SAN FRANCISCO—The words "J.P. Morgan Healthcare Conference" have come to signify more than the invite-only confab within the Westin St. Francis. Everyone who’s anyone in biotech—as well as everyone else—converges on the city for a week of presentations, cocktail receptions, media interviews and meetings that Drew Levinson, executive vice president and director of media relations at LifeSci Communications, terms “speed dating.”
“We’re not just going into the Westin and doing it. We’re doing it by renting space ourselves in a hotel to do the same types of meetings,” Levinson said. These include meetings with potential investors, partners and journalists—all in hotel rooms with incongruous floating headboards, but no beds.
LifeSci isn’t the only firm that does this. Other communications and investor relations firms do it too, and so do Big Pharmas like Johnson & Johnson and Takeda. Which raises the question: Where do all the orphaned mattresses go?
Celsius CEO Tariq Kassum, M.D., who has attended J.P. Morgan in several capacities since 2003, has two guesses.
“One is that they actually put them under the mattresses in other hotel rooms and they’re hidden by the bed skirt, so nobody actually knows there are two mattresses there,” he said. “My second guess is that they drain the hotel pools and just fill them up with mattresses and say the pool is out of order.”
The Fierce team considered the hotel basement, a cave and an airplane hangar as possible mattress-stashing locations. And Dan Budwick, founder of 1AB Media, figured hotels loaded the mattresses into the freight elevator and onto rental trucks to “basically sit somewhere, in a hotel garage or lot.”
Reality, though, is a little less fanciful.
“I never asked specifically where they went, but I was told they were taken to some storage facility,” said LifeSci’s Levinson.
That storage facility, it turns out, is another hotel room—at least, in the case of the Donatello Hotel, where MacDougall Biomedical Communications has booked rooms for its clients in the past.
Karen Sharma, managing director at MacDougall, discovered the temporary home of the exiled mattresses during her second or third J.P. Morgan.
“We were at the Donatello Hotel and I saw a hotel worker basically hauling mattresses out and lining them up on one of those push carts and then stuffing them into a room that was by the stairwell,” said Sharma, who’s on her eighth J.P. Morgan. “They were literally lining them up one against the other, against the other, against the wall.”
Kassum was incredulous when I disabused him of his swimming pool notions.
“Wait. Those are $1,000-a-night rooms,” he said. “Those are some pampered mattresses!”
That’s right—scores of mattresses are locked away in very expensive rooms, used by no one in a city that has seen a significant spike in people without homes over the past few years and is suffering a shortage of affordable housing.
And rents aren’t the only thing that have risen in San Francisco. At this time of the year, the price of nearly everything jumps, too.
“I have absolutely noticed the steady increase in prices … During J.P. Morgan, hotels are charging extras, like just using the internet in the lobby,” said Katie Engleman, managing director of 1AB, who has been attending J.P. Morgan for eight years.
Budwick, a J.P. Morgan veteran of 17 years, agrees.
“It seems the whole city knows when this meeting is taking place and has found a way to make a premium on our presence. You used to be able to just go into a diner, sit for a meeting over coffee, and get it done,” he said. “Now there's a charge for the table, or a minimum order charge, or an expectation that during lunch hours you will buy lunch!”
Companies who can’t afford—or prefer not to afford—hotel rooms for their meetings have to get creative. When Engleman and Budwick worked at Pure Communications, they would host meetings at a now-defunct speakeasy called Slide.
“It literally had a slide to enter the bar, if you wanted,” Engleman said. “It was a dark, dank venue that felt weird to be in during the day, but it was private, so our clients and reporters loved it.”
Kassum, who had become accustomed to the private rooms that come with working at an investment bank or Big Pharma company, experienced a “lost, wandering feeling” when he moved into private biotech.
“When you’re a private company trying to meet with a venture investor, neither of you has a room and you’re vainly searching for a place to sit down,” he added. “Last year, I met some investors. We didn’t have anywhere to go and had to go to a restaurant and order an obscenely overpriced avocado toast just in order to be able to have an introductory conversation.”
These conversations about costs return every year, with articles calling for the conference to move somewhere cheaper or dissecting the opportunity cost of foregoing J.P. Morgan altogether.
“It’s now driving people away from a meeting once seen as a must-attend,” Budwick said.
“I hope that conversation continues. If you think about a startup drug development company, or even a midstage company, spending $1,000 a night on a hotel room—that’s separate from the cost of getting into a Biotech Showcase or J.P. Morgan. And then there’s the cost for meals, coffee and so on,” Sharma said. “It really adds up and these companies rightfully are weighing the cost.”
But as fed up as attendees are, moving the show will take at least a little coordination.
“In my opinion, unless the premier presenting companies decide to jointly make a statement and no longer attend and foot the bill that comes with making this trip, the show will go on. And as long as that show goes on, everything else will,” Budwick said.
Sara Demy, founder and CEO of biotech events company Demy-Colton, thinks the meetings that happen in hotel rooms and dingy speakeasies can’t beat J.P. Morgan proper and its associated events. Demy’s firm, along with EBD Group, puts on Biotech Showcase, an investor conference that Budwick considers to be the “first real side event conducted.”
"The sheer number of investors, entrepreneurs and executives who descend on San Francisco during this week has grown exponentially over the decades and has now become a citywide activity. Of course, this has evolved to mean that business and connections happen in many places around the city, including receptions, lobbies and cafes,” Demy said. “While productive, the unofficial activities during the week cannot replace the anchor conferences, including Biotech Showcase, where true partnering and presentations take place."
As it looks like J.P. Morgan—the official conference as well as its accompanying activities—is here to stay, we at Fierce turn to the next mattress-related question: If many rooms are taken out of circulation to become conference rooms each year, what is the effect on the supply—and price—of hotel rooms for people to actually sleep in?
With no end in sight to the exorbitantly priced biotech week, we’ll have all year to chase down the answer and hope to deliver it in time for J.P. Morgan 2021.