Incyte CEO: Working hard to support R&D
HervÃ© Hoppenot is president and CEO of Incyte, a global oncology research company founded in Palo Alto, Calif., and headquartered in Wilmington’s iconic John Wanamaker building. Incyte has more than 650 employees. The average annual salary at the growing company is $125,000.
What do you feel is the most important thing Incyte does?
We are a company rooted in science. Scientific discovery is the core of everything we do – research and development drives not only our business, but our commitment to patients with cancer. We believe we can make a difference by developing and delivering novel medicines that will meet serious unmet medical needs.
Incyte is ranked seventh on Forbes’ 2015 list of the world’s most innovative companies. Congratulations on that. How many researchers do you have working to identify new therapeutics to improve the lives of patients with cancer or inflammation?
Almost two-thirds of our employees are dedicated to research and development.
How difficult is it to support basic research and development?
Our business model is based on a long-term investment cycle that supports the research and discovery of innovative products. With innovation there is also risk. In order to deliver on our promise – to patients, society, our shareholders – we need to ensure that we have a balanced portfolio of early and late stage products as well as income so that we can reinvest and continue to develop new, innovative medicines.
Incyte’s mission is to become one of the leading global oncology companies. Please give us a snapshot of what your company is working on now.
We have a clinical portfolio and pipeline that continues to grow and show great progress – through our developed products and clinical collaborations we have more than 80 ongoing clinical studies, both early-stage and pivotal trials in oncology, many of which are demonstrating promising results. We are also focused on growing our integrated commercial organization – building on our success and providing patients with two rare diseases (polycythemia vera and myelofibrosis) with the first and only approved treatment for their conditions.
Additionally, we have recently expanded our organization to include an office in Europe, which allows us to further establish our clinical and commercial footprint globally.
Have you discovered any workarounds to put more money into R&D or partner with others to get new therapeutics to treat cancer or inflammation into your pipeline?
We will continue to drive proprietary research and conduct our own clinical programs. In addition, our partnerships help complement our portfolio and extend our reach. Through our and our partners’ experience and resources we can better expand and support our R&D and commercial efforts in the U.S. and globally.
Turing Pharmaceuticals’ short-lived attempt to raise the price of their Daraprim from $13.50 per tablet to $750 per tablet brought Congress and critics down on the drug industry last year. A Gallup survey showed people rank pharmaceuticals 23 out of 25 industries, and drug prices have become an issue in the presidential campaign. How do you fund R&D without tipping the prices of your drugs?
Companies like Turing and some others have nothing to do with what we are doing at Incyte. The fact that they are naming themselves “pharma” or “biotech” companies is creating confusion and it is one of the reasons why our industry as a whole is sometimes not perceived positively by the public.
In the area of cancer, the biggest issue patients are facing today is the quality of their insurance coverage, as various mechanisms of co-pay or co-insurance are shifting the cost to the patients themselves instead of being covered by the insurance companies. Additionally, studies have shