, with the idea that the proteins that arise from genetic instructions are more important. And Perkins sought to form partnerships with as many companies as possible to co-develop, and co-market drugs based on the gene sequences it had for secreted proteins. She helped form more than 50 partnerships with companies and academic labs. The business unit grew from two people to about 100. It moved into its own office space, and had commercially important functions like quality control—generally a pretty foreign concept to most R&D shops.

During that building phase within Genetics Institute, Perkins got to know Holtzman, who was then the chief business officer of Millennium.

“Steve and I found ourselves on many occasions on the same panel somewhere, and we were competing for absolutely everything,” Perkins says. “Every time I went into a partnership deal, Steve had just left, the door was closing behind him. I was trying to recruit people, and everyone I tried to recruit, Steve was trying to recruit. We were, of course, competing for patent space. The only thing we didn’t compete on, was on our approach. Millennium went with the [gene] sequence-based approach. I didn’t believe that was the right way.”

But these were friendly arguments between her and Holtzman, Perkins says. “We’d debate the relative merit of our approaches. Invariably, we’d share a cab to the airport, and we’d sit next to each other on the flight. In that process, we became great friends,” she says.

By 1997, things had changed at Genetics Insitute, as that company was acquired by Wyeth, the Madison, NJ-based pharmaceutical giant. The idea of being open and collaborative with other companies suddenly didn’t have nearly as much currency with the new bosses. “I found I am not as drawn to big companies and centralized decision making,” Perkins says. “I decided to move on where I could have a smaller, more entrepreneurial environment.”

So she left in 1999 to help start TransForm Pharmaceuticals, a Lexington, MA-based company that eventually was acquired by Johnson & Johnson for $230 million in 2005. The goal there was to develop better chemical formulations of pharmaceuticals. In 2002, after Holtzman called her and asked her to join his new startup at the time, Infinity, she left.

“I was much more inspired by breakthrough science. The formulation piece wasn’t quite as impactful for me,” Perkins says.

Holtzman, who was listed as 55 in last year’s Infinity proxy report, told her as far back as those initial conversations that Infinity was going to be his last startup. The genomics bubble had burst, and the new idea was to use 3-D chemistry techniques to make drugs that were more likely to fit with the rapidly expanding knowledge of genes and protein targets on cells. Chemistry wasn’t keeping up to biology at the time. “It was like the biology of targets was like a lock, and the keys that were being used were like credit cards. They just didn’t fit,” Perkins says. Infinity wanted drugs that “look more like the lock.”

Holtzman put together the strategy, and assembled a team of heavy hitters that included Rick Klausner, the former director of the National Cancer Institute, Eric Lander of MIT, and Tony Evnin of Venrock Associates, Arnold Levine of Rockefeller University, and others.

By 2003, Adams joined the team as chief scientific officer, fresh off his success with the discovery and development of bortezomib (Velcade), now a billion-dollar annual blockbuster for Takeda Pharmaceuticals. With Perkins as the strategist and business development leader, the team was in place. There was also an opportunity for Perkins to advance over time.

“When Steve first began discussing the concept of the company, he was very explicit with our board, that if 10 years in, he hadn’t identified an internal candidate who is a good successor, he will have failed,” Perkins says. “So this is something that has been an explicit goal of his for the past decade. For the last several years we’ve been working on it.”

Perkins took one step in the progression to CEO when she became president in October 2008. A month later, the huge Purdue/Mundipharma deal closed. That transaction—in the midst of financial meltdown—-was crucial for Infinity’s future, especially considering what happened later when IPI-504 failed in its first pivotal trial for gastrointestinal stromal tumors.

The deal has left Infinity unusually flush as a biotech company without any marketed products. The company entered 2010 with $130 million in cash, a commitment from Purdue to provide $150 million in R&D funding over the next two years, plus an optional $50 million line of credit that’s interest free and doesn’t need to be paid back for 10 years. That means that between existing cash, committed R&D funding, and credit, Infinity has access to $330 million to support its internal pipeline and seek out other drugs it can obtain licenses to from other companies, Perkins says. While many other companies are cutting back expenses and laying people off, Infinity has remained steady with 180 employees, and is looking to make a few select hires with commercialization expertise, Perkins says.

The runway may be long, but Infinity is going to need a little extra space to achieve lift-off. The company doesn’t have any drugs in the final phase of clinical trials. Infinity also hasn’t given up on IPI-504—it is currently in a mid-stage clinical trial for non-small cell lung cancer, as well as a breast cancer trial in combination with Roche’s trastuzumab (Herceptin). Results from both of the new IPI-504 studies will be available in 2010, she says, and ought to “embolden” researchers and investors who want to see this drug get on the right track. Perkins is hoping to get some interim data from a Phase I trial of IPI-926, a drug that’s made to block the hedgehog pathway that’s implicated in cancer.

If the data turns out positive, Infinity wants to be sure it has laid down the groundwork to make sure it will translate into a commercial hit. That means getting people on board who know the competitive landscape, how the standards of treatment shift over time, and how to apply that market intelligence to craft clinical trials that will truly set the Infinity drugs apart from the pack. It doesn’t sound like the model of build-it-and-flip-it-quick-to-a-Big Pharma company model.

“We are committed to building a commercial organization, and being fully integrated. I think it’s no accident that there’s no example of any biotech company that’s ever been successful without being fully integrated,” Perkins says. “What are the economics after you have put significant capital at risk in developing a product? You don’t want to leave the decisions for how to commercialize it, and how much priority to put on it, in someone else’s hands. You need to be the champion.”