The Antidote: Inside the World of New Pharma (19 page)

It wasn’t a company killer. It wasn’t we have to keep this going because this is all we have. But that made it even tougher. This was a program that was being run at the thirty-five-million-a-year level for which suddenly the whole bill was ours—unexpectedly. It doesn’t matter if Lilly says publicly that they’ve canceled all their infectious disease programs. Everybody thinks that they wouldn’t cancel anything they thought was valuable. So you have to convince Wall Street, convince the board, convince everybody, that it didn’t matter what Lilly said, this was worth finding thirty-five million a year to keep going, knowing that it was going to go to a hundred million real soon. And why
this
? If we had that kind of financial resources, why didn’t we put it behind something that wasn’t tainted that way. The typical biotech thing to do was to say, “Well, we’re putting this program on hold until we find another partner”—which would have happened. Instead, we just went full speed ahead.

Mueller prides himself on his Bavarian understatement. He knew better than anyone else, including Boger, the full implications ahead for the organization, and he admired the courage it took to take on the risks. Boger often told people that he wanted Vertex to be the most feared pharmaceutical company and the most fun pharmaceutical company: feared because of its fearlessness, fun because it was more exciting to dare, excel, and win against all odds than simply outperform your rivals. Sato thought the combination derived from the fear of falling short of one’s sacred ambitions, of not being good enough, and the deep personal pleasure and raw thrill one takes in an almost psychedelic level of hard work and engagement in several major challenges all at once—at life, exultant, breathing hard but evenly, on the cutting edge. Even at the bottom of Vertex’s fortunes on Wall Street, she recalls, “The Kool-Aid was strong.”

“So we made this commitment that we could solve all those problems and do it,” Mueller says. “That was actually the fundamental moment when the decision was made: ‘Okay, we do this drug, and along the line we build an organization to make it all happen.’ This is one of the boldest moments that I have seen from a corporate decision-making point of
view. I must say I give kudos to Josh and his guts. He stood up and said, ‘Yeah, we do this.’ ”

As the second quarter advanced, Vertex management regrouped while making the sort of partnership deals that the company, now more than ever, needed to do to survive. Although it had more than $460 million in cash, Smith expected a net loss for the year of $140 million to $150 million, meaning its balance would soon drop near $300 million. Despite better-than-expected royalties from Lexiva, at its current burn rate the company had two years or less before it ran out of funds. Losses as far as the eye could see, the founding promise of all biotechs, had started to add up to real money, ratcheting up pressure on the executive team.

In May the company announced that the Cystic Fibrosis Foundation would pay $21 million in direct research funding for the next two years. Bob Beall, pleased that Vertex had proved it could find small-molecule compounds that corrected the defective ion transport in the lab, was eager to subsidize its late-stage drug discovery effort. As Aldrich had predicted, Vertex’s full commercial rights in CF—a so-called orphan category since it has so few patients, and which affords, among other inducements, accelerated time frames to approval and superpremium pricing—looked more valuable now that development deals with big companies had lost much of their allure for both sides.

Sato scrambled hard to find a limited partner to subsidize the work in HCV, one that would deliver near-term revenue and supply badly needed development support while the company geared up VX-950—and itself—to conduct large-scale human trials. She was under the gun to bring in something fast: the first human study was scheduled to start in June. With Boger uncharacteristically staying out of the discussions, she approved a $33 million collaboration with the Japanese drugmaker Mitsubishi for development and commercialization rights to the drug in the Far East. It wouldn’t cover the bills but it was something. Vertex retained exclusive rights to the rest of the world.

In mid-June, the day the agreement was signed, VX-950 was given to the first of thirty-five healthy volunteers in Europe to test its safety, tolerability, and pharmacokinetics in an early-stage dosing trial. That
morning in Cambridge, chemical engineer Trish Hurter, forty, joined Vertex, taking over its formulation group. Hurter, compact and hugely energetic, a spirited horsewoman, was from South Africa, having gotten her PhD from MIT before migrating into and out of the paper industry, having two children, and managing, most recently, formulation development at Merck. At Vertex, where most discussion galloped along like the dialogue in
The Social Network
, Hurter was instantly in a speed class by herself: “Walk fast, talk fast, ride fast, drive fast, type fast,” she explains. She adds, in another context: “Shit happens, move on.”

What the start of human testing signified is that VX-950 could be coaxed, despite being less soluble than marble, into a state where it could be taken orally, get through the digestive track, and be absorbed, three to four hours later, through the lining of the small intestine and into the bloodstream. What the experimental subject got was not a pill but a cloudy suspension made in a beaker from ingredients stable for only a day or so. Concentrations detected later in the blood were a measure of how much reached the plasma—the exposure rate.

VX-950 “loves being crystalline and loves hanging on to itself,” Hurter explains. After two years and many millions of dollars, Vertex chemists had developed a process to keep it from locking into a lattice by melting it at high temperature, then infiltrating it with polymers as it flash-cooled. The polymers, like infinitesimal chains of pop-beads, mingled with the drug, diverting and delaying the atoms from reconnecting long enough for the substance to be absorbed. The process plainly worked, but yields were scant and unreliable and results erratic, swinging from batch to batch.

“They had done this tox study in Arkansas in July, and the exposures they got from dogs were really bad; way worse than they expected,” Hurter recalls. “Then, a little later, in one of the multiple-dose panels in humans in Germany, they got almost no exposure, even though they’d been getting good exposure before. They’d thought they had stability for twenty-four hours, because that was the data that people had generated in February in Boston. There had been a heat wave in Europe, so the general hypothesis was that the drug was crystallizing. We didn’t know what was going on, basically.”

Hurter dug into the chemical process, an amorphous system like glass in which the drug substance is kept in a jumbled-up state that prevents it from finding itself and crystallizing. She hadn’t worked with an amorphous system before. All Vertex could spare for her experiments was two grams of the drug. Her group was supposed to have thirteen people, but the previous director had left during the winter, taking a couple of chemists with him, and within two weeks after her arrival, it was down to five. Unwilling and unable to wait until she could conduct a more thorough search, she hired two temps.

“The chaos was intense,” she recalls, “but fun. Nine-fifty is definitely way up there in terms of challenging molecules. Merck didn’t have anything like that in their repertoire at the time. It’s insoluble in everything; it’s not even soluble in solvents. All the normal things you do just aren’t enough for it. It’s big, so it’s hard to get through the GI membrane, but to get it through the membrane, you need high concentrations; and yet it’s hard to get it soluble—you’ve got to work on both aspects. It’s also very difficult to make and very expensive to make. They had twenty-two steps with really low yields. All kinds of hazardous process steps. A real bear.”

On a site visit to Aurora, she found herself in a car from the airport sitting next to physical chemist Pat Connelly. One of Vertex’s early scientists, Connelly had come to the company straight from a Yale postdoc, and within five years he had left to start his own structure-based discovery company specializing in antibacterials. After selling that business and starting another, he’d returned to Vertex earlier in the year. Thomson and Murcko had asked him to help develop its CMC (chemistry, manufacturing, and controls) environment. He and Hurter discussed the problems with VX-950 for five hours during the flight back from San Diego.

Connelly appreciated her urgency, especially regarding the minimal human exposure during the Phase Ia trial in Belgium. It wasn’t hard to imagine the sheer unacceptability of Vertex heading into its first trials with VX-950 in infected patients, scheduled to start on November 1, with a drug that couldn’t be guaranteed to show up in the blood. Connelly had spent much of his early career investigating the effects of heat on the bonding of proteins and small molecules, using a supersensitive
calorimeter that can measure temperature differences of a millionth of a degree. The machine was still in the lab.

“I said, ‘Listen, we don’t have a good way to detect how this amorphous suspension is going crystalline, but it’s a phase change; there should be heat involved. Let’s put it in this calorimeter and see what happens,’ ” Connelly recalls. “So that’s what we did. We knew it would crystallize; the name of the game was how long would it take. Sure enough, we saw a little blip. It took four and a half hours to complete.”

Investigating further, Hurter learned that the Belgian clinicians had waited almost the full twenty-four hours before mixing the suspension, meaning that the VX-950 had crystallized long before the patients drank it. Reassured that the compound was stable long enough to make the transit reliably from mouth to small intestine to bloodstream, but was highly susceptible to heat, they designed a temporary solution: VX-950 needed to be kept refrigerated, and then mixed with water and shaken, not stirred, in an air-conditioned room right before it was administered. “The James Bond protocol,” it was called. By early fall, Hurter’s group had a formulation sufficient for the Phase Ib trial: a few dozen patients, fourteen days. But getting from there to making a pill that could sit on a pharmacy shelf anywhere in the world until some far-off expiration date remained another order of challenge entirely. Adding two more chemists in October, she bolted ahead.

For a year, prompted by Smith’s and Ken’s dire warnings, Boger had strengthened Vertex’s business. The company added two more knowledgeable, experienced directors to its board: a former vice chairman and president at Pfizer and a former US assistant secretary for health, whose combined expertise, contacts, and profiles might help steer the company through the regulatory process. The week after announcing the Mitsubishi deal, it signed a global collaboration with Merck in cancer research, delivering $34 million in up-front development support for its lead kinase inhibitor, $350 million in BioBucks, instant vindication of the Novartis restructuring, a sense internally that the company was emerging from its doldrums, and deep personal benediction and satisfaction for Boger.

Merck remained the industry gold standard, however tarnished by the recent reversals to pharma’s image. With drug prices skyrocketing, the sector had fallen further, faster in public esteem in recent years than any other industry in history, according to polls showing that Americans now viewed drugmakers as on a level with tobacco companies. Former Merck chairman Roy Vagelos, noting the “exorbitant” costs of new medicines and “galloping” annual hikes of old ones, predicted a reckoning, again raising the specter of government price controls, as he had done during Clinton’s first term a decade earlier.

With pharma spinning, Boger could see more clearly the opportunities for changing not only the way drugs are discovered but also how they are developed and sold. The awareness startled him, coming as a kind of secondary revelation, since when he started out, it hadn’t crossed his mind that Merck and its peers could topple so rapidly.

Ken recommended that Boger meet with a former client of his (Ken’s), an independent Boston management consultant named Bink Garrison. Most pharmaceutical CEOs confronted with questions about the direction of their business in a changing market rely on McKinsey & Company, the consulting giant, which had helped build most of the top ten prescription brands and supported nearly all the largest mergers within the industry. Garrison, a former advertising executive, counseled McKinsey when it wanted to develop
its
business, and he worked primarily with Fortune 500 companies. After graduating from Princeton University in the 1970s and a stint as a nuclear weapons officer on a navy submarine, he’d started his career as a copywriter. Tall, lean, soft spoken, he favored bow ties and other WASP accessories, though his everyday speech combined what he calls “the adman’s bag of tricks” with an incongruous, hipsterish patter. Garrison dressed like George Will but sounded like Don Draper channeling Allen Ginsberg.