The vision of Life Science Leader is to help facilitate connections and foster collaborations in pharma and med device development to get more life-saving and life-improving therapies to market in an efficient manner. Connect, Collaborate, Contribute
Issue link: https://lifescienceleadermag.epubxp.com/i/320415
EXCLUSIVE LIFE SCIENCE FEATURE leaders LIFESCIENCELEADER.COM JUNE 2014 26 e catch up with Lechleiter at the latest PhRMA meeting, where he sits and speaks with us about Lilly 's scientific strategies, investment and partnering, internal and external research, cost and effectiveness of clini- cal development, precommercial col- laborations, regulation and reimburse- ment, patient-centered products, and other factors that affect the company 's odds of success as an innovator. He tells Lilly 's tale of trial and tenacity from the CEO's perspective — executive thought process and leadership, decision-mak- ing, and adaptation to changing circum- stances — in the context of the cor- poration, its management team, and its organizational assets. Later events in the following weeks heighten the drama but do not dimin- ish the relevance of Lechleiter's talk with us. I never get the feeling he is merely parroting the same speech for every occasion, though he makes sure to include his talking points. In conversa- tion, Lechleiter also shares his thoughts as well as facts. As one example, when asked about Lilly 's animal-health busi- ness, Elanco, he elaborates on the unit's role in a way that seems completely consistent with the company 's pur- chase of the animal-health business of Novartis two weeks later. As the conver- sation moves through the many areas of Lechleiter's responsibility, we learn not just what the company does, but why. THE DARKEST HOUR: AN IP LOSING STREAK Lilly was already in trouble when Lechleiter took the CEO job in 2008. So, when asked what were his most difficult days in office, he unhesitatingly cites the first ones. " When I came into this job, we were looking ahead in three years' time to losing a series of patents that probably represents the biggest sort of bolus of patent losses that any company, particularly adjusted for size, has sus- tained," he says. Patent losses included the antipsychotic Zyprexa (olanzap- ine) in 2011, depression drug Cymbalta (duloxetine) in 2013, and Evista for osteoporosis (raloxifene hydrochloride) in March 2014. "At the same time, we looked at our pipeline, and as recently as 2005, we had only seven molecules combined in Phases 2 and 3." Nowadays, he adds, the late- stage pipeline contains 38 candidates, with three potential launches in the near future. " We knew it was unlikely our new launches would come in time to soften the impact of the patent expirations. They were going to come, as they are now, toward the end of that period," says Lechleiter. "How do you manage TO TRACE JOHN LECHLEITER'S CAREER is to travel an unusually straight line even by phar- maceutical executive standards. He has held 12 previous positions at Lilly since joining the com- pany in 1979. But his course took a sharp turn early on; beginning as a chemist in the com- pany's process chemistry group, he would soon step onto the management path. When his boss left in 1982, Lechleiter accepted the opportunity to lead the group, changing his direction from hands-on science to research management. "It was a difficult decision," he says. "I wres- tled with it for months, because I liked doing science and yet I also knew that I would enjoy essentially helping other people get results and contributing in a different way. I also knew it was a one-way path — once I left the labora- tory, it would be the beginning of a new career. But I really never looked back." After moving up in R&D; management for the next 12 years, mainly in drug development, Lechleiter assumed the regulatory affairs lead- ership, beginning in 1994, and was on the corporate ladder from then on. In some ways, his career-long ties to Lilly belie a consider- able diversity of work experiences, including a stint heading product development for the Lilly Research Centre in Windlesham, England, and a unique, decade-long tutorship as a direct report to legendary ex-chairman Sidney Taurel. In The First Person — Lechleiter At Lilly W the company, finance your business, pay the dividend, and keep investing in R&D; when your sales are plummeting, as they tend to do when a small mol- ecule comes off patent, until you can start launching the new products? That is what has consumed me for the last six years." In December 2009, Lechleiter and his team laid out a plan for investors: " We said, in no single year, from 2011 to 2014, would our revenue fall below $20 bil- lion, our net income below $3 billion, or Lechleiter credits Taurel with helping bring out the best of his natural bent for manage- ment. "He was a great mentor and I had an opportunity to learn firsthand what a CEO does, what the thought process is, and what kinds of decisions one has to deal with in that role," he says. "I come at the job a bit different- ly from others. I enjoy working with people. I enjoy seeing others getting results, in essence, through people. I may have discovered along the way I have a talent for certain things in that vein. I didn't have an MBA and didn't know too much about matters of business, marketing, accounting — all the sorts of things that a CEO has to worry about. But I was able to learn a lot about it along the way." Since Lechleiter completed his chairmanship of PhRMA in April 2013, he not only continued to face some tough times at Lilly, but under- went surgery for a dilated aorta in May. After only two months, however, he had made a pos- itive recovery and was back on the job, looking fitter and, if anything, even more perseverant in the face of adversity than before. How can you praise someone for being modest? All you can do, really, is to observe that part of the person's strength that comes from not wasting energy on personal conceit. For other CEOs, it must be highly distracting to act the haughty and vaguely celestial cor- porate king, a style of unfortunate currency in our time. Maybe it's Lechleiter's Kentucky roots, or a general Midwestern calm, that accounts for his equanimity, but whatever it is, it is genuine and completely unaffected, and at the same time powered by a steely determination. Logically, those are the same qualities that explain how he could plow through the past months and years — per- haps the most difficult time ever for Lilly and for Lechleiter personally. LILLY NAVIGATES THE REALITIES OF INNOVATION By W. Koberstein F e a t u r e - C o v e r - L i l l y . i n d d 3 Feature-Cover-Lilly.indd 3 5 / 2 1 / 2 0 1 4 1 2 : 1 6 : 0 3 P M 5/21/2014 12:16:03 PM