The Antidote: Inside the World of New Pharma

by Barry Werth

  “I said, ‘Listen, we don’t have a good way to detect how this amorphous suspension is going crystalline, but it’s a phase change; there should be heat involved. Let’s put it in this calorimeter and see what happens,’ ” Connelly recalls. “So that’s what we did. We knew it would crystallize; the name of the game was how long would it take. Sure enough, we saw a little blip. It took four and a half hours to complete.”

  Investigating further, Hurter learned that the Belgian clinicians had waited almost the full twenty-four hours before mixing the suspension, meaning that the VX-950 had crystallized long before the patients drank it. Reassured that the compound was stable long enough to make the transit reliably from mouth to small intestine to bloodstream, but was highly susceptible to heat, they designed a temporary solution: VX-950 needed to be kept refrigerated, and then mixed with water and shaken, not stirred, in an air-conditioned room right before it was administered. “The James Bond protocol,” it was called. By early fall, Hurter’s group had a formulation sufficient for the Phase Ib trial: a few dozen patients, fourteen days. But getting from there to making a pill that could sit on a pharmacy shelf anywhere in the world until some far-off expiration date remained another order of challenge entirely. Adding two more chemists in October, she bolted ahead.

  For a year, prompted by Smith’s and Ken’s dire warnings, Boger had strengthened Vertex’s business. The company added two more knowledgeable, experienced directors to its board: a former vice chairman and president at Pfizer and a former US assistant secretary for health, whose combined expertise, contacts, and profiles might help steer the company through the regulatory process. The week after announcing the Mitsubishi deal, it signed a global collaboration with Merck in cancer research, delivering $34 million in up-front development support for its lead kinase inhibitor, $350 million in BioBucks, instant vindication of the Novartis restructuring, a sense internally that the company was emerging from its doldrums, and deep personal benediction and satisfaction for Boger.

  Merck remained the industry gold standard, however tarnished by the recent reversals to pharma’s image. With drug prices skyrocketing, the sector had fallen further, faster in public esteem in recent years than any other industry in history, according to polls showing that Americans now viewed drugmakers as on a level with tobacco companies. Former Merck chairman Roy Vagelos, noting the “exorbitant” costs of new medicines and “galloping” annual hikes of old ones, predicted a reckoning, again raising the specter of government price controls, as he had done during Clinton’s first term a decade earlier.

  With pharma spinning, Boger could see more clearly the opportunities for changing not only the way drugs are discovered but also how they are developed and sold. The awareness startled him, coming as a kind of secondary revelation, since when he started out, it hadn’t crossed his mind that Merck and its peers could topple so rapidly.

  Ken recommended that Boger meet with a former client of his (Ken’s), an independent Boston management consultant named Bink Garrison. Most pharmaceutical CEOs confronted with questions about the direction of their business in a changing market rely on McKinsey & Company, the consulting giant, which had helped build most of the top ten prescription brands and supported nearly all the largest mergers within the industry. Garrison, a former advertising executive, counseled McKinsey when it wanted to develop its business, and he worked primarily with Fortune 500 companies. After graduating from Princeton University in the 1970s and a stint as a nuclear weapons officer on a navy submarine, he’d started his career as a copywriter. Tall, lean, soft spoken, he favored bow ties and other WASP accessories, though his everyday speech combined what he calls “the adman’s bag of tricks” with an incongruous, hipsterish patter. Garrison dressed like George Will but sounded like Don Draper channeling Allen Ginsberg.

  “I went over there and met with Josh and Vicki,” Garrison recalls. “They kept talking about this communication problem they had with the board. I said, ‘Well, what do you mean?’ They said, ‘Well, they don’t really get what we’re doing.’ I said, ‘So, okay, what are you doing?’ Twenty minutes later, I had a little bit of an idea, and I said, ‘I have good news—and good news for me. The first good news is that you do not have a communications problem. You have a strategy problem. You can’t express what you’re doing. And the second good thing, for me, is I do strategy.’

