A: Some of the key learnings that are required to build a company that will make a difference for the patients we serve include:

1. Integrity: always do the right thing. At the end of the day, all you have is your reputation.
2. All decisions should be done with a patient focus. If the patient does well, everyone will do well.
3. Develop a well-diligenced plan with multiple scenarios for success that integrates science, medicine and business into a value creation model that will be iterated on as you evaluate incoming data in science, medicine and business.
4. People: the first 25 people you hire will determine the future success of your company.  Never settle!!
5. Group Genius: you can hire the best 25 people in the world, but great individual effort will not alone build an outstanding company. You need the genius of the group to make it happen.
6. Hypothesis, Data, Iterate, Decisions. Always base your decisions on the data, iterate on hypothesis when the data tell you to do so, and don’t be afraid to make the tough decisions.
7. Build a culture where great people can do great things; it will sustain you through the good and bad times.

A: Challenging? Yes. Doable? Absolutely.

1. The most important ingredient is the people; you need a team of drug hunters along with experts in data analytics working closely together throughout the entire process- people that that have successfully experienced the R&D and commercialization of important drugs.  The ability of the team to practice “Group Genius” when developing a personalized medicine drug is central to the success in this new world of genetics, breakthrough technologies, big data and translational medicine
2. Now, once you have the right people/team tackling a particular disease, it is key to have a well thought out plan up front in order to obtain The Right Drug for the Right Target for the Right Patient at The Right Time.  This means having validated genetics, doing the right biological/drug discovery experiments and coupling these efforts with Translational Medicine early in the drug discovery process.  The right Natural History Studies, the right subsets of patients in clinical trials to hit your TPP along with the right biomarkers to substantiate your success.  And then when you get the data, be prepared to iterate on your hypothesis.  Do not fall in love with your own genius- it will disappoint you time after time.

A: Theranos, as far as I can tell, has had very little impact on the experienced biotech company builders/investors and how they see the world. Very frankly, it was never considered to be real by most true company builders. However, it is a good reminder for all of us that there are several key company building/investment criteria that should always be adhered to when founding a company in the biotech space.

1. High integrity in everything you do.  At the end of the day, you start and end with your reputation and nothing is more important.
2. And with this focus on integrity, you must always put patients first in all of your decisions.
3. When building and investing in a company, always invest in experienced “A” players and even more important, “A” teams, who have discovered, developed and commercialized break through products.This includes the internal team along with the Board, the company Founders and key advisors.
4. Data means everything as a company develops. Companies who don’t publish/release data because it is always confidential, almost always don’t have the goods. And when data becomes available,be diligent and constructively critical in your evaluation.
5. Strong interactions with the FDA are an absolute must. From the beginning, they are your partner.
6. There is such a thing as too much money.  Raising and raising money is not the answer. Results are the answer.  I have met hundreds of people who say they have raised hundreds of millions of dollars in their last so many companies.  Unfortunately, they never tell you how they made a difference for patients or for their employees or their investors.  I wonder why??

A: Our newest and largest challenge ever is to deliver optimal health care to the patient per dollar that we invest and can afford.  Our health care organizations are a mess and our overall health care costs are out of control in comparison to the efficacy and value they deliver.  Each segment of the industry has grown up independently with its own vision and its own efforts to maximize value for the patient and their investors.  Unfortunately, our health care system has been optimized for local maximums as opposed to a system maximum for the patient and investor.  What this approach yields is a fragmented semi-system that delivers sub-optimal health care for the patient and wastes a tremendous amount of money.

In an ideal world, we would step back, as we often do in our companies, and develop a long term strategic plan for our “U.S. Health Care System.”  This plan would be guided by a few key principles including maximizing patient care within a given annual budget, looking at the overall value creation model for U.S. health care and allocating dollars to the appropriate areas where we can maximize patient outcomes.

This is a big challenge and unfortunately a challenge that Washington is currently incapable of and unlikely to take on.  So what can we do in our own enterprises?

• Have people in our companies take part in PMC, BIO and other organizations where we can continue to work with Washington and speak up for our key principals.
• In our own companies, struggle a bit more with the sometimes conflicting principal of maximizing value for our shareholders and at the same time, maximizing care for patients per dollar they spend.
• And finally, think more about collaboration and pre-competitive efforts.  The Big Data we require to truly understand system biology, drug discovery and translational medicine will take all of us working together.

A: Our future in biology, technology and our ability to optimize the use of Big Data will revolutionize our approaches to patient care over the next several decades. That is a good thing, but here are some challenges:

1. How do we prioritize/decide/afford the future therapies?Personalized medicine will become more and more of the standard for drug development, not only in oncology but across all disease areas. All major disorders, much like oncology and of course rare genetic disorders, will become a group of smaller/genetic disorders. How do we reimburse all these new drugs in subsets of major disorders?
2. How do we begin to implement preventative medicine?  How do we fund? How do we reimburse?How do we allocate more dollars to screening, diagnostics and prognostics to optimize preventative and therapeutic care?
3. And what about care inequality?  Income inequality, one of our greatest issues in today’s society is tightly correlated with care inequality.  How do we ensure that the best treatments are not only available to a few in this country but to all.

A: I will leave you with two stories from one of the Founding Venture Capitalists in Silicon Valley and a mentor of mine in the late 1980s when I worked with him at the Mayfield Fund.

One night at dinner, Tommy takes a penny out of his pocket, extends his arm with penny in hand, out as far as his arm will go. And as he draws the penny in towards one of his eyes, he says “Mark, never let that penny get too close to your eye, because pretty soon you can’t see anything else.”

And on another day, I was sitting at my desk, reviewing business plans, and Tommy comes by and sits downs.  He tells me, “Mark, you are going to see thousands of business plans and meet hundreds of teams. But just remember, you may see a lot of great business plans but with B people.  Never invest in their company.  When you meet A people, whether it is an A or B plan,always invest in them.”

Those two stories have stuck with me for 30 years.  Always, always invest in great people and only great people.  And as your companies develop, and become successful, stay focused on the patient.