International Entrepreneurship: Lessons from the Road - ACS

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International Entrepreneurship: Lessons from the Road Sundeep Dugar*,1 and Abhinav Dhandia2 1Sphaera

Pharma Pte. Ltd., 8 Temasek Boulevard, #22-03 Suntec Tower 3, Singapore 038988 2Sphaera Pharma Pvt. Ltd. Plot No. 32, Sector 5, IMT Manesar, Haryana 122051, India *Email: [email protected].

Entrepreneurship is a mix of attitude, talent and perseverance. Successful new ventures are planned, created, and managed. Every venture demands three types of resources – time, people and capital. Conventional R&D model with the big pharma has relied on a blockbuster strategy – the need for a major breakthrough in drug discovery and development capable of delivering billion dollar revenues. The new age R&D model needs to be scalable with most of the costs being variable and only a small fixed cost and capacity structure. A successful entrepreneur on the international front needs creative out-of-the-box thinking, attention to compliance, with the understanding that the concepts of innovation and entrepreneurship need to be disruptive.

Introduction Sundeep Dugar has been in the pharma R&D space for 27 years with tenures at Schering-Plough, Bristol Myers Squibb, Scios Inc and Johnson & Johnson (J&J). He is a co-inventor for two drugs on the market - Zetia and Vytorin. At Scios Inc, he established the small molecule discovery program which contributed about $900M to the $2.4B acquisition value. His responsibilities included managing the discovery and development activities and establishing novel research programs. He was also a part of the team at J&J that evaluated and licensed Xarelto® from

© 2016 American Chemical Society Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.


Bayer. It had a first year sales of €322 million for Bayer and $239 million for J&J. The 2018 sales figures for Xarelto is estimated at $3.68 billion. He started his career as an entrepreneur with the establishment of Advandtium Pharma, a full service clinical research organization (CRO) that he exited through a stake sale to Sequoia Capital 18 months later. He then subsequently founded Sphaera Pharma to establish a totally new model of drug discovery and development. In this article he and his colleague Abhinav Dhandia share with the readers their perspectives on entrepreneurship and their experience with pharma business.

Entrepreneurship A key component of entrepreneurship and entrepreneurs is innovation, particularly disruptive innovation. Entrepreneurship is a synergistic mix of attitude, talent and perseverance. Entrepreneurs have to take initiative, create access to resources, be autonomous and risk-taking. Entrepreneurs that introduce innovation are capable of change and often do change or create entire industries, and disrupt the business fundamentals that exist. Autonomy here has to be differentiated from an autocratic style of management. While successful in some cases, organizations that are built on autocratic leaders tend to be ‘one-man shows’ and face difficulties in change management at the top. Creating and retaining a motivated team is essential for the success of the enterprise and the achievement of the overall vision. The access to and availability of resources (human and monetary) need to be adequate and appropriate. When juxtaposed on a plan of action, a dynamic road map can turn the innovation and concept to more than just a good idea and will advance it to a path of success. Successful entrepreneurs inherently challenge the status quo and push their own boundaries. The breadth of thought and confidence in one’s abilities is reflective in their demeanor. Upon observation, the common features of entrepreneurs include being an abundant thinker, “a learn as you go” approach, a frugal lifestyle, a problem solver, hustler, and an ability to listen to others, but decide for yourself. In summary entrepreneurs are • • • • • • • •

Assertive Self-motivated, efficient, diligent Capable of planning and following plans Perceptive, willing to take risks Committed Creative Toleratant of ambiguous situations or uncertainty Able to find capital, team members, and/or markets

118 Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.


The Process Successful new ventures do not appear magically out of the swirl of the market - they are planned, created, and managed. Often enough in successful ventures, we do not get to see the many years of hard work that has gone by. What appears to be overnight successes are rarely so. Three very general stages in the process of creating a venture are 1) Planning stage where ideas are generated, the innovation and opportunity are identified, and the business idea begins to take shape; 2) Implementation stage where necessary resources, both human and financial, are acquired to start the venture and the business actually starts; and 3) Management stage when the business venture is operational and is shepherded to the desired goals. Resources Every venture demands three types of resources – Time, People and Capital. Of these, the only component that is internal to an entrepreneur is time. A successful venture demands dedicated, passionate and unhindered time commitment from its leadership. Intuitive and successful entrepreneurs know the importance of a motivated and well balanced team and go out of their way to hire and retain the best available talent. Strong teams build strong businesses. The most challenging component of the triad is capital, particularly financial capital. Oftentimes great ideas fail to become great businesses because of the lack of capital. Team and Teamwork: A Critical Component Most successful entrepreneurs know and understand the criticality of building the right team to instill and promote teamwork - where the team enhances and adds value irrespective of authority. The failure and success of the team is perceived by the members as personal failure, and success and responsibility becomes a shared responsibility. Group welfare becomes the prime motivator. Teams are built; they don’t just happen. They rely partly on mentorship within the team, partly on the leadership whose critical thinking and analysis of the roles and responsibilities define the expectations of the team, and partly on the team and their positive attitudes, trust, and confidence. A successful team is akin to a symphony, where the members create harmony through team work, coordination, and mutual understanding of a musical score. It is also akin to a wedding or a drug discovery process, where many team members and events have to be synchronous for a successful outcome.

Pharma R&D Models Conventional R&D Model The conventional R&D model with the big pharma has relied on a blockbuster strategy – the need for a major breakthrough in drug discovery and development 119 Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.


capable of delivering billion-dollar revenues. The R&D budgets in big pharma kept increasing in spite of repeated failures. In an effort to build massive internal capabilities, big pharma companies tended to become monolithic organizations. Indeed, the lack of results suggests that this approach to small molecule R&D may be obsolete. Hence there is a need to create new models and paradigms for improved outcomes. To address this problem, many companies started placing more emphasis on outsourcing significant portions of R&D, manufacturing and other corporate processes, and rely extensively on partnerships and alliances. This was primarily driven by an intent to stem the increase in cost of R&D. This led to models of R&D stuck in cost arbitrage and the task/problem conundrum. It is far more productive to outsource a task, as the processes to complete the task have been identified and hence there is only the requirement of execution. Outsourcing problem solving presents a different issue – who is responsible for solving the problem. Contract research organizations often do not have the capability and they were not built to do so. Furthermore, problem solving is an unpredictable activity and hence of not much appeal to contract research organizations. Evolving R&D Model The new age R&D model needs to be scalable with most of the costs being variable, and only a small fixed cost and capacity structure. This is critical to provide the flexibility and agility that a company needs to address the complexities and cyclical ups and downs of drug discovery and development. Flexible and risk managed entities associated through a R&D network can provide such an option. These entities can be strengthened or leaned out, depending on the requirement of the discovery and development pathway. Smaller companies can be organized for rapid adaptation to future changes in the industry’s environment. Most modern-day business environments are dynamic; the pharmaceutical sector, being heavily innovation-dependent, leads the pack. New players have the potential to win the competitive battle in the emerging landscape before the existing players can adapt. Pharma R&D thrives in an ecosystem that is networked and collaborative between the biotech companies and academia, providing access to disease knowledge communities. Hence there was a need to create an organization that would be geared to deal with a more complex business model with a focus on the translational domain of drug discovery and development. There was a clear opportunity in the late discovery to early clinical space. In pharma R&D, selecting the right research program is key. This selection criterion is based on multiple factors including validation in animal and/or in human models, synchronization of scientific merits and commercialization opportunity, and regulatory pathway to approval. Furthermore, research programs are supported by leadership with a proven track record and an eminent Scientific Advisory Board with diverse therapeutic area background. The organization has to be structured to capitalize on scientific opportunities and remains agnostic to therapeutic area and markets. 120 Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.


Sphaera Pharma Sphaera Pharma has been founded with these tenets in mind and as guiding principles. The objective is to leverage global resources through a network into one organization with the capital efficiency of countries like India, corporate structure benefits of Singapore, and the technical expertise and experience of mature biotech markets like the US. Sphaera Pharma was incorporated in March 2008 with its global headquarters in Singapore and research presence in India and the US. It has established a unique model that can deliver new therapies with managed cost and risk, a business strategy of collaboration and partnership, and a focused commitment to translational research. The team looks to solve discovery problems using multi-disciplinary cost-effective internal research capabilities and engages external CROs to execute tasks through a network of service providers across the globe. This model, with access to global network and cost arbitrage also affords access to developing markets in addition to developed markets. The company focuses on strong science and looks to expand the opportunities to include non-blockbuster products. This significantly increases the commercialization opportunities and provides a niche which has been out of radar for big pharma. To our knowledge our structure and approach is like no other company that has established such an integrated model in the translation domain of drug discovery and development. Sphaera Pharma has advanced programs on multiple fronts with potential of therapeutic application in diseases associated with mitochondria depletion and dysfunction, MDR, XDR tuberculosis, neuropathic pain, oncology, chronic kidney disease, and a proprietary Platform Technology for application to APIs/NCEs to Repurpose, Reposition, Re-profile & Rescue existing drugs. Some highlights are summarized in Figure 1. More information on Sphaera is available on its website (1). Two recent articles on Sphaera are also provided (2, 3).

Figure 1. Highlights of Sphaera Pharma. 121 Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.


In the end, a successful entrepreneur on the international front needs creative out-of-the-box thinking, attention to compliance, and understanding that the concepts of innovation and entrepreneurship need to be disruptive. There will be a need to adapt, influence and alter the local infrastructure as they are not quite what is needed by an entrepreneur, as no place facilitates entrepreneurship like the US. But then for an entrepreneur these are merely aspects to plan for, not to be deterred by them.

References 1. 2.

3.

Sphaera Pharma. http://www.sphaerapharma.com/ (accessed on 12/20/15). Live Mint. UK’s Wellcome Trust to fund Sphaera Pharma’s MDRtuberculosis drug development; http://www.livemint.com/Companies/ FBwwrn5b67ONDQfwUKEZ0N/UKs-Wellcome-Trust-to-fund-SphaeraPharmas-MDRtuberculosi.html (accessed on 12/20/15). Express Pharma. Sphaera Pharma receives USPTO nod;http:// www.financialexpress.com/article/pharma/market-pharma/sphaera-pharmareceives-united-states-patent-and-trademark-office-nod/160662/ (accessed on 12/20/15).

122 Cheng et al.; Chemistry without Borders: Careers, Research, and Entrepreneurship ACS Symposium Series; American Chemical Society: Washington, DC, 2016.

International Entrepreneurship: Lessons from the Road - ACS

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