The Antidote: Inside the World of New Pharma by Barry Werth

could afford to be truer both to the science and to investors. To Aldrich, this meant not having to prop up less than desirable drug candidates. More and more biotech companies, confronted with onerous burn rates, disappointing clinical results, and slender portfolios were now pursuing questionable therapies longer and longer in the face of ambiguous or even negative clinical data. Such desperation, he thought, inflated expectations ruinously, making the inevitable failures that much harder in the end.
    Aldrich’s business development strategy centered on building out the company’s clinical and commercial arms, a task that became thornier as its original partners were devoured by global players. Renegotiations were expected, and, indeed, made sense for both sides. He was surprised that he still hadn’t heard from HMR, Roussel’s global parent, about the ICE program, expecting someone there to wake up and realize that Vertex had US rights. He says:
    They hadn’t connected the dots, and finally they did. I got this nice fax from the senior VP for business development saying that as a multinational company HMR intended to commercialize its products itself. So I drafted a note that basically said, “We’re really pleased with the collaboration, and we’re happy to go forward. As it stands, there are no problems with it from our perspective.” I remember we put it over the fax machine and said, “This is gonna be interesting.” Within an hour we got back this stream of consciousness: “We must have this, we must have that!” Guy totally lost his cool.
    We had a lot of leverage and we used it. We actually took them up to the brink of a deal where we would have shared control of North America. They could hardly stomach it but they went along with that for a long time. Then we finally said at the end, “There’s an alternative, but it’s expensive: twenty million dollars immediately, give us all these milestones, pay for our sales force, but you can be in charge of the launch in North America.” They jumped at that, since they’d been looking into the maw of shared control, which they hated.
    Disputes, lawyers say, settle for the other guy’s price. Vertex’s business, like its science, revolved around opportunity. With a best-case horizon of three to five years before VX-740 might make it to market, Aldrich settled for immediate cash and ongoing support over any potential windfall if and when the drug would be launched. Such was the innovator’s dilemma in biotech: you needed dozens of projects to make it to profitability, but in order to generate more projects you were forced again and again to surrender most of their value before you knew if your drug worked. Without proof of concept, it was anyone’s guess what a molecule was worth, so deals were sized to fit the competing needs of the partners. In the end, Aldrich extracted up to $206 million in potential licensing fees and milestone payments—provided HMR commercialized VX-740 for rheumatoid arthritis and two additional indications—but these were so-called BioBucks, contingent upon a staggering array of optimal results, and thus as sketchy and evanescent as they sound.

    Vertex had a second approach to rheumatoid arthritis that targeted a different enzyme: p38 mitogen-activated protein (MAP) kinase. Kinases had been discovered in recent years to regulate the molecular traffic inside cells that signals them to function, grow, change, and reproduce. Infinitesimal stoplights, so to speak, they switch on and off billions of times per second, letting some messages through, stopping others. Being so deeply implicated in such a vast expanse of basic human biology, and thus disease areas, made kinases both immensely attractive and daunting as drug targets. As the race to solve the genome accelerated to its conclusion, spurred on by the entry of bio-entrepreneur Craig Venter and his gene sequencing company Celera Genomics, it was now recognized that there were