Brent Saunders - Actavis

Blazing the "growth pharma" trail

Name: Brent Saunders
Title: CEO, Actavis

Actavis CEO Brent Saunders didn't spend long in pharma's chief exec ranks before a $65 billion deal for Allergan ($AGN) landed him at the head of a top-10 global company.

"It was never our intent to do the Allergan deal," he told FiercePharma of the late-2014 pickup that's redrawing the pharma map. "It wasn't in our strategic plan or anything like that. It was a once-in-a-lifetime situation. It was a company that shouldn't have been for sale."

But now that he's there, Saunders is gearing up to do things quite a bit differently--especially for a company of Actavis' size. To start, he's eschewing the "Big Pharma" label for a new descriptor--"growth pharma"--that differentiates Actavis ($ACT) from the slow-growth giants in the field.

And just what does being a "growth pharma" entail? A few key characteristics, including highly efficient SG&A spending, sustainable commercial franchises with extended IP protection, and a strong global commercial footprint, the company says.

"We've really tried to get leverage out of our commercial structure by focusing on line calls and innovation versus just blockbuster programs or products, and so that helps create a portfolio approach to selling and makes you more relevant to your customer base," he says. It also creates a "ladder portfolio" of products and patent losses to keep those patent cliffs not so steep.

And then, there's Actavis' unique approach to innovation--and the "ecosystem" of innovation. "It's a continuum," Saunders says. The company isn't going to shell out on drug discovery in areas where it doesn't think it has a comparable advantage--and where there's not a great chance of netting a return on its investment. "It's not a one-size-fits-all model. It's a very thoughtful, deliberate approach to focusing on driving R&D and innovation and investing in our commercial capabilities," he said.

Saunders is also trying to cultivate a "nimble, fast-paced" environment to set Actavis apart from sluggish companies out there. To do that, he's keeping a "very flat" structure without a lot of layers of management, as well as fostering a culture of individual accountability with a "fast, fail-and-learn approach."

Taking its own path makes sense for a company like Actavis, a brand-generic hybrid that's "a new sort of beast," as Saunders puts it. While other drugmakers out there house both brands and generics under the same roof, Saunders is working to run the company as one team rather than managing the businesses separately. And the way he sees it, doing so leads to some "really powerful advantages for us," he said.

So as Saunders embarks on creating a next-generation pharma company, does he expect his rivals to follow suit--especially where drug discovery is concerned?

"I do think that as the industry continues to consolidate and look for ways to streamline and be more focused, they're going to have to be more careful about how they spend their money," he said. "If they truly are best at what they're doing, they should keep doing it. And if they're running second or third place to startups and academics, maybe they should rethink what they're doing."

-- Carly Helfand (email | Twitter)

For more:
Want Actavis? Prepare to pay up, CEO says
Actavis has an eye on more deals, for 'couple billion dollars' or so
Can Actavis deliver a promised $6B boost from this pipeline?
AstraZeneca continues its respiratory land grab with $600M-plus Actavis deal

Brent Saunders - Actavis
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