First BIO President Carl Feldbaum Remembers Early, Existential Struggle
Carl Feldbaum was a law student of Arlen Specter at University of Pennsylvania Law School in the 1960s. When Specter became Philadelphia’s district attorney, he hired Feldbaum as an assistant DA. When Pennsylvanians elected Specter to be their U.S. Senator in 1980, he hired and promoted his former law student to the position of chief of staff.
Feldbaum had been the top staffer of one of Washington’s key dealmakers for four years when he came across a job posting in 1992 for President of a new trade association representing the nascent biotechnology industry. Having studied biology as an undergraduate at Princeton University, Feldbaum saw an opportunity to mix his political and scientific passions and help innovate a new organization – and a new industry – into maturity.
He immediately applied for the job, but the recruiter called back to tell him his résumé had arrived too late. Six finalists had already been identified. In fact, they were interviewing with the board-level search committee that day. Feldbaum’s disappointment was short-lived. The following day, the recruiter called back with the news that the Board had rejected all six. Feldbaum got the interview … and got the job.
He led BIO through its formative years, growing the organization right alongside one of America’s most consequential emergent industries. From navigating the early ethical debates that posed an existential threat to biotech’s existence to “lobbying” members of Congress by calling into local radio shows in their districts to securing Senator Bill Bradley’s support by helping his former NBA rival with bad knees, Feldbaum built BIO over a dozen years by adopting the same approach that animated his new industry client: He innovated.
BIOtechNOW: Tell us about your initial mandate as BIO’s first President.
Carl Feldbaum: I came on board the day of Bill Clinton’s inauguration in 1993. My mandate was to get us on the political map, pronto. It was quickly announced that Hillary Clinton would be in charge of revamping our health care system. They didn’t intend to target us. There was no evil intent toward us. But that health care plan would have affected us in major ways, and could have killed us in the womb.
How did you approach the Clinton administration in 1993, and what were your concerns with their health plan?
Somewhere in about 1,500 pages of that health plan, there was a page establishing a so-called “breakthrough drug” panel to review prices of innovative medicines. The panel had the authority to set prices on new treatments and cures for diseases. We didn’t take a position on the entire health care bill, but we came out hard against that panel. No one would invest in a new biotech breakthrough if the government was authorized to set the price.
There was no ambiguity in the bill. It put a target on our backs. What was not nearly as clear was how to go about responding to the threat. We knew that the value that our new industry would add was about a lot more than “me too” drugs. We were an unknown industry seeking breakthroughs for unmet medical needs.
Can you talk a little about the merger that gave birth to BIO?
You had one organization that represented the so-called large companies – which were really not so big at the time – essentially, Genentech Celgene, Amgen, Genzyme and Biogen. You had another organization that represented the startups. Both had agreed to merge and had come up with a blueprint.
Big Pharma did not take us seriously. They disparaged us at first. They were largely governed by chemists. But a couple of Big Pharma CEOs not only joined us, but they truly “got it.” They understood that biotech would one day be driving the policy bus, testifying before Congress and leading the industry forward.
The biotech industry needed its own identity. Big Pharma had been lumped with Big Tobacco and nuclear power. It was clear to anyone with the wit to look at it that our playbook had to be different. The Big Pharma folks resisted. I had CEOs frothing at the mouth at me, angry at our positioning: “Your BIO is creating miracle drugs and we’re just redoing aspirin.” Some of them did not understand that the rising tide of BIO could lift their ship.
How big was your original staff, and how did you help BIO grow?
The whole staff was maybe a dozen. There was so much ground to cover for very few people.
Only a handful of our members had government relations representatives in Washington. Covering Capitol Hill in any fashion was not possible. Our organization didn’t have any money. We couldn’t compete with the health care lobby. We chose not to have a PAC [political action committee], because it would only demonstrate how small and poor we were.
We had to resort to innovative techniques to get the attention of Congress, the executive branch and the media. We had an immediate advocacy challenge in front of us before we had even built the entity and could attract a membership. So BIO itself became something like a political candidate. I rented a car and traveled up and down the coasts visiting biotech companies and enlisting members. I spoke to any member of the press – local TV, county weeklies — that would have us. I explained what biotech was and why the breakthrough drug panel could cripple us before we had reached infancy.
I’d go to Atlanta and talk to the Journal-Constitution, and I’d go into Cobb County and give an interview and talk about Newt Gingrich’s importance. We knew members of Congress all read their local news clips religiously. So I’d talk to county biweeklies and mention members of Congress who were for or against us. That would get their attention.
I could be in the office in Washington, and my communications person would arrange a call-in to the most popular radio talk show in a Member’s district. It could be the Akron, Ohio, morning or evening rush hours. I might be reaching 6,000 people in their cars driving to or from work. The talk show would start by asking what biotechnology is. Sometimes they’d ask me to write the questions for them. We were like a new candidate running for a seat at the table. This was the first time biotech spoke with a single united voice.
We also had to deal with state legislatures, which were being influenced by crazy stories about us. In those days, movies like Jurassic Park and Gattica would start waves of ignorance and lead to legislation at the state and local level. People were worried about cloned human beings. Places wanted to denote themselves as “genetic engineering-free” zones. We had to cut those off at the pass before they went viral.
How did you approach creating incentives for investors to spend all that money on a payoff that was both unlikely and many years away?
I remember I went to The Woodlands outside of Houston, Texas. They had a couple of promising biotech companies and ambitions for a larger cluster. But the mentality in Houston was largely based on oil and drilling, where in eight weeks you know whether you’ve hit or not. How do you explain waiting 8 to 15 years? Well, that’s biotech. There’s an underlying expectation with short-term investors that’s not suited to what we do. Of course, one of the ways you build long-term confidence on Wall Street is to be honest and avoid hype and promises that may be unlikely or far off.
What were the ethical debates happening around biotechnology in BIO’s early years, and how did you approach overcoming those objections?
We didn’t run from this. We embraced the societal debate. I can’t tell you the number of times I went on CNN and other outlets to answer questions about bioethics. I said, “Embryonic stem cells were the toolkit to meet unmet medical needs. But it’s not our ambition to clone a human being.” And I made it clear that we’re serious about thoughtfully addressing the ethical issues that inevitably come our way.
Dolly the Sheep was on the cover of Time Magazine. One of our members, a Scottish company, neglected to tell us they were going to make the announcement that the first mammal had been cloned. It was a case of false modesty. They didn’t think it was that important of a discovery. They told us they had named Dolly after Dolly Parton because the cell had been cloned from a mammary cell. That wasn’t helpful.
BIO created our own bioethics committee chaired by Steve Holtzman. It was not a matter of tolerating the ethical issue. It was a matter of embracing and dealing with these questions as fellow concerned citizens.
President George W. Bush’s compromise [on therapeutic cloning] didn’t stop us from doing what we needed to do, so we didn’t make it a bigger issue than it needed to be. However, dealing with religious fundamentalists was a challenge. We held numerous focus groups in rural communities to get a realistic inkling of their perspective. I was on the other side of the one-way glass listening, watching people’s body language and trying to understand their tolerance for progress in the genetic realm. It was a fascinating exercise.
Whether in rural Kansas or Virginia, if you did “genetic engineering” to cure a disease or fix a major disability, they were OK with that. If you were trying to increase intelligence or change physical attributes, they were against it. Some people were just against all of it and couldn’t be moved. So you had to respect their faith-based beliefs.
Those focus groups informed our communications team about the third rails and land mines that must be avoided. It helped us express what we truly intended to do: treat and cure disease. These were important lessons. Our industry back then could have been torn out by its roots.
In terms of actual commercial products, how far along was biotechnology in the first decade?
We had to deal with some early-stage clinical disasters. In the early days, we weren’t dealing with clinical triumphs. We were dealing with serial failures. We tried to downplay the hype regarding the pace of new drug development. There were these spectacular media stories [that] other industries may have welcomed about genetic cures right around the corner, about new enzymes that can cure the incurable. We underplayed it. We talked about potential.
We said the Human Genome Project is not going to lead directly to cures for devastating illnesses afflicting human beings. Not yet. This is not easy – the reality of creating cures, step by step. There was progress, little by little and step by step. Two steps forward and one step back, we managed to build the entity.
Can you talk about the decision to add an industrial & environmental section to BIO in 1998?
Toward the middle of the 1990s, environmental remediation became an issue because of Superfund sites and the discovery of various ways to use living organisms to digest waste products. That’s where industrial biotech began. Brent Erickson came on, and we established a fledgling industrial section.
We discovered, somewhat to our surprise, that there was an unmet industrial representation need. Suddenly, biofuel companies joined. They wanted to enjoy the benefits of progressivism and the novelty of clean energy and clean remediation. We had an open opportunity, and we were the only unified voice on these subjects.
And across the board in biotech, we established a business development unit to provide opportunities for the young startups to meet with the big guys about partnerships. We started out in New York and Seattle and San Francisco. Then we expanded to Frankfurt and Singapore. Now, every week, there’s a biotech meeting somewhere in the world.
What was BIO’s first really important victory?
If you want a victory, we survived. We created a coherent industry around a couple of paragraphs in a [health care] bill that did not pass. I’m not sure that counts as a legislative victory. But we survived infancy to actually grow into adolescence and now young adulthood. This happened through membership building and by establishing media, legislative and executive credibility.
For BIO staff, there was a real excitement about being a part of a startup. That’s what we were. Not just a startup company, but a startup industry. There was something thrilling about it. There were no weekends for us. There was no summer for us. We were at it all the time. We believed. We loved it. We had fun doing it.
Was it hard to win converts on Capitol Hill?
As former Speaker Tip O’Neill said, “All politics is local.” But it’s also personal. To the extent that we could find out about a particular Member’s personal interest in a specific disease – because of a family member or key constituent – we’d focus on that.
I once took a group of New Jersey biotech CEOs to see Senator Bill Bradley. He was already very knowledgeable. He said, “I know about biotech’s back story. What do you have for my friend John Havlicheck’s knees?” Havlicheck was a 13-time NBA all-star for the Boston Celtics when Bradley played for the Knicks. They had stayed in touch. Havlicheck was in great pain from a lifetime of basketball. We found a clinical trial in Canada for a product that might benefit him, and Senator Bradley was grateful.
As we left the office, one of the CEOs said, “I didn’t get to tell my company’s story.” I said, “You don’t understand. That’s the best outcome we could have possibly hoped for.” Bradley remained a supporter throughout his Senate career and supported New Jersey’s ambition to create biotech cluster.
There wasn’t the left-right divide we have today. There wasn’t hyper partisanship. We dealt with everybody. You had religious fundamentalists with objections. But you also had to deal with the purest form of ignorance: Very few members of Congress had any background in science. They didn’t know what biotechnology was. During the controversy around Dolly the Sheep and cloning, I’d have to start by explaining, “There’s an egg and a sperm… and this is not exactly like that…”
We didn’t have pricing issues. We didn’t have many products. We had promise. We had hope. We didn’t have many side effects or newsworthy negative outcomes from clinical trials. We didn’t have the issues of a mature industry. We were in our infancy. We had a relatively clean slate.
How does it feel to be celebrating the 25th anniversary of BIO?
It feels really good. When BIO was established, it was more than doubtful that we’d be having a conversation about a 25th anniversary. There were many existential threats to our industry in those early years, but we avoided bad policy that would wipe us out. It’s a fortunate thing, because this isn’t about selling widgets. This is about making great progress in a human endeavor. I believe that in 100 or 200 years, people will look back at this time as a renaissance in science and medicine.