Knowledge at the heart of leadership
Welcome to Liftstream - Life Sciences Executive Search and Leadership Advisory

European biotech clusters must attract executive talent or seek new leaders

Authored by Karl Simpson

In pursuit of scientific progress aimed at improving healthcare for society, the industry has gone global. Researchers, academics and industrial partners have collaborated across borders, and barriers of expertise, to translate their inventive ideas through a process of innovation. Coupled to this innovation is the catalysing knowledge and experience which is both sourced, and offered, from the four corners of the world.

Biotech clusters remain a prominent landscape feature in global industry

Yet despite the inexorable drive towards globalisation, greatly aided by the digital age which has unlocked the knowledge of the developing world, local ecosystems too have flourished. The dynamism and connectivity of clusters and their combined capabilities have been essential in achieving much progress in the life sciences industries.

The fact that life science companies have clustered in this way is a highly significant feature of the sector. The most evident example of how these clusters have been such hotbeds of collaborative innovation is evident in Boston, MA – where the collection of assembled participants has been both progressive and impressive, largely eclipsing the efforts of others.

The agglomeration of these bioscience economies is a function of ideas, people (and competence), effective scientific research done in the most notable of academic and research institutions, hospitals, investment capital, large industrial presence, effective provision of world class support services, governmental incentives and policy (federal and local), facilities, as well as highly effective infrastructure.

These ecosystems are often incredibly difficult to establish and nurture, often requiring very many, if not all, the aforementioned parts to be put in place before the progressive outcomes, so identifiable in places like Boston, can begin to be achieved.

But what of the people who flow into these clusters and how do you attract them?

One critical feature which continually dominates many discussions at the investor level, at least in Europe, is the lack of leadership and entrepreneurial talent required to create, build or turnaround aspiring innovation companies in areas like biotech and medical technology. It is perceived that the relative depth of this pool is indeed a limiting factor for these ecosystems. And while virtual companies (those relying on a core team and a mosaic of technology and service partners) have proliferated and created more international dimensions to Board and Executive team construction, the pool remains shallow and heavily fished. This also provokes a question about whether the clusters themselves prove unsustainable on the basis of a heavily virtual talent market, a point for later debate.

So what of this ‘limiting factor’? Well, Europe has been incredibly successful in research, even translating this research to the clinic. Where the competitive deficiency comes, is in the number of truly successful ventures which have effectively achieved highly valuable outcomes in terms of successful exits (for investors) and in particular, created businesses of sufficient scale and value which remain independent of large pharma. Those executives who have accomplished these outcomes, the ‘proven ones’, have tended to gravitate towards those European clusters with the strongest pull, the highly effective and successful cluster ecosystems.

The pull or attractiveness of these clusters acts as a professional magnet for highly effective executives. The full impact is seen in the way that European executives with track records or high ambition are inclined to seek opportunity in Boston or San Francisco, further strengthening a strong US talent market, while reducing the depth of the European pool even further.

This function of the talent marketplace and the competition for executives creates distinct challenges for the aspiring bioscience clusters. These clusters need to be highly capable of attracting the ‘world’s best’ executives, otherwise their ability to create an optimal ecosystem which will allow resident biotechnology start-ups and science innovators to flourish, through effective leadership capable of attracting intelligent capital, will be unsustainable. They also need to be able to lock-down that leadership once it is there. For that to happen, the ecosystem needs to generate continuous opportunities.

Why Europe envies the US talent pool for entrepreneurs…it’s a question of capital

Europe is inclined to compare its capabilities with the US and looks at the US as richer waters in terms of this entrepreneurial talent. There are many reasons for their advantages but in some ways it is an unfair comparison. Partly the answer doesn’t actually centre on the ability of the people the US grows and fosters. Instead, it is somewhat a question of capital, or more specifically the amount and type of capital. The US has had a very sophisticated venture capital culture used to investing in innovative technology and bioscience. This has created a very prevalent investment culture extensively populated with experienced serial investors. Some would argue that the contraction in the venture capital community over recent years perhaps points towards ineffective capital distribution which we now know was highly unsuccessful and resulted in this thinning of the crowd, an argument with considerable merit. However, the intelligent capital has made returns for their limited partners and there is now a healthier venture investment landscape.

But to return to the main point, the US has the depth of serial investors who can offer the intelligent capital, which they also can offer in vastly greater amounts. This means you have many more companies invested in, as well as allowing entrepreneurs to build scale and achieve highly valuable outcomes as a result of that scale or extended independence. This is further supported by much more receptive capital markets with specialist investors who understand and willingly invest in risky biotech assets, offering alternative financing pathways and optionality. Finally, the US has just created more successful businesses which have provided ‘serial’ opportunities. And our judgement of success is bias towards repetition, because doing it more than once can’t be luck, can it?

So Europe is hopelessly disadvantaged and it’s all doom and gloom…right?

Well, not quite. Here is the good news. There are new sources of executive leadership. In writing for Bruce Booth’s blog feature, ‘From the Trenches’, successful biotech CEO Katrine Bosley who was CEO of Avila Therapeutics, and who is also a board director with Galapagos and Chairman at Genocea Biosciences, ran some numbers on the recent IPO biotechs. This analysis revealed that of 58 biotech companies that have gone public, 60% of them have a first-time CEO at the helm. Of the 35 first-time CEOs, the average age was 51 at IPO. 43% of first-time CEOs were founders (15 out of 35) but only 26% of repeat CEOs were founders (6 out of 23). The figures illustrate that even in the US where the executive pool is perceived to be deeper, biotechs are being led successfully by first time CEOs. Of course, IPOs are just one measure of a company’s maturity and its value creation, they do not always signal ultimate success, but it is an interesting indicator. (I recommend the read for aspiring biotech CEOs)

In Europe, Executive talent which has ‘serial’ status is becoming more of a feature. The seasoned Executive Board members with all their battle scars and war stories are more present, although securing their services remains a stiff challenge. Configuring and appointing Boards with Executive / non-Executive Chairman, and non-executive board members with vast reservoirs of experience at the sharp end of start-ups can be achieved when calling upon the right resources but competition for their time and commitment remains very high. But Europe does now have a growing base of talent which is far more accustomed to start-up culture. There are also many more highly experienced industry executives who have emanated from progressive biotech innovators like Genzyme, Biogen, Gilead, Amgen, Celgene and Shire; who understand the R&D business and who can offer effective leadership to early stage biotech companies.

So as the big fish take to the deep international waters, it is incredibly important that the local ecosystems of these clusters provide the right environment for aspiring executives to show their credentials, which would be good news for both the individuals, companies and the bioscience clusters.

Liftstream is a privately owned company that provides Executive Search and Interim Management recruitment services to the pharmaceutical, biotechnology and life sciences markets across Europe. Liftstream also works with senior managers and executives to provide highly structured career management services that enable more effective career performance.

Posted in Job Hunting Advice, Pharmaceutical business | Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , | Leave a comment




Contact Us

   Liftstream Ltd.
67 Grosvenor Street
London
W1K 3JN

   Tel: ​+44 (0)20 3178 5864
   info@liftstream.com

Register your CV

Apply for sector specific vacancies or request a confidential discussion



Registered in England No: 5009233
VAT: 843679292

Follow Us





Sitemap