As the North American CEO of a global pharmaceutical company, I constantly face challenges that all CEOs face, with the additional challenge of dealing with an evolving regulatory landscape and federal/state programs that impact our customers and our customer’s customers. During a time when the pharmaceutical and life sciences industry is in a state of flux, there are a few key lessons that I’ve picked up during my career that sets any company up for optimizing long-term growth. These are:
1) using a blend of innovation and acquisition to your advantage, 2) investing in talent development at every level of your organization 3) building a strong, creative and entrepreneurial corporate culture to feed innovation.
Blending Innovation and Acquisition
I began my career in pharmaceuticals with a fourteen-year tenure in sales and marketing at Allergan, followed by time spent as President of Stiefel Laboratories prior to its acquisition by Glaxo Smith Kline. Over the course of my career, I have been privileged to build organizations alongside stakeholders who believed in innovation and executive teams who thrived on bringing those innovations to market. As a result, I have seen firsthand, the positive results of a business strategy focused on combining in-house product innovation with a targeted acquisition strategy. My goal has always been to provide physicians and their patients with the type of real product innovation that they have come to expect from leaders within the pharmaceutical and life sciences industry.
I have brought this philosophy of balanced, long-term growth to the organization I currently lead, Merz North America. Unlike our largest competitors in the pharmaceutical space, we are fortunate to be a family-owned and privatelyheld company, which allows us to focus our full attention on serving patients and physicians, rather than calculating earnings per share.
"Taking the long view means developing a growth strategy that balances innovation and acquisition, in my experience the best recipe"
Also unlike many organizations within pharma and the life sciences, we are able to commit to long-term business strategies knowing that we can weather a myriad of events due to a balance sheet that is cash-rich and debt-free. We also invest more than fifteen percent of our annual budget in research and development with the goal, not merely of developing a blockbuster drug, but also of developing additional, meaningful indications for our current products. This strategy of balancing organic and inorganic growth is being implemented by multiple companies that are household names. For example, Apple has made headlines recently by announcing their interest in acquiring the Beats by Dre franchise–and by launching a new operating system and health apps, both of which were developed in-house.
Investing in Talent Development
In addition, I believe that a longer-term approach to business growth will only be successful when it harnesses that key component to any company’s success: people. In answer to some executives who have recently argued that individuals sitting at desks and in offices fail to add value, I would propose that, a team effort is required to make products successful. We are proud to have implemented a truly cross-functional approach at Merz. I have come to believe that the insights of the team that works to develop a product and bring it to market are also essential in supporting the marketers as they drive the product and execute strategy. In the pharmaceutical and life sciences industry, we need bright legal, financial and regulatory minds who help us think through our loyalty programs, as well as compliance experts who ensure that our overall strategy follows the letter of the law. We need global teams of scientists to develop drugs and oversee our clinical trials. Our colleagues in Technical Operations add great value by driving cost out of the business and increasing our margins at the source. We need specialists in channel marketing and communications in order to communicate clearly with both internal and external stakeholders and then to help us wrap metrics around the effectiveness of those messages. Finally, our human resources colleagues are instrumental in building a talent bench that is deep and ensuring that our organization is a place where people can enrich their skill base and grow their professional experiences. All these functions have the opportunity to make a difference and contribute to our longterm growth and success of our organization on a daily basis.
Ultimately, taking the long view means developing a growth strategy that balances innovation and acquisition and is supported by an appreciation for the true necessity of robust talent development. In my experience, this is the best recipe for the kind of strong and entrepreneurial corporate culture that is needed to drive innovation. Innovation should be the life-blood of the pharmaceutical and life sciences industry, and it only thrives where people feel valued and when corporate decisions are based on a long-term vision for the future.