Episode 103: A Board Member’s Perspective on Biotech Leadership and Strategy

Ever wonder what boards are really looking for in biotech leaders? Well, today we find out with one of the industry's most respected leaders. You're listening to Bio from the Bayou, empowering biotech leaders with the tools, assets, and expertise to improve healthcare outcomes.

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Serving the entire Gulf South, but recorded in the heart of New Orleans. Welcome back to Bio from the Bayou. I'm your host, Dr. Elaine Hamm, the executive and I'm Melissa, a resident at Tulane School of Medicine, and I'm excited to be joined today by Dr. Mark Corgan. And I'm going to have to take a little bit of a vocal warm-up, I think, to read your biography, but I'm going to get into it. So, Mark, I actually know Mark because he serves on my board at Cadenza Bio, and he's had a pretty remarkable career shaping up the biopharma industry. He spent a decade at Pharmacia and Upjohn, where he oversaw the development and registration of Zyvox, Mirapex, Camtostar, Zalatan, and Celebrex, and other successful registrations, and then later led the R&D at Separacorp before becoming the CEO of Zalicus and Karevio Pharma. And then you guided Karevio through its acquisition by Advents. He also co-founded Tremo Pharmaceuticals, which is focused on non-opioid pain treatments. And then along the way, you've served on a couple of other boards like Trevina, And Cubis, which was later acquired by Merck, and Avanir, which was acquired by Atsuka. And throughout your career, you have led the development of multiple new therapies, raised substantial capital in the public markets to bring those medicines forward. And today, you continue to guide the field through your advisory roles at companies like Wave Life Sciences, Astronautix, and Silver Creek Pharmaceuticals, and Serotype Neuromedicine. Oh my gosh, that's quite the career there, Mark.

Thank you very much, Elaine. It's a pleasure to be here and talk to you. Yeah, I guess it's an advanced case of attention deficit disorder that has led me to get involved with as many things as possible. But joking aside, at my core, I'm a clinician and I'm a psychiatrist. And when I first started on the faculty at the University of North Carolina, I was dismayed by the paucity of novel therapeutics, particularly for patients with schizophrenia.

Yeah.

And I was fortunate enough to get involved as the principal investigator of what became Seroquel. And suddenly, as I was giving talks, I would talk about my basic research about early life traumatization and its impact on brain that was measurable in adults. And then I would end with, and I'm also studying a novel therapeutic for schizophrenia. And sure enough, 90% of the questions were not about how the brain's broken, but What can you do to fix it? And I got hooked and I, from then I was a clinical researcher and that's been at my core. And I've been lucky enough to actually get involved in some developed antibiotics. Yeah. As well as a number of products for glaucoma or cancer. And that's been a real privilege.

Well, and we go way back. You've been on my board for antibiotics many years ago, one, a couple failed companies ago. And you're currently on my board for our MS and endometriosis program. Before we talk about all of the boards, I'd like to dive into your career a little bit about what did you find most fulfilling about being on a board?

Well, as somebody once described it, your job as CEO is flying the plane. I'm in the tower saying, watch out, you have an approaching aircraft, drop to 10,000 feet. I have a very clear idea of where the board's responsibilities start and end and where managements start and end. And I think it is incumbent upon boards very simply to have a duty of loyalty and a duty of care. You have got to be loyal to the company, understand that you can't serve on competing boards, and that you have to care. You have to be available, particularly to management, and vet the strategy. I expect CEOs to bring me strategy and Frankly, the mistake boards get into sometimes is they try to fly the plane.

Yeah.

And if you have that little confidence in your CEO, then your move is not to run the company. Your move is to change out the CEO.

Yeah. Yeah, no, absolutely. And we've talked a lot about choosing the right board on this podcast and how to manage boards. I love a good board. I think that they are incredibly valuable to a company. And you have probably managed quite a number of boards yourself. You've been on all sides of the table I'm sure. What is, from your perspective, when you think about whether or not you want to be on a board, what do you look for in a company, and what do you look for in the leadership team?

