I'm going to pick on Medivation because they are new and claiming success. The cargo this cult is hoping to get is a therapy for Alzheimers. The drug is called Dimebon(TM), and it has a 20-year record of human use and demonstrated efficacy in animal studies of both Alzheimer's disease (AD) and Huntington's disease (HD). It began in Russia as an antihistamine drug and graduated to AD and HD applications.
The drug itself seems odd. For the Cargo Cult Scientists purposes let's just assume that it is a widget. What it does or doesn't do is, for now, not important. This post is about the Cargo Cult that is biotechnology. Medivation has followed all of the biotech forms. These include:
Step One: Get a CEO and a board together. Quite often the CEO will be a person with an M.D. and a PhD. That means they piled on the education only to find themselves sitting at a desk and working as an MBA. In spite of the heaps of degrees the CEO has not developed any products. He buys them in the form of "licensing technology".
Board members must come with impressive credentials. Whenever something happens around them they work hard to get their names attached to the acheivement. This goes on the website to impress the investors.
Step Two: Get money! Here is where the science educations come in handy. The investors most often do not understand the science terms being used in the presentations. They can thus be easily hoodwinked. They don't want to appear stupid. If the scientist says he's got a cure for a disease he must. What matters to the investor is the business plan and the profit potential.
Step Three: Hire a staff. Most important members will be the CFO, the COO and other executives. The CSO must be a "team player". Science can be a tough customer. The CSO must be able to work around it and sell the company line. The financial and business people will do what they do but they will soon come to identify themselves as biotech people. The science staff will be around to give off the illusion of having an R&D program. Investors want to know that there is more than one egg in the basket. This covers that fear. PhD scientists will be stationed in cubicles and people with bachelor degrees or less will work in the lab. The web site will be covered with pictures of these people. Occasionally the CEO or a PhD scientist will borrow a white lab coat and have his or her picture taken in the lab for PR purposes.
Step Four: Sell the potential. Most biotech companies will never make a dime. They will take a lot of money out of the pockets of the investors never to be seen again. At all times a company most be presenting to some organization that matters. These presentations and the quarterly company meetings will predominate the press releases. The idea is to keep people minds off of the science and the results. Eventually there will be an announcement that a drug trial is going forward or being ended. Most often they will end. These are tough days for the executives but that's why they demand the high salaries. It's a stressful job.
Step Five: Seek out bigger partners. Sign deals that include milestone payments. Hundreds of millions can be made without ever getting a drug on the market if you can play it right.
The day to day practices involve keeping investors pacified. All companies will eventually have investor relations departments. The stock price is the ball that everyone must keep their eyes on. This also keeps the eyes away from the science.
That's it for today. The next post will discuss the day the planes are expected to arrive. This is a day that all executives must understand and be ready for. There are ways of talking and tones that need to be perfected so that failure does not catch you off gaurd. Stay tuned.
P.S. I didn't forget about Medivation. I will go into details of the above steps using Medivation as my Cargo Cult. Trust me, this will work.
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