Biogen’s fall: the key lessons

KEY TAKEAWAY: Biotech companies that transform themselves into big pharma on the strength of one or two drugs are destined to fail if they forget what made them great. Biogen was a small biotech company who fancied themselves as a player in the big pharma arena. Now, in all likelihood, they are going to be bought.

Six years ago I interviewed at Biogen in Cambridge but what I saw with my eyes convinced me that it would not have been a good fit. The open offices didn’t even have phones at work stations. If you wanted to make a call you had to go to an enclave. But what really stood out, to me, was the people I interviewed with. Most were very uptight and the culture was not conducive to making things happen.

Not too long ago Biogen’s CEO bailed out and I started to see that a lot of the people that I knew at Biogen were gone. Today Biogen’s Alzheimer’s drug aducanumab imploded in a PhIII disaster and the stock is down 40%. They are now an acquisition target.

When I first moved to the Boston area Biogeny was a great biotech based in Westin. However, they fancied themselves as big pharma and soon took on a LOT of debt to move to a sprawling downtown Cambridge campus. I also noticed that a lot of the people who were with Biogen when it was just a small biotech company were leaving and being replaced by contractors and people who were going from one pharma company to another. What really scared me though was that a lot of the people being hired had questionable accomplishments.

When Biogen’s CEO left a couple of years ago without a replacement I knew the shit was going to hit the fan. One of their MS drugs, despite the DTC, was receiving a LOT of negative feedback within the MS community on social media and trials of their Alzheimers drug were questionable at best.

Often, on my bike rides through downtown Cambridge, I would go by their campus and you could just sense that these people were dealing with a culture of meetings and bureaucracy reserved for big pharma.

Now, in all likelihood, they are in play but it’s going to be more of a fire sale than buying a company with real assets. There are now a LOT of competitors in the MS market with more coming. This is what happens when you believe your own press releases.

In an era of mergers and acquisitions pharma is still its own worst enemy. Small and nimble is a lot better than huge and bureaucratic. Biogen is a lesson for all biotechs that launch a successful product. Remember what made you great and don’t get a big head.