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G. Kirk Raab, Genentech, 1993-1995
If any firm could be said to be biotechnology's flagship, it would have to be Genentech. The company was among the first biotechs founded, in 1976, by Robert Swanson, a legendary venture capitalist, and Herbert Boyer, one of the two scientists who pioneered recombinant DNA techniques in a landmark 1973 study.
Genentech introduced Wall Street to the promise of biotech, with a 1980 initial public offering that shattered records, and in 1982 won the first approval of a biotech drug product, recombinant human insulin.
Thus, it seemed only natural in 1993 that Genentech's CEO, Kirk Raab, would be the first chairman of the newly created Biotechnology Industry Organization.
As a board member of the Industrial Biotechnology Association (IBA), Raab had supported the move to create BIO by merging with the Association of Biotechnology Companies (ABC), which primarily represented smaller firms, academic centers, and support services.
"It was clear to a group of us in the two organizations that we were almost in conflict in the eyes of the people in the administration and on the Hill, and maybe among the public as well," he said.
Although the merger solved some important problems, it created some smaller ones. "The challenge was to keep it cohesive and make sure the less powerful, smaller companies didn't feel they were being undermined. We worked hard making sure the ag people, the smaller, newer companies, the industrial parks and universities all continued to feel part of the organization, and did not feel dominated by the IBA. The ABC leadership, particularly their chairman, Tom Wiggans, played a key role."
That approach posed some risk, however, of alienating large companies. "The big companies, both the large pharmaceutical and biotech companies, in the end were paying a big, big portion of the cost of the organization, and yet they had to recognize they had only one vote," Raab noted. "Both officially and unofficially, their voices were the same as everyone else's. Keeping all that together was not easy."
Fortunately, the biopharmaceutical world was a small one and tensions were minimal. "Having come from Pfizer, Beecham and Abbott, and as a member of PhRMA's [The Pharmaceutical Research and Manufacturers of America] Executive Committee, I knew all the CEOs personally," said Raab. "We kind of grew up together in the business, and we recognized that the goals of biotechnology were largely the exact same goals of pharma."
The message from the melange of firms that constituted BIOhad to be simple: "We were the good guys."
"We sought to learn from the mistakes of others and make sure we were seen as a supportive organization and not an antagonistic, self-centered organization," Raab said. "We knew we would need to convince influential people-the administration, the press and so on-that one of our key goals was the public's health and that this was not purely an industry lobbying group."
BIO was immediately tested with the debate over the Clinton health-care reform package. Raab, though an early Clinton supporter, was appalled when he learned the details of that plan. "The fact was that you were basically creating a socialistic decision-making process in health care, with price controls and drug selection. All the aspects said that Big Brother was more capable than individuals of making decisions."
Raab sighed. "Clinton had a wonderful opportunity to make a difference in the U.S. and failed."
The plan's failure wounded an ambitious administration, but for BIO it proved a boon. "That debate turned out to be the single most positive event for biotechnology in its history, even though it was a sad and unfortunate decision on the part of the Clinton administration to do what they did," said Raab. "It brought BIO's leaders close together, and we became a lobbying machine.
"This is where [BIO President Carl Feldbaum] really became the man," said Raab. "It was just his cup of tea. He gave us a powerful face in Washington. We were the poor start-ups, and we just used that image beautifully and legitimately to stop and beat down that extraordinarily bad piece of legislation they proposed."
FDA Reform Succeeds
BIO's early years were also dominated by discussions with and about the FDA, then undergoing one of its most radical overhauls in history with the passage and implementation of the Prescription Drug User Fee Act (PDUFA), which was followed in the mid-1990s by extensive modernization reform, first administratively and later through legislation.
"We decided we were not going to be antagonistic with the FDA," Raab said. "After all, the FDA is the future of biotechnology. We needed to learn to work with them, live with them, help them and support them at budget time, in ways that we could, legally and appropriately. The first goal was to see what could be done to improve review process time and quality, particularly for BLAs [biologics license applications]."
Review times fell by half during the 1990s, and dozens of BLAs earned approval over the period. PDUFA was renewed in 1997 and 2002, and Congress passed the FDA Modernization Act in 1997. BIO worked closely with legislators and agency officials on the design of all these initiatives.
Despite the advances, Raab eschews complacency. "We made some progress with the FDA, but there are still a lot of things at the FDA that need addressing, and hopefully with the new commissioner aboard, that can happen now. They made giant steps in the '90s but have slowed down, and I would like to see more progress."
Jurassic Park Syndrome
Whether in 1993 or 2003, a central part of BIO's mission has always been to respond to wild stories-fact or fiction-about biotechnology, and in 1993, the movie Jurassic Park stamped a massive footprint on the American imagination, Raab recalled.
"In 1993 and 1994, some of the thinking about biotechnology was antagonistic," he said. "There was fear of the Jurassic Park Syndrome, and we needed to make sure the leadership in Washington, and in the public and influential press, didn't think biotech and genetic engineering were things to be afraid of, but that these technologies were a tremendously positive thing for humankind.
"During that period, we developed successful programs that rationally conveyed how biotechnology works and how industry uses it to develop products that meet real human needs."
'Good Times'
By the end of his tenure in 1995, Raab had accomplished most of his goals as BIO's chairman, with the exception of enactment of new tax incentives for biotechnology. "The tremendous opportunity for biotechnology tax incentives is a giant thing this country missed completely," he said.
(Most biotech companies are as yet unprofitable and, therefore, do not benefit from the current research and development tax credit. This year, BIO is renewing its push for a new biotech-tailored tax credit.)
Overall, though, Raab is pleased with the organization's responses to its early challenges and its fast growth, exemplified by BIO's 1995 annual convention in San Francisco.
"These meetings have gotten bigger and rather amazingly successful, but back then we were just two years old, and this was the first really gigantic meeting," said Raab, recalling "the spirit and commitment to biotechnology, the belief in it. The economy was good; the markets were rising. These were good times in every respect. It was a heroic moment, to see that very large organization sitting there and to see what we had created in a very short time and what a positive force it was.
"It's also wonderful that even with the industry's financial challenges, BIO continues to be a powerful force in ensuring our industry is recognized for its unique value, growth and the fact that more and more people benefit from our science and resulting products."
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