Just glance at the name, Seattle Genetics, and you get the drift this is a science-based company. But Seattle Genetics is morphing into something bigger and more valuable, which creates a whole new challenge: How do you maintain an inspired scientific culture from the early days, while living up to the cold market reality to start producing real sales and profits?
Seattle Genetics (NASDAQ: SGEN) has been thinking hard about how to manage this transformation over the past year. Almost 14 years after its founding, the company is now just weeks away from what analysts expect will be a slam-dunk FDA approval of its first marketed product—a drug for rare lymphomas. Expectations are sky-high, as Seattle Genetics stock closed last week above $20 a share, making it worth more than $2.3 billion. To maximize this opportunity, Seattle Genetics has spent months vetting, hiring and training a new commercial team of 100 employees, bringing its total staff up to 450 people. Manufacturing, sales, marketing, supply chain logistics, and insurance reimbursement are just a few of the skills the company has had to add.
It’s hard to overstate how important managing this growth is to Seattle Genetics’ future as a company. If they do it right, this new commercialization crew will help the R&D groups realize their early vision of helping patients and blazing a new trail for “smart bomb” antibody drugs for cancer—a type of drug that has eluded scientists for three decades. But if the new commercial folks botch the product rollout, or engage in unseemly marketing practices to hit their numbers, then Seattle Genetics is asking for trouble. As Josh Boger, the founder and CEO of Vertex Pharmaceuticals said in a speech last week at the Biotechnology Industry Organization’s convention, “it will tear your company apart if commercial has its own set of values. Commercial plans have to be consistent with company values.”
The co-founder and CEO of Seattle Genetics, who is like Boger a scientist by training, has definitely been thinking hard about how to maintain the science-based culture as the company grows up.
“We were very careful to select commercial folks who were very excited and passionate about a company that is led by the scientific discoveries and the clinical data we have,” says Seattle Genetics CEO Clay Siegall. “We wanted sales reps that didn’t just want talking points to sell the product. They want to know how the product works, and what kind of patient populations it works in. They wanted to understand CD30 [the drug’s biological target] and its expression profile. When you have commercial folks asking about underlying science questions, and not just things like, ‘What are the sales targets?’ that’s the kind of person we wanted.”
A little science background is required to see why this matters. Other biotech companies have had a lot of success with targeted therapies over the past decade, making genetically engineered antibodies that specifically zero in on markers on tumor cells, while mostly sparing healthy cells—unlike typical chemotherapy.
Seattle Genetics has gone a step further, by turning genetically engineered antibodies into what amounts to a “smart bomb” against cancer. The company’s technology links the targeting antibody to a potent toxin, which gets unleashed on the tumor.
Most of these efforts to soup-up antibodies have failed over the years, but Seattle Genetics proved it had solved the puzzle last year in a pair of clinical trials. They showed that the new Seattle Genetics drug, brentuximab vedotin (Adcetris) could … Next Page »
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