If you could build a product that had a total worldwide addressable market of 3,000 people, would take an estimated 8-10 years to build, and cost around $70K per year per customer to manufacture, would you go after this business?
That’s what Jean-Jacques Bienaime set out to do when he took the helm of BioMarin as CEO in 2005. And in doing so, he built one of the leading biotech companies in the world. How did he succeed? First of all, with a stomach for tough challenges, and an ingrained conviction that problems are opportunities in disguise. Second, by focusing on superlative results and dramatic innovation (first-to-market milestone therapies with high barriers to entry). I had the chance to sit down with Jean-Jacques to find out more.
History and Background
For starters, Jean-Jacques explained to me that the US government passed the Orphan Drug Act in 1983 to stimulate R&D in orphan drugs (drugs for a disorder affecting fewer than 200,000 people in the United States), offering businesses with the stamina to go after small markets tax incentives and protection. This, in essence, kick-started the orphan drugs market. BioMarin established its leadership by focusing on an even smaller market: they coined this ultra orphan drugs (exceptionally rare diseases).
BioMarin provides personalized medicine for genetic disorders. The company has now 4 drugs on the market: one with 3,000 affected patients (MPS I), the second with 1,100 (MPS VI), and the third with 50,000 patients worldwide (PKU). The fourth drug (Firdapse) was launched earlier this year to treat LEMS. BioMarin touts the only FDA drugs approved for those diseases. Patients taking their drugs must undergo a genetic test to prove they have the disease (validate the need) prior to taking their drug. The diseases (problems) BioMarin sets out to solve are known, but the treatments are vastly unknown (high technology risk) and expensive to discover and produce. Jean-Jacques explained that this is one of the main reasons the biotech industry as a whole only became profitable in 2009, a full 30 years after Genentech’s founding. Of note, BioMarin is one of the few profitable businesses in the industry.
BioMarin employs a group of scientists who study orphan diseases to determine which ones are feasible to cure. They follow a genetic approach to treatment, as opposed to the shotgun approach used, for instance, in cancer treatment. The objective of BioMarin is to find drugs that can deliver dramatic benefits to their patients through personalized medicine. Incremental or competitive benefits alone are not good enough.
High Technology/Market Risk
We could say that BioMarin faces both high technology risk, and high commercialization risk. The technology risk of finding a treatment are gargantuan, and the market/customers unknown. Epidemiology studies do estimate the number of affected people in the world, but they don’t tell you who those people are. Newborn screenings are not mandatory for most orphan diseases (with the exception of PKU). The challenge is that MPS patients often don’t know they have the disease; they go for years being mistreated and undergoing multiple surgeries before they are diagnosed with a genetic disorder. When there are so few people affected in the world, most primary care doctors will never see a case in their lifetime. So BioMarin needs to spend significant resources educating ophthalmologists and rheumatologists of the symptoms to be on the look out for in MPS patients.
How do you go about finding 1,100 patients who are widely dispersed around the world, and do not know they have a need?? And the challenge does not stop there. Once found and tested, BioMarin still needs to ensure that patients take the medication. To put this into broader perspective, only half of all the prescriptions written in the US are filled. So it takes herculean efforts to find the customers, and educate them. Not for the faint of heart!
Once we find the patients, we need to help them get access to care, find hospitals who can administer the drug, and ensure they take the drug regularly. In some cases we need to arrange transportation — we even have a patient who lives on a tiny island off the coast of Portugal. Some of our patients are wealthy and take private jets to get to the hospital weekly, but others need reimbursement assistance. We have to educate the patients of the importance of taking their medicine regularly. Sometimes it means finding a hospital when they travel, or finding an alternate doctor when their doctor is on vacation.
A truly fascinating story, and one that is uniquely benefiting a formerly undeserved but profoundly affected population, thanks to Jean-Jacques’ vision and dedication.