I start with the strength of the science, and I think it's attracted me to our work together, both on the antibiotics side and now on the ER2 piece. I think my work, for instance, with astronautics is working on a hypothesis that is novel for Alzheimer's disease. That in fact increasing lymphatic flow, which increases 40x turnover during stage 3 sleep, may be in fact the brain flushing toxic proteins. It's the first new idea I've heard about Alzheimer's disease since the name of beta amyloid and tau.

Yeah.

So that's cool to me. Okay, so you got science there. And then, yeah, can the CEO articulate the value proposition? Yeah. And that is critical because you're selling all the time. You are talking to shareholders, you're talking to your board, you're in elevators, and you have to be passionate and believe in it. And then there has to be a degree of egolessness. And I know it's rare in our industry, but frankly, when I look at some of the best examples of CEOs that I've seen, and Mike Bonney from Qubus certainly falls into this category, there's a modesty and humility that he brings that leaves him open to conversations that I think some other CEOs who come in a little bit more full of themselves don't want to hear bad news. I used to have a sign on my door when I was running R&D for Seppakor. I said, bring me the bad news first. I can then do something about it. I can change the direction.

Absolutely.

If you punish bad data, you will, you're setting yourself up for failure.

So yeah, what makes a bad CEO on the other side of this? No, you don't have to name names. That can be saved for later for the outtakes. I will.

I'll name names for the good qualities of people, and we'll keep the bad in aggregate.

How about that? I like that.

I think, I think a bad CEO is one that doesn't listen to advice.

Yeah.

Can't recruit and inspire talent. That is a toughie. Again, on the good example, Mike had Rob Perez as his number 2. Rob could lead any company that I know. Understand what you don't know. An essential member of my team was Grace Skrzynski, who was a CMC savant who could do the chemistry manufacturing controls. It's a required non-sexy part of what we do that's absolutely essential to success. You need to have diversity. And I had one board member I served on say to me, either you believe in this or you don't. Either you believe that actually diversity broadly written Diversity of thought, obviously color, creed, gender, sure. But what I want is different perspectives, and I have to believe in that. That's positive. And so I look for that. And I think I have been actively promoting diversity in most of the organizations that I've been involved in, mainly because I think it's a smart move.

Yeah, both scientifically and financially. I mean, they've done a number of studies on that. And I don't like the perfectly overlaid Venn diagram when I think about, like, who do I want? I want to make sure that I have enough coverage of thought of that because you never know what you're going to face. And if they all think the same or they're all your besties, it doesn't do anybody any good.

Right. No, that's absolutely right. I think that those stimulating environments and what attracts me to boards is I get to work with some really talented people. Look at the people around your table.

Yeah.

And suddenly I can go toe-to-toe with Mike Panzera about design issues in multiple sclerosis trials, and he's going to run circles around me, but I love it. And I think we all leave it with like, wow, I've just had to sharpen my game. And we're working for the right thing. I mean, we are an industry trying to save people's lives or make their lives much better. And it's every day we get to do that. That's an enormous privilege to do. I go to work to try and develop better medicines. What do you want to do with your life as a doc? That's it.

Yeah, absolutely. I mean, that's why we kind of got into it. I think about my hearing loss drug. It's like I get to work on one of the senses. Like, how often do you get to say that in your lifetime?

Right. No, right. And so I think though, one of the other interesting things is, as you asked me a little bit about flaws, is somebody once pulled me aside and this was at Zaleucus. We had an oral atrial fibrillation drug and it was really a better approach to it. But man, the headwinds were terrible against us, particularly from FDA. And so when we began to look at it, I didn't understand why everybody didn't think this was a good idea. And somebody finally whispered in my ear, Mark, it's fine to be a product champion. Don't be a product martyr.

Ooh, yeah.

