Asset-centric investment aids drug discovery
Company: Index Ventures
In good times and bad, Big Pharma's innovators are judged on how well they pick winners. Which drug development programs deserve billion-dollar bankrolls and which should be swept aside? Making that call requires a great deal of biochemical know-how and an eye for a compound's potential, Index Ventures Partner Michèle Ollier said. But even the best in the industry have to take a gamble sometimes, and that's when hard-won instinct comes into play.
"This instinct is something you form with time, having seen a number of things and knowing you've been working to understand what's behind each of the successes and failures you have behind you," Ollier told FierceBiotech.
She honed her skills during tenures at Sanofi ($SNY), Bristol-Myers Squibb ($BMY) and Serono, working on drug development and business strategy. Ollier learned the ins and outs of the long, arduous process of taking a drug from proof-of-concept to market, and formed the ability to understand a drug's potential.
However, working for some of the world's largest pharma companies often put drug-development decisions that could affect millions in the hands of corporate bureaucrats, and trusting that model became increasingly difficult, Ollier said. Wanting to focus on innovation and to feel more in control, she decided to make a change. She got a call from a colleague who wanted to create a venture capital team focused on biotech, and starting in 2003, she took on the role of director of life sciences investment at Edmond de Rothschild Investment Partners in Paris. Three years later, Ollier met the team at Index and felt their interests were more aligned with her own.
"Index is a very entrepreneurial culture--that was what was fascinating to me," she said. Now a partner, Ollier focuses on investing in maturing and growing companies with innovative new projects. "Every day, I'm trying to understand what works well, what doesn't work well ... making sure every company can benefit from our experience."
When venture capitalists started investing in biotech, the goal was to create companies like Amgen ($AMGN) and Genentech--sizable outfits with solid infrastructure, lots of staff and, of course, a need for lots of money. "This was the first model we were all following at the beginning ... thinking with lots of products, we could mitigate risk."
But that wasn't ideal for Index, Ollier said. Instead, "we developed the asset-centric model. We put one product in one company--this has had very interesting consequences."
That approach has made for more successful, more cost-effective bets, she said, and being an early-stage investor gives Index a chance to weigh in on its portfolio companies' futures before anything's set in stone, Ollier said. Essentially, if they're not seeing what they want from a program, they can pull the plug before the whole affair gets too costly.
Index started using the asset-centric model about 7 years ago, roughly when Ollier joined. This has "pretty dramatically changed the VC business," she said, and the model has become widespread.
Among Index's success stories is Aegerion ($AEGR), a Cambridge, MA-based biotech. The company's lead program, a drug aimed at LDL cholesterol, ran into tolerability issues in trials on a large patient population. However, one subgroup charted significant benefits, and Index was able to retarget the drug for the orphan disease homozygous familial hypocholesterolemia, setting Aegerion up for a successful $47.5 million IPO in 2010 and FDA approval two years later.
"We learned a lot from this experience," Ollier said. "The success came from finding the right strategy with the right team behind the strategy."
In keeping with the demographics of the industry, those teams tend to skew toward one gender, and at Index, Ollier is the only woman among the company's life sciences partners. Looking to mentor other women who want to succeed in the world's many male-dominated fields, Ollier created a group in Switzerland called Women in Business.
"We write papers for the local newspapers about what we do," she said. "We all come from different professional activities. We have a local radio show. We talk about what's important for women and how we can help other women."
The goal, Ollier said, is for women in venture capital, drug development or any other profession to be judged solely on their talents, skills and experience. But women working toward this ideal still face challenges.
"We should not forget that when we are in business, most of the time, it's a man's world," she said. "And the rules have been set up by men. I'm not saying this is bad--absolutely not. Many things are going well. But I think that we as women could bring something different. But we need to have the mass to bring this something different, which will not conflict or replace but will add something valuable to this world."
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-- Jennifer Levin (email | Twitter)