- Leadership is the ability to influence or guide others.
- Too many pharma CEOs are bad leaders because they fear failure, losing power, and focus too much on metrics not important to the rank and file.
- Six out of 10 employees said they feel demotivated by their CEOs; 70% say CEO pay was too high in general.
- The median CEO of the drug companies outpaced the more modest pay gains of their employees.
So these are today’s drug company CEOs. Senior executives at five drug companies, including Moderna, Pfizer, J&J, Emergent Biosolutions (contracted to manufacture J&J’s vaccine), and Novavax made $250 million dumping company stocks during the first six months of “Operation Warp Speed.” Of course, there was a direct correlation between their pay and the company’s stock price because that’s what it’s all about.
Being a CEO does not mean you’re a leader. Business leadership is about setting a strategic vision and inspiring others to achieve it. Effective leaders motivate action around a common purpose, and good leaders provide the motivation plus a healthy dose of integrity. How does that align with an FDA approval of a drug that is liable to hurt more people than it helps?
To date, I haven’t heard one pharma CEO speak up about the challenges the industry is facing (high drug prices, possible government negations with Medicare, lack of talent). However, they will talk about how price controls will limit innovation when that innovation comes from mergers and acquisitions more than R&D.
I have a lot of contacts within the industry, and more and more, I see a real disconnect between what they are trying to do and what CEOs say they want to do. I’ve seen more people leave the industry or go to smaller biotech firms where they can make a real difference. Not too long ago, a B school survey showed that almost nobody wanted to work for a pharmaceutical company. That’s a huge red flag. To get around this, pharma has to offer bigger salaries but do you really want people who are drawn to the industry because of a six-figure salary?
Working in the pharma industry is unique because we have the opportunity to help people but what new hires often find out is that there is a culture of back-to-back meetings and a focus strictly on ROI over patients. A colleague I talked to just graduated from MIT with an MBA. She was offered a great position at a company in Cambridge, but she asked if she could spend a week at the company before formally accepting the position. After three days, she turned them down. When I asked why she told me, “my God, all the meetings where decisions weren’t really made, and absolutely nobody was thinking of our customers (patients).” She wanted to know if “they were all like this.”
IF you want an example of a CEO who was a leader, read books about Steve Jobs. Yes, he was harsh and could be a prick, but he helped a bankrupt company become one of the leaders in the industry through his vision. He didn’t care about Wall Street because he was more interested in “changing the world.” When was the last time ANY pharma CEO made a speech that inspired you?
In a healthy organization, managers will accept the strategic direction shared by the leadership team and find ways to carry it out. In a poorly performing organization, the relationship between the CEO and employees is non-existent. What CEOs say in front of Congress doesn’t match the company mottos in the lobby.
Rich, you’re critical again. I know, but I am passionate about the industry, and I have seen first-hand how the products we make can restore joy in patients’ lives. I wish a CEO could install THAT vision in everyone instead of sales targets.