Genesis Pharma S.A.

My contact with the pharmaceutical sector started in 1985, as Managing Director of Welcome for Greece and Israel, where I worked for ten years. Before that, I had just finished my post-graduate studies at London Business School, in Business Administration, from 1983 to 1985. Before that, I worked for Pepsi Co in Athens, for four and a half years, right after finishing my studies in Economics, in Athens University (ASOEE).

You ran Welcome for 10 years, until its end as a self-existent company, in 1995, when it was acquired by Glaxo. Which would you say was the hub in your carrier?

Leaving Welcome left me with a number of choices, but I had decided to take all the necessary time in order to make the right choice, because I knew that the next step should be the right one. In my carrier, I already had 10 years' experience in top management position, as Managing Director of Welcome, I was 42 years old and I knew that my next step should have at least 10 years horizon.

How did you decide to resign from the highly top position of Managing Director, which however was a clerical position, and take the responsibility to create a company from the beginning?

Everything started during a business meeting with the Jacovides brothers. With Alexandros Jacovides we were schoolmates in Cyprus. Jacovides brothers are active in pharmaceutical business in Cyprus and hospital materials business in Greece. They wanted to expand their activities in pharmaceuticals in Greece, I wanted to start something new and after a lot of discussions we realized that we shared the same culture and philosophy and decided to cooperate in establishing GENESIS Pharma, a company focused in biotechnology.

There have been 6 years since then. And within 6 years your turnover is so high that you are considering your share listing on the Athens Stock Exchange?

We have achieved strategic alliances with top biopharmaceutical companies worldwide: Amgen, Biogen, Chiron, Cephalon, Shire, Vifor and Guilford. If we look at the board of NASDAQ biotech companies' capitalization, we will notice that these companies are the largest biotechnology companies in the world, with very important and innovative medicines. It's worth noticing that Amgen is the 8th largest company in the list of the top pharmaceutical companies and the largest biotechnology company.
It is important to say that Amgen's capitalization is bigger than the sum of all European biotechnology companies' capitalization.
Our initial success was the Agreement with Biogen for the distribution of AvonexR in Greece, signed in 1997. Avonex received price approval on December 1997, when we dynamically entered the market. We had a very good product, we made a very good team and in just three months we managed to become market leaders.

I believe it was due to the successful pre-marketing, the selection of an excellent management team, enthusiasm and everyone's commitment for the best possible result. We were strongly connected from the first day, shared a common vision and thus, created a new "market space" in the Greek pharmaceutical market.

Is this commitment and enthusiasm related to leadership, the natural way a Manager "is looked upon"?

(laughs) This is something you have to ask the managers yourself, but I believe that it is. What was very important was that since we had the experience and good market reputation, it was not so difficult to attract top talents in GENESIS Pharma, a new company just starting its business activities. It is generally difficult to attract top professionals who already have experience, high wages, bonuses, company cars etc, from other international pharmaceutical companies into a new company that only had a 100 square metres office, but we did it. We made those people believe in our vision and we did not disappoint them.

It's more about managing human resources. We give great importance to our employees' recruitment, we want them to share our common vision, to believe in success, to be committed and consider their company as it was their own. We want them to feel like home of GENESIS Pharma and come here smiling and enthusiastic. We believe success has to be fairly shared and wages have to follow the results.

Do you allow latitude to your partners, that is, do you allow them to express their opinion?

I absolutely do. I give them the freedom to handle all issues concerning their team and product the best way they can. From the moment the annual budget gets approved, it is the managers' responsibility to succeed, being completely independent. I, from the other hand, am always available, wandering around so that all employees can see me any time, without of course interfering in their everyday work, in Business Unit Managers' work.

Is this the most appropriate and modern organisational model? Is there another model of organising a company for success?