  “I said, ‘Who are your folks?’ My proposition was, ‘Let’s put them in a room together for a day, day and a half, and find out not only what you think but what they think. And what you’ll create is alignment between you and your team, and you’ll have something to tell the board.’ ”

  Boger leapt at Garrison’s offer. He believed that what Vertex needed wasn’t management consulting but a homegrown process for navigating the challenges of becoming a world leader while drawing on and renewing its culture—to discover what sort of company it truly could become not by reviewing others’ best practices but through rigorous self-examination. “I was explicitly trying to systemize, institutionalize something that was already there but that was somehow going to get lost unless it had a more explicit verbalization and home,” he says. “When I met Bink, I said, ‘This is the guy. I need this person because he understands how to drive that in a nonhokey way, how critically it’s lacking in large companies, and how you can’t retrofit it easily.’ ”

  Garrison met one by one with all the members of the executive team. His framework derived from Jim Collins’s breakout bestseller Built to Last: Successful Habits of Visionary Companies, the classic investigation into the norms and practices of innovative companies that management gurus and CEOs globally regard as a data-proven tool of what defines corporate culture. It was based on yin and yang: complementary opposites. “On the one side of the yin is core ideology—which is core values, what do we really believe in? it’s not negotiable—and on the other side is core purpose: Why are we on the planet?” Garrison explains. “In a company that’s been around for anywhere longer than twenty-four months, that’s not something you create. It’s an archaeology project, not a creative project. You discover it. The other part of it is an envisioned future—a ten- to thirty-year ridiculous goal. Collins calls it a BHAG: Big Hairy Audacious Goal. What would it be like, the top of the mountain? Describe it.”

  On a day in July, Garrison met off-site with senior management and a handful of others, including Murcko and Thomson. His goals were to generate a clear, concise, easily understood description of what Vertex is: a Vertex “vision, mission, and differentiation” statement, an acceptance that corporate positioning is based on reality and substance and not fluff, and a “perceptible rise in energy based on newfound clarity.” To get them talking, he had them use analogies: If Vertex were an animal what would it be? Or what brand of car would it be? A Ferrari, a Lexus, a Prius? “The whole purpose was to till up the garden,” he says, “to get some action.”

  Boger had told Garrison after their first meeting, “I’m gonna hire you away.” Garrison, whose greatest gift may be that top CEOs appreciate him almost as a personal trainer, said he wasn’t looking for a job. Boger replied, “I’m gonna make you an offer you can’t refuse. I’m gonna cut your salary by ninety percent.” Throughout the fall, as Garrison began to probe deeper into the company, Boger showed that he was serious. He made the Vertex Vision Process—a grassroots, companywide exercise to find out what people really believed about who they were and what they hoped to achieve—his top priority.

  “This is something I was desperate for,” he says. “We ran it, as usual, as a complete experiment. The intellectual content is, first of all, values are immutable. They’re not something that you can decide to change. If your values are that you’re evil, you can’t decide to be good. Once your value is being evil, that’s your value, and it doesn’t matter how many consultants you bring in, you can’t change it. When is that set in stone? Probably much earlier than most people think. I would say in most social and organizational structures it
’s set within six months. So we actually went on an exploration. We asked across the entire Vertex world, independently, what were the values. It came down to basically, on our best days, how do we act?”

  When Sato first explained the concept of fear and fun to the researchers at Aurora, many recoiled. It troubled them that fear was an articulated component of Vertex’s culture. “It’s not fear of being chained to the galley oars,” she explained. “It’s about fear of not rising to the challenge of what the world needs. It’s the fear of being mediocre.” In that sense, there was no distance between Cambridge and San Diego; aspirations were equally high at both sites. Tung had moved from Massachusetts and now co-led with biologist Paul Negulescu a Left Coast version of Vertex, one where the ambition and drive were the same, but half the scientists also participated on weekends in CF walks, and more than a few took a couple of hours at dusk to surf at Torrey Pines State Natural Reserve before grabbing some fish tacos at a stand and returning to the labs. Project leader Eric Olson, a clear-thinking and adept strategist, uprooted his family to Cambridge, where he could represent Aurora and drive ahead the CF clinical program. At his send-off in the cafeteria, his colleagues gave him an enlarged photo of the panoramic view from the boardroom, a snow shovel, and other necessities for winter in Massachusetts.

  With the added funding from the CF Foundation, Negulescu, Olson, and the project group pushed more deeply into the problems of trying to correct broken CFTR in the epithelial cells of patients. These are the cells that line cavities in the body and also cover flat surfaces. The new team leader was Peter Grootenhuis, a Dutch medicinal chemist and deft scientific manager, a recent veteran of a rapid M&A mash-up at another firm that left him working at the same site but for four different companies in four years. Grootenhuis, a part-time virtual professor at Dutch universities, guided the incorporation of Aurora’s cell biology into the overarching methodology of making drug compounds, which is improvement through modification. He inherited a familiar standoff. The chemists needed better assays to tell if their molecules were working; the biologists were impatient with the chemists for not delivering more potent molecules. Though the group had several hits from three different screens, progress had stalled in developing leads. Without better assays, there was no way forward.

  “I had to first make sure that we work well together as a team,” Grootenhuis says. “The thing about CF is that there was no animal model, so all we had were assays that we ran in different cell lines. We expressed human CFTR in mutants, but there was no way of knowing how reliable or predictable of a read that was. The view in biology was that if we can base our assay on human bronchial epithelial cells from CF patients, that was about the closest we were going to get.”

  As leader of CF biology, Fred Van Goor set about conceiving of a model system, one that would convince them that they were on the right track. A deliberative thinker with a laid-back quality belied, at age thirty-six, by a mane of gray hair that seemed to balloon when he was deepest in thought, Van Goor had done his PhD thesis on ion channels and then spent another five years at NIH studying endocrinology. He recognized that everyone with defective CFTR had the same array of symptoms, but CF was not a singular disease. It resulted from a myriad of different mutations causing two main types of defects: either not enough properly folded protein gets to the cell surface, or there’s sufficient protein at the membrane but with channels that don’t remain open long enough to allow salt and water to pass through. In the lungs, the trachea (windpipe), and the sinuses, this retarded flux allows mucus to build up and cake, providing a fertile field for bacteria and gunking up the cilia, the fine hairlike projections that sweep away detritus and help keep the airways clear.

  Van Goor’s group had run the screens that yielded molecules that increased both the amount and functioning of CFTR, but not within human cells, much less cells that might provide a clue as to whether they would work against disease.

  Sabine Hadida, who headed the CF medicinal chemistry group, had joined Vertex from the same orphaned San Diego outfit as Grootenhuis, though they hadn’t worked together. As a postdoc at the University of Pittsburgh, Hadida had invented a widely adopted synthesis, and she had an ability, like Tung, to go into areas where the chemistry was thought to be well understood and discover new angles of approach. As her group tried everything it knew to improve on its hits—and as she sensed that the biologists, unaccustomed to working with chemists, weren’t helping—her dismay at not having a more representative assay flashed over. “Number one, we had to convince Fred that we knew what we were doing and that this assay was not really helping us,” she recalls.

  “Number two, we had to convince the whole biology group that those hits were not really going anywhere. We were able to eliminate the activity, but we were not able to improve it. Everything we would do would keep it the same or worse.”

  Van Goor reasoned that human bronchial epithelial (HBE) cells from patients with CF could provide a solution. A few academic labs had cell lines, and with the help of the foundation, he recruited collaborators to help test several groups of compounds. While they were looking both for corrector molecules to fix misfolded CFTR and for so-called potentiators to open the channels longer, the team found itself reckoning with a startling new reality: that far more CF patients had folding mutations and thus would be helped only by correctors, which were much harder to find and develop. “The rate of finding a corrector is 0.002 percent,” Van Goor says. “Then you have to make it a drug.”

  Here was the emerging dilemma of twenty-first-century drug discovery and development, of medicine itself. Among CF patients, the most common defect is the deletion of three bits of genetic code in the F508 region of the gene for CFTR—delta-F508. Half of all patients have two copies of the delta-F508 mutation and up to 40 percent have one, meaning that the great majority of patients—those who by and large, because they have almost no functioning protein, suffer the severest symptoms—would need a corrector for any hope of relief. Meanwhile, only about 4 percent of patients—around three thousand worldwide—were known to have the G551D mutation, a gating defect that had yielded Vertex’s most promising hit for developing a potentiator. How did you decide what to pursue, the greater need/opportunity or the path likelier to succeed? For sick patients and their families, personalized medicine couldn’t be more personal.

  “In CF you’re talking about eighteen hundred different mutations,” Van Goor says. “That’s like eighteen hundred different diseases. It’s a real research, then development, then regulatory, then marketing challenge. Everybody says they know all about it, but how are we going to develop medicines for that? Because that’s the future. The future is to know somebody’s genotype—modifier genes or mutations that cause disease—and then make drugs that are tailored to those. How do you work in that new world? How do you evaluate it? It doesn’t cost any less to develop a drug for five people than it does for a hundred thousand: same preclinical studies, clinical studies, it’s all the same. What we’re trying to do is use biology to provide a reasonable rationale for how different classes of mutations are distinguished from each other, so it’s not eighteen hundred, it’s three.”

  In August Hadida’s group made a potentiator that Van Goor personally took up to the lab of a collaborator at Stanford, who had developed a line of delta-F508 HBE cells. The compound was ten times more potent than the starting point. “We had not seen that in all these years,” Hadida recalls. The goal and philosophy of everyone on the project remained to go hardest for a corrector, but the gain in activity was a milestone, affirming their approach. It convinced them to press harder on both fronts. “We said, yes, now it’s real,” Grootenhuis says. “The problem with that molecule is that it was a brick. It was completely insoluble. It had bad pharmacokinetics. A bunch of things were wrong, but we loved the activity.”

  On November 1 Vertex reported at the Liver Meeting (AASLD) that VX-950 was well tolerated and had favorable PK properties in healthy volunteers, ac
cording to Phase Ia clinical results; Alam announced that the company would begin testing the drug in infected patients within a few weeks. That morning’s Wall Street Journal featured a front-page investigation into Merck’s four-and-a-half-year rearguard action to conceal what it knew about the safety of its blockbuster painkiller Vioxx, which it recently had pulled from the market after studies tied it to heart attack and stroke risk. “By 2000,” the paper reported, “one email suggests Merck recognized that Vioxx didn’t merely lack the protective features of old painkillers but that something about the drug itself was linked to an increased heart risk.”

  On March 9, 2000, the company’s powerful research chief Edward Scolnick e-mailed colleagues that the cardiovascular events “are clearly there” and called it a “shame.” He compared Vioxx to other drugs and wrote “there is always a hazard.” But the company’s public statements after Dr. Scolnick’s e-mail continued to reject the link between Vioxx and increased intrinsic risk.

  As academic researchers increasingly raised questions about Vioxx’s heart safety, the company struck back hard. It even sued one Spanish pharmacologist, trying unsuccessfully to force a correction of an article he wrote. In another case, it warned that a Stanford University researcher would “flame out” unless he stopped giving “anti-Merck” lectures, according to a letter of complaint written to Merck by a Stanford professor. A company training document listed potential tough questions about Vioxx and said in capital letters “DODGE!”

  Reputation, vital in any business, counts even more so in medicine, where it correlates to a rare degree with trust, market muscle, and influence. In Boger’s analysis, Vioxx was a case study in how to destroy an organization’s image. First comes a problematic product, then executive hubris, then foot-dragging, and then finally the thuggish self-deception that you can beat the rap with cover-up and intimidation. One decade you’re on top; the next you’re acting like a tobacco giant. Boger was more saddened than surprised by Merck’s spate of reversals: its new-drug pipeline was nearly bare, and within two weeks, three hundred personal injury lawyers would gather in a ballroom at the Ritz-Carlton Huntington Hotel and Spa in Pasadena, California, for what the Times called “a combination strategy session and pep rally on Vioxx claims” estimated at up to $10 billion. As always, he believed the only way to avert such a downfall—beyond having a robust portfolio and high wattage across the functions—was through organization and culture.