There are not many people who can say they led one of Europe’s largest biotechs and launched the first approved gene therapy in Europe. Joern Aldag, now CEO at Austrian biotech Hookipa Pharma, has done both.
Aldag got into biotech because he wanted to use his entrepreneurial skills to advance medicine. After 9 years of experience as CEO of Evotec, he put his experience to good use and in 2009 took on the leadership of Dutch gene therapy specialist uniQure. There, he was responsible for the successful EMA approval of Glybera and for launching the Dutch company on the Nasdaq.
In 2016, Aldag took up the reigns at Hookipa, a biotech focusing on developing immunotherapy for both infectious diseases and cancer. Last month, he was yet again behind a successful IPO, raising €75M ($82M).
You have successfully led a number of different biotechs. What did you look for when deciding which companies to work for?
The thing that I’m passionate about is building platform technologies and translating them into companies that can actually develop multiple drugs for unmet medical needs. The current thread across all the companies that I was involved with is the technology platform, which you can leverage into many opportunities. I appreciate that much more than one trick ponies.
You have been involved in the public launch for several companies now. How do you decide when it’s a good time to go public?
The optimal moment is when you get confident about your proof of concept and when you start to think about broadening your pipeline and deploying more cash into more portfolio programs and into later-stage clinical development. That’s one critical feature.
The second critical feature, from my perspective, is that the really valuable biotech companies have taken an asset all the way across the value chain to market. Once you feel confident that you want to fully integrate, you’re going to have to back it up with finance and that requires a public listing because only public markets will give you the kind of funds that you need.
When developing biotech companies, the science is as important as the finance. They’re both two sides of one coin and if you neglect one, you get the receipt for that very quickly. You have to think about financing your company in line with your corporate strategy.
Are there any disadvantages of being publicly listed?
It’s expensive and it’s time consuming. You have to invest a lot of time in investor relations, but that’s a fair price for the advantage of actually being well-funded and having the opportunity to raise more funds whenever your corporate development needs it.
It’s very noticeable that many European biotechs seem focused on listing on Nasdaq, rather than a European stock exchange such as Euronext. Why do you think that is? Do you think it will change?
The Nasdaq is the best source to raise large amounts of money in an IPO and to be able to do sizable follow-ons. I would hope that the European stock exchanges through collaborations, mergers and other means continue to work on strengthening themselves.
If you are a one-product company and you want to raise €20M to reach beyond your next milestone, you can do that in Europe. If your goal is to overcome one of your main milestones and then sell yourself off to pharmaceutical companies, the European exchanges are strong enough for that.
But if you want to list a company that’s early-stage and wants to leverage the technology platform into a broad portfolio of programs and eventually bring drugs to market, you have a more significant cash need. I have been advised by banks and consultants to avoid the European stock exchanges and to better go to the US.
If you could pass on one lesson you learnt from your fundraising experience, what would it be?
Thinking big in terms of funding is important. If your goal is to build a sustainable company, thinking of how to actually get to the end, rather than just thinking of the next step, is most critical.
We are seeing a trend in the venture capital industry where they increasingly look to funding an entire project rather than drip feed money. There is a realization that management time is better spent running a company and executing on the development plan than running after money all the time.
This is my key message: get enough funds to actually be able to execute and not compromise your strategic decisions by the lack of funds.
Another way to raise funds is through partnerships, such as Hookipa’s partnership with Gilead. What do you think makes a good partner and what do you look for when you’re considering possible collaborations?
The partner needs to have a senior sponsor in their organization who has a vested interest in getting to the end of the research and developing collaboration. In the case of Gilead, no one will doubt that Gilead is the best partner for infectious diseases, notably the hepatitis B virus and HIV. Delivering something essential to their core competence and obtaining their core expertise into our projects makes the collaboration extremely valuable.
Do you have any experiences of a bad partner?
I have seen situations in which partnerships were not catering to the core of the pharma partner and which for some reason or other were terminated or didn’t develop the dynamic that you would hope for. You’ll find tons of examples where collaborations at some point in time just linger and disappear because of a lack of interest on the side of the pharma company. I think that being at the core of what that pharma company does is critical. They must have a strategic interest in what you do that makes them really persistent and collaborate to get good results.
You led uniQure when Glybera was approved by the EMA, but the subsequent lack of interest in the drug due to the pricing must have been disappointing. Pricing for gene and cell therapies is obviously quite a thorny issue – what do you think is the right approach?
Generally, the answer is pretty simple. You have to make an assessment of what the value of that treatment is for a patient. I would agree with anyone saying that the risk of the therapy working or not cannot be paid only by the healthcare system. This speaks to a value-based approach that accepts risk sharing in case the therapy doesn’t work. There are different pricing models of this nature that are being discussed in the gene and cell therapy space. These would be my first choice.
What are your biggest management lessons after 20 years of being a CEO?
The biggest lesson is that the people surrounding you are the most important… In the past, I’ve tried to run a ‘tight ship’, and delayed additions to the management team, for example, thinking we’ll be able to just cover that with the existing team. Today more than ever, I realize success is driven by the creativity and the performance of folks who actually have the ability and time to think about what we’re doing. That creates so much more. The challenge is not how to save costs, the challenge is to avoid making the wrong choices and decisions. So, think about ‘how do I get the best people and how then do I fund such a high performance organization?’
The thought process shouldn’t be, ‘how do I avoid a spend or a cost?’ The thought process should be, ‘how do I get the best and fund that?’
Do you think the CEO role is something you have to be born with, or do you think it can be learnt?
You will find good CEOs who learnt to be CEOs. The best CEOs have some personal traits that make them specifically capable. I think there is a certain warm fuzziness and personability that a really good CEO needs that you cannot learn. You have it or you don’t.
How important is mentoring to you?
Increasingly, I appreciate mentors, although I wouldn’t call them that. I have quite a number of people, including my chairman, and some of my key investors, whose advice I increasingly value. Listening to them, rather than just deciding on my own is what I will call ‘mentoring’ actually. They help me challenge my thoughts and my thinking, and allow me to enhance decision-making and the way we’re running the company. In that sense, yes, increasingly I appreciate that input from people. It’s one of the lessons I learnt – to listen more. I appreciate that input from those folks around me.
Do you have any methods or things you do to keep learning every day?
I think you can only be a good CEO if you have this natural tendency of accepting that you have to learn every day. To be a good CEO, you just have to have that. I think it’s almost a character trait.
I read books like The ONE Thing. I also meditate and do yoga. It gets you into a different mode and eliminates some of the tension that as a CEO you almost always have.
What advice would you give yourself if you could go back in time to when you started?
You learn with experience so the advice that I would give myself is to ask more questions and listen more to others. There is so much experience around that you don’t have to reinvent the wheel.
Design via E. Resko