And I thought, oof, yeah, you're right. Let's take a step back. And I think that's one of the issues for biotechnology companies. It's never a straight line. You always are gonna have to pivot. You think about Wave Biosciences. Wave Biosciences, when I joined, was a CNS company focused on rare diseases. And over time, we realized that our technology which is stereospecific oligonucleotides, actually can be positioned in an mRNA gene editing fashion. Suddenly we're opening up, oh my gosh, gene silencing. The platform has allowed us to pivot, and we've had to retool. We were on the brink of commercialization, and so we had brought in a number of commercial people who all thought they were going to be launching a drug, and then it failed in the phase 3s, and suddenly—

Yeah.

We had a board with commercial people, 2 of whom resigned. One loved it and stayed, and she's been great. But we've had to reinvent ourselves. And I think boards can be helpful with CEOs for that.

Especially that piece of, how do you know when you're about to be a martyr versus a champion?

Well, there are less and less people in the room. You start to notice that. I think you just have to be aware that it's your child. You're going to love it. And that's where boards can be really helpful. And you have to understand, we are going to strike out more than we are going to get hits.

Oh, 1,000%.

Our industry is like the movie industry. It is the closest one to Hollywood. And that is, you're going to sink millions into this. It might work and be a big hit. It might flop. Yeah. You don't know. And you can run a MeToo, you can run another Marvel Comics film, and okay, we've got a slightly better built-in dehistamine, I'm just not that interested in it. But it is the best analogy for our industry. And so early on, understanding whether your drug's got legs or not, and what are the killers for your drug? You know, what, what are problems that when you see, you're like, oh, that's going to be a tough one to work around. Yeah.

Yeah. Well, so as times are tight right now, I mean, it's not a great environment to raise money and move things forward. What strategic priorities should boards focus on when money is tight, but we still have to move the project forward?

That's again, something that I think the job of the board is to think about the intersection between the financing and the data points that'll be value inflection. So boards are serving a number of stakeholders, including shareholders.

Yeah.

And so shareholders are asking me as a board member, Okay, Marc, I've given the money, I've put it in. When does my return actually happen?

Yeah.

And you have to think about with the CEO, okay, the CEO's plan is in 4 years. You've got a problem. You have a news flow problem. You have a financing issue. And so I view partnering with the CEO asset board to start to say, okay, I think This data readout is something we may be able to finance around. And this is why I just went through this discussion this morning with a company that's got an interesting approach, New Targeton, to regional release of ketamine. So—

Oh, cool.

As opposed to soaking the brain in ketamine and waiting till you dissociate for your antidepressant effect, what if we could only release it in specific areas of the cortex?

Yeah.

And it's a cool idea. And I turned around and I said to the CEO and the CSO, please give me an outline of the animal experiments that you're going to do that are going to make me believe you get it into brain, that you can dissociate it regionally, that you are going to mitigate any of those side effects by doing so. And when you give me those 3 animal experiments, I'll tell you how much we can raise around each one of them.

Yeah.

And I think that's the kind of way that boards can help because, again, the CEO is in love with the technology, as rightly he should be. You want them to be champions. But we also have to look out for the investors.

Yeah. And zoom out and go, hey, you need to think about this or we don't have anything.

That's right. That's right. And then another company of mine, Astronautics, We've got this great target that we think will improve H3C, but our lead molecule is got a really narrow therapeutic index. And I've developed sleep hypnotics. And by the way, the FDA is not going to tolerate a narrow therapeutic index for sleep hypnotics. They're just not. And we're not going to be able to prove the long-term downstream anti-amyloid effects for years. So what sounded like a really interesting plan, let's get it approved for sleep in the elderly. Yeah. And then we'll collect the data downstream, is going to be difficult to execute if you're not going to get across the goal line because of a narrow therapeutic index on your lead.

Well, and you're not picking easy projects here, Mark. I mean, you're talking about Alzheimer's, pain, notoriously hard. I mean, these are not easy challenges that you're picking either.

So What are the easy ones again?

