Slone Partners’ 2018 PMC Interview Series debuts with an exclusive, in-depth interview of Daniel O’Day, the CEO of Roche Pharmaceuticals. A division of Switzerland’s Roche, Roche Pharmaceuticals is a life sciences powerhouse, treating over 137 million patients in 2017 as the world’s largest biotech company and provider of cancer treatments. Mr. O’Day discusses Roche Pharmaceuticals’ market leadership, motivations for personalized medicine acquisitions, and his executive life living in Switzerland, Japan and Denmark. This ongoing series of healthcare executive discussions is presented in partnership with Personalized Medicine Coalition.
Slone Partners: You’ve been at Roche since 1987. In your opinion, what’s been Roche’s greatest accomplishment over the past 30 years? What decisions did Roche make so correctly to propel the company to such global market leadership?
Mr. O’Day: I think all of us at Roche would measure our level of accomplishment by the number of groundbreaking medicines we’ve brought to society. In that respect I’ve had the fortune of being here for one of the most exciting and prolific times in our history. In oncology alone we have really been pioneers in advancing targeted treatments like Rituxan and Herceptin. I would say we have changed what it means for patients who get a diagnosis of HER-2 positive breast cancer and indeed many other tumor types. Today, many of our medicines are for diseases where there were no previous treatment options or no treatment advances in decades, such as Ocrevus for primary progressive multiple sclerosis and Hemlibra for a certain type of hemophilia. The FDA has awarded a total of 23 breakthrough designations to our medicines, across multiple disease areas including hematology, neurology and ophthalmology. I believe that level of innovation and the impact on patients worldwide is a terrific accomplishment.
I would say many of our smartest decisions have been around our organizational model and our innovation network. Roche has been quite purposeful about keeping autonomous research centers, including Chugai in Japan, Genentech in the U.S. and Roche in Europe. We take the same approach with our partnerships, our scientists, and in fact all our employees in that we very much encourage autonomy. It has proven to be a winning formula for driving innovation. I would also say that we were really ahead of the curve in our strategy of pursuing personalized healthcare and our decision to have Pharma and Diagnostics under one roof.
Slone Partners: Roche has recently acquired Ignyta, Flatiron Health and Foundation Medicine. What is it about the future of precision medicine that excites you and the Roche Board?
Mr. O’Day: We know that we are at a pivotal moment where an exponential increase in healthcare data and having the right analytics capabilities to interrogate that data is going to significantly improve the way we develop medicines and bring them to patients. Data insights are giving us a much more precise view of patients and their disease than ever before. These precise insights generate really exciting potential, such as better, more certain outcomes, greater efficiencies and reducing the time it takes to get a medicine through development and into healthcare systems.
Let’s take the use of real world data in clinical trials, for example. When you’re running a traditional control arm study, comparing an experimental medicine to the current standard of care, it’s a very time-consuming process to recruit patients for those trials. We could reduce time by supplementing clinical data with real world data or in some cases even eliminate the control arm altogether, for example in rare cancer types. This will accelerate the process and it will be better for patients.
We are already seeing the value from data insights, but we need to make the application of these insights routine in both drug development and healthcare decisions. Getting to a stage where we can make that happen is going to take a collaborative effort across industries and disciplines, which is why we have acquired Ignyta, Flatiron Health and Foundation Medicine. We are investing in them to help accelerate their progress in their respective fields. In addition to these acquisitions, we have lots of partnerships in various areas from machine learning to data sources. Having partnerships with entrepreneurial companies that are leaders in their fields is very important. It helps us to stay at the cutting edge of innovation.
Slone Partners: Roche as a parent company is in disease treatment, diagnostics and pharmaceuticals. With so much general convergence in healthcare today, and with the explosion of personalized medicine and wearable or implantable technology, are business lines at Roche getting blurred and are patient roles changing?
Mr. O’Day: The degree and pace of change is greater than I have ever known. We’re seeing new players in the field, new trends and certainly patients are playing a more involved role today. These are all developments that are great for advancing healthcare and addressing many of the problems we need to tackle. I wouldn’t say business lines at Roche are getting blurred, but we are collaborating in new ways with new types of partners such as technology and data companies. We value their complementary expertise and they value ours. We each play different roles in the healthcare ecosystem.
We are also developing our own in-house technological expertise and building our capabilities in data science and analytics. Our fundamental approach, the mainstay of our business, is exactly the same – which is bringing transformational medicines to society, but our potential to do this in a more powerful way and in greater collaboration with patients and healthcare providers is unprecedented. I really don’t think there has been a better time to be in healthcare.
Slone Partners: You’ve lived in San Francisco, New York City, Switzerland, Japan and Denmark, to name a few. When you’ve seen the world and its people, are involved with the vital treatment of tens of millions of people, and have a greater understanding of humanity’s grandest challenges than most, now as CEO, how do those lenses affect your thinking and decision-making?
Mr. O’Day: I feel very fortunate to have had such a varied global career and I think these diverse experiences have formed who I am as a person and my thinking on most things. This diversity is something I always wanted because a leader needs to be able to appreciate many different perspectives. Over the years, I also gained an appreciation for the many fundamental differences in healthcare in different countries and regions of the world. I don’t just mean at the superficial level of systems, policies and infrastructures but also in philosophical approaches to society’s role in healthcare and then of course there’s affordability and access. As a global healthcare company, we see that we need to take a decentralized approach and facilitate tailor-made approaches for different countries.
At the same time, the needs of patients are the same wherever you are. Every individual wants and deserves the best possible care. To that end, we strive to raise standards across the entire healthcare ecosystem and going back to my earlier point, the use of data and analytics offers a precious opportunity to do that. This is why we’re working toward things like universal data standards and the broad availability of genomic profiling.
Slone Partners: Are there any important, insightful questions you specifically ask Roche leadership candidates? What are they?
Mr. O’Day: It’s valuable to get to the heart of what makes someone tick. Their sense of purpose needs to match with our culture and our intrinsic motivation of making a difference for patients. It sounds simple, but I always tell people to follow what makes them happy because if you really enjoy something and find it highly motivating, the chances are you’ll do well at it. If your sense of purpose doesn’t match with the mission and purpose of the company, you’ll only get so far. On the experience side, I always look for folks that have a diverse mindset and are driven by looking at problems from multiple angles. I believe very much in spending a lot of time in the hiring process, getting that right, hiring the very best people you can.
Slone Partners: What makes you happy personally? What makes you happy professionally?
O’Day: On the personal front, I know it’s a cliché, but I’m always happy when I get to spend time with my family. I also enjoy running and fitness in general. No matter where I am in the morning, I get up and do some exercise. That helps me get my mind into the day and into whatever time zone I might be in. Running is a great way for me to get out and see the cities I’m visiting and to soak up the sights, smells and atmosphere of wherever I am.
Professionally, I really enjoy working with teams of smart, passionate people and seeing what can be achieved when you work collectively to get things done. I’m constantly learning and that’s very fulfilling. I like to explore new frontiers, new possibilities and remove barriers to progress. In science and in the healthcare industry, you’re often living five or ten years in the future and I really enjoy that. When you consider how much we’ve achieved in healthcare just in the past few decades, it’s exciting to consider where the next years will take us.