In my opinion, a business does not need many managerial levels; it needs small, flexible structures. Business Units is a model that can be applied in many cases but that doesn't mean it will always be successful. If that was the case, we would all follow a specific model and we'd all be successful. Success also depends on your product portfolio or the team that runs the project. Regarding the organisation structure, I like to shuffle the cards and I always try, with the people available, to make the best organisation scheme. We rotate people among Business Units very easily. We also provide our people with the opportunity to show their abilities in more important issues. There are already numerous employees who have been promoted, but this seems natural for an evolving company. We started selling in 1997, and in 2001 our sales reached 19million euros, a rather large number for a five year old company. Our sales in 2002 are expected to peak at 35million euros while in 2003 they are expected to exceed 60 million euros.

How would you explain the trust you received from such huge biotechnology companies to provide you with such great products?

We are always very well prepared for the meetings, the presentations to our prospective partners, we study the market of the product we're interested in and prepare detailed business plans. We use all means of information available - Internet sites, Reuters, conferences, magazines etc.
Then, when we get the chance to prove our capabilities, our team become the ambassadors of our trustworthiness and quality. Furthermore, since most of the people working in the biotechnology companies are young people, most with MBA degrees from the big European and American Universities, my partners and I feel that we can communicate perfectly with them.

Well organised and accurate work, and above all high principles, integrity, long term scheduling and a high morale. We learn from our mistakes and always look ahead, besides who has ever been successful by living in the past?

GENESIS Pharma does not appeal to large teams of doctors but to target groups? Shall I presume that you don't target to cardiologists, pathologists, etc?

No, and our initial target was to focus on niche markets and small target groups of doctors and patients.

No matter how novel a product is that targets a specific speciality of doctors and not a wider audience, is there a specific distribution model since there is such competition in this product category?

There is great competition but our competitive advantage is that we have a distinct Sales and Marketing team for all our products. Additionally, we are always close to both the patient and the doctor.

Yes, we have made significant steps towards supporting the Hellenic Association for Multiple Sclerosis.

Does that imply that you interfere in supporting those patients by other means as well?

No, it does not. I believe that those patients have done a terrific job with their Association and we try to assist them through it. GENESIS Pharma took the initiative and supported the anthology "EMEIS", which is exclusively consisting of MS patients' literary work and artworks. It was an initiative our company aimed to fund, through the promotion and selling of the anthology, the Hellenic Society for Multiple Sclerosis and promote their mission. In order to support this event, there has been a comprehensive presentation of the anthology and the Society's task and mission, in exhibitions that took place in the Athens and Thessaloniki Concert Halls, and in other Greek cities.

What is your opinion on the way that medicines are promoted, do you believe it is ethical? The role of the medical rep as a carrier of knowledge and information, justifies the term?

I wouldn't like to comment on the way other companies' way of promoting, I don't follow it anyway, but regarding our way of promotion we believe it is done with proper and scientific documentation to the doctors and we want and should be as appropriate as possible.

Are the other kinds of provisions given to the doctors by the majority of pharmaceutical companies, of any concern to you?

No, they are not and we definitely aim to follow our own Code of Conduct, long before SFEE published its own.

Do you believe that in such a competitive environment (where doctors have been so used to receiving "gifts") a company like yours would survive?

Absolutely, both in the short and in the long term. The majority of GENESIS Pharma products are unique as they are biotechnology-derived, and would not have the competition an antibiotic would have. I believe that the best product and the best team receive its market share regardless of the "gifts" offered, which in their vast majority do not bear the desired results.

Given the fact that there are numerous products with similar or the same active ingredient in the market of "commodity medicines", what do you think the competitive advantage of a successful product is?

I don't believe I'm the most appropriate person to answer this question. It has more to do with the doctor.

No, at least not in the way we have structured our Business Units where the BU Manager is responsible for both the sales and marketing of his line of products, avoiding in that manner any frictions that existed in the past and still occur in many other companies, where it happens that two departments perceive one another as a competitor, whilst in reality they are filing out each other's gaps. Sales cannot exist without marketing and vice versa, in my opinion these are the two parts of a single department with the sole target to better promote our products.

Your employees, would you rather have people with a "hands-on" experience in sales or with degrees and MBAs?

We are mainly interested in people with "hands on" experience from multinational pharmaceutical companies when recruiting for the Marketing and Sales departments. Experience only is not enough though, it is very important that they have achieved outstanding results with their previous employers. The majority of our employees have MBAs from well-regarded universities.

I believe M&As take place all the time. Big companies will continue growing, becoming giants and will provide more opportunities for smaller companies (like ours) to be active in areas where big companies have no interest. Additionally, small companies can attract more new employees, which would rather work in a small company with a lot of perspectives that can provide them with more opportunities and flexibility.

It sounds like a "heretic" opinion, do you mean that it focuses on the small companies' interest whilst on the other side this wave of M&As creates big disappointment.

I believe that a lot of opportunities are provided, since the big companies in order to feed their growth will need more successful M&As. If research does not lead them to successful new products, the pressure from the investors will lead them to M&As. Even though I was part of one such M&A I felt that a right acquisition can result in very positive outcomes. What disappears though is a bright and historical name, as has happened in the past with Welcome, Beecham, Ciba Geigy, and Sandoz. Those names do not even appear in a sign, but that is also part of the game.

Where do you stand on blockbusters or on the immense funds paid for research, especially for gene therapy?

The research funds for new products and for gene therapies have now reached very large amounts of money. When $800MM are required for the research and development of a new drug, there are only a few companies that can afford it and even fewer that will bring good results. Now, if the results from their in-house research are disappointing or the cost is too high in order to proceed with further research, companies develop partnerships with other companies in order to share the costs and the risks of such an investment, thus creating new opportunities for smaller and more specialized companies.

Buying into a biotechnology company today in relation to how it was 10 years ago, is there a tremendous difference?

Absolutely, the amount of money required for such an acquisition is enormous. Additionally, there is currently a trend where a few biotech companies do not sell, they want to keep development in-house and become full bio-pharmaceutical companies, thus giving the opportunity to companies like GENESIS Pharma to take advantage of it and acquire marketing rights for more products in more countries. We have already expanded our operations in the Balkans and in Turkey. We have started a successful business in both Romania and Bulgaria and we aim to further expand in the rest of the Balkan countries.

Since our incorporation, we operated like a large corporation, even when we were only three people with a single contract and waiting for the price approval of AvonexR in Greece. We acted, all of us, like if we were part of a well organized big company. Our vision is to become the best pharmaceutical company in SE Europe through partnerships with the top biotechnology companies in the world.

Exactly, we started with a lot of ambition to develop the best pharmaceutical company, a company that would act as a role model and an ideal. I believe we have achieved many of our milestones today, we have significant presence in four countries and our sales in 2002 reached 35MM Euros. Our latest major achievement was the acquisition of the marketing rights of Amgen's GranulokineR from Roche Hellas. This product has already sold 18MM euros in Greece.

All functions did- organization, personnel, working environment, image. Image is not something you can acquire; you have to build it yourself, slowly and steadily and with very careful steps all the way. We managed to have a very good image both in Greece and abroad, we managed to identify GENESIS Pharma to biotechnology, the first biopharmaceutical company in Greece.

This is a new and immense area. I believe we can fight any genetic disorders easier and more effectively and achieve personalized medicine.

How do you see the market in the long term, will there be dramatic changes in, let's say the next five to ten years, will there remain only five giants?

There will definitely be many M&As but the number of remaining companies will be more than five.

Absolutely, even now there are a few under discussions between large US companies and I believe some of them will actually materialize. Perhaps in the following six months we will witness a couple of big M&As both in the areas of pharmaceuticals and of biotechnology. Currently, two are already in progress, that of Pfizer and Pharmacia and of Amgen and Immunex.

Nowadays we witness a lot a transparency and media coverage during M&As, how so?

A lot of press coverage is due to the pressure from the Stock Exchange and the wider use of the internet. The stock price of plenty big pharmaceutical companies is now low and there is a lot of volatility. Already a big US company hired consultants in order to find solutions to its problems - which means that it will probably start looking for a partner which usually result in an M&A.

Definitely a social good.

All this years that you have been involved in the pharmaceutical industry, what have you gained?

The satisfaction that we offer a better quality of life, and in many cases, more years of life to a lot of people that did not have it in the past. That is the most important gain for me.