Yeah, what are— yeah, I guess that's true. I mean, I think it's like the me-tos. I mean, the more it's easy to— okay, we'll just pivot into a different—

Well, I mean, and look, you know, I love those. Separacore— I took over head of R&D at Separacore. We're an isomer-based company. Isomers are just wonderful, right? Because the racemic mix is approved. You already know you've got the enantiomer.

You know what you're facing.

You already have oodles of safety. And now you just have to find the racemic mix that's got all of the efficacy on one side of the molecule and all the toxicity on the other.

On the other. Yeah.

And you took away the bad half and all you've got is good stuff and it's already been in humans. Yeah. And I remember when I took over as our R&D head there, we, they had just failed at the goal line, an antihistamine, because they didn't mitigate cardiovascular risk. And I took over the eszopiclone program. And eszopiclone was unique because zopiclone, the parent, was a gross drug in Europe, was the number one selling sleep hypnotic, but had not been approved in the United States. So we got the rights to eszopiclone, refreshed IP, lowered the dose, and we were going a million miles an hour. And then I said, I began to be head of R&D. So I was like, okay, I got, what's next? What is your next act exactly?

Yeah.

We had a couple things in the pipeline. We had a couple of respiratory products for Motorola. And I said, we got to start a discovery effort. And literally, I was pilloried. They were like, you're not an isomer guy, are you? And I was like, give me another example. I'll ride this horse all day.

Yeah.

Last time I checked, everybody kind of figured out that the gold rush was over and were claiming all the IP on all the enantiomers.

Yeah.

If you find me one, I'll develop it.

I'll do it.

Yeah. No, so we— it's gotten harder.

It has.

Targets that we're picking are difficult. The commercial model is broken for antibiotics. You and I know that.

Definitely.

Which is a scourge, and we will rue that day.

We will rue that day. Absolutely.

So, yeah, again, I don't think it's straightforward. So, it's hard work. It's just, that's what it is.

Looking back at your career, which board decision or milestone are you most proud of and why?

I, that was the one question you sent me in advance that gave me the most pause. I think the decision to sell Cubist to Merck—

Yeah.

Was the right decision. Very painful. We had built a terrific company and we had figured out that we needed to go into Europe.

Yeah.

And build up our own European infrastructure, had gone through broadening our pipeline with the acquisition of Difucid. We, there were no more antibiotics we could scoop up, and now we were broadening into point of sale. That entire journey of thinking I thought was strategically On a wonderful part of— oh, it was wonderful for me to play a part in that.

Yeah. Well, I have one more question. It has nothing to do with drugs. Something I also go to you for advice on is, what are you drinking and what are you listening to right now?

The California Honey Drops has been kind of on my turntable and kind of a fun band. And I have been— I know this sounds crazy, but I'm refusing to give up summer. And I have this fabulous Willamette Valley Pinot that I've been just enjoying. So that's been my go-to for the summer. I refuse to give it up till Labor Day. And then there's been muscling in on the side has been a white Rhône.

Yeah. Oh yeah, yeah. Delicious, man. I mean, I— to me, there's no season. Everyone's like, rosé is summer. It's not. It's all year round. It's whatever you What do you, whatever you think it is. So, so do you put a little chill on that Pinot then?

I do. I do. Absolutely. I keep it a cave. It's Kip Cave. It's a cave. 52. Yeah. Yeah. No, but it pairs really nicely. It's refreshing. You can have it as an aperitif.

Yeah. Perfect.

Hey, you know, I'm coming to Oklahoma. I'll be in Oklahoma for the first 2 weeks of November.

Well, then you have to come and visit. Maybe we have an actual in-person board meeting.

Oh, that sounds great. I will definitely drive over.

Let's not try to do an Armagnac flight like last time though. So—

No, we will let our better judgments prevail.

Absolutely. Well, Mark, thanks so much for joining us. We really appreciate it, and hopefully we can have you back on one day.

It's always a pleasure to talk to you, Elaine. Thank you so much. Thanks for joining us for Bio from the Bayou, and we hope you'll join us again.

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