Right skills, right time, right place – an interview with Chris Grimes-Crompton on the use of interim management in Life Sciences start-ups

The vital role that interim executives can play in the development of all companies, but particularly Life Sciences start-ups is well known. Less understood is the importance of bringing in specialist knowledge and expertise at an early stage, so that using this resource is strategic rather than something that is just called upon in an emergency.

According to Chris Grimes-Crompton, who has more than 20 years’ experience in Life Sciences and pharma, most recently as an interim executive, “the biggest mistakes are made early on. They can also turn out to be very expensive mistakes that can potentially be avoided by having the right skills at the right time“

The biggest mistakes are made early on

Part of the problem is that founders often feel that they cannot afford or need to have commercial expertise at an early stage. Start-up businesses, driven by new innovation and often spun out of leading universities — are generally driven by the scientists who have made the break-through in the laboratory. This means that they lead the development process, without considering how it will be commercialised at a later stage, potentially making their innovation more challenging to bring to patients and ultimately less valuable; science that is looking for an application, rather than meeting a need.

Understanding the market

Failure to fully understand the market, the competition and where the unmet need really lies can have a significant impact. Chris stresses that although organisations might think it’s too early or expensive to bring in interim expertise, when considered in the overall picture it’s far more expensive not to do so. “Because if you are an organisation that wants to be sold at some point or acquired by a larger company, doing things the right way will have a significant impact on the value of the company,” says Chris.

He cites the example of the last company he worked in full-time. It was a biotech business that had developed a product that could potentially be used to treat a number of oncology indications including rare cancers like pancreatic cancer, urinary tract and prostate cancer.

If you are an organisation that wants to be sold at some point or acquired by a larger company, doing things the right way will have a significant impact on the value of the company

The business had previously decided to focus on prostate cancer. On the face of it, this was understandable because — as the most common cancer in men — it represented a huge market. But it was also a cancer that already had many treatments and a challenging regulatory pathway so breaking into that market would be expensive and difficult

If the founders had asked somebody with the appropriate knowledge and experience at an early stage, they would almost certainly have picked a different focus, avoided wasting hundreds of millions in investment, and probably have developed a therapy for patients who had no treatment. Instead, they essentially ended up with nothing.

Access to the right expertise quickly is key

There can be a tendency to procrastinate when a timely intervention would make a big difference. In another business situation, Chris saw a product’s share of the market fall from 80% to about 12% in a short period of time whilst the team attempted to maintain ‘business as usual.`

What was really needed was to bring in an interim manager who could take a dispassionate view and provide some really good practical advice. In this instance, the product did return to growth, but it took a great fall in value for the executives to realise what should have been apparent earlier. Most of the time, the warning signs are there, but there is a general lack of willingness to act because making such a move is not in the plan or there is a fear of breaking the budget. “It could even just be pride that’s preventing corrective action. But certainly, the longer these things go on the worse it gets,” notes Chris.

I think almost every single problem that I’ve encountered has been one of too late or later than would have been optimal

He adds: “I think almost every single major challenge that I’ve encountered has been one of too late or later than would have been optimal. It’s a systemic and perennial problem that afflicts companies of all sizes.” Interestingly, he remarks that, those that are less inclined to fall into the trap are those that are seeking to challenge and disrupt.

Defying usual practice can reap rewards

Chris points to a project he worked on that looked at innovative migraine therapies. The new market challenger, Biohaven understood the unmet need in the market and adapted their commercialisation strategy at the outset, totally changing their business model to a digital-first approach and focusing more heavily on feedback from patients on how and when they wanted to take their treatments.

In part this was because, as a smaller challenger, Biohaven could not afford a traditional ‘go to market` strategy but it was their early strategic decision making on trials, patient needs and portfolio prioritization that were game changing. This paid dividends when Pfizer which had been interested in buying the company a few years ago, ended up acquiring it last year for $11.6 billion, many times the size of the original offer.

In most situations, investors would prefer to have a really good team with an average product than a brilliant product with a decidedly average team

This shows how small, innovative companies can get ahead of the Big Pharma businesses that have little incentive to be efficient. But to really benefit, these small companies need to be prepared to plan ahead for when the business as a whole or one of its assets is acquired. Drawing an analogy with householders who take out insurance in case their home burns down, Chris suggests there is a case for start-ups partnering from an early stage with people who can provide the resources they require as and when they are needed:

“Solutions these days are far more flexible,” he says, pointing out that companies need no longer rely on expensive consulting firms that are staffed by people who are smart, but often lack specific industry experience and knowledge. If you want to stay nimble and want to get the right expertise at the right time, why not get great advice from highly experienced people who can do this on a short-term, interim basis,” he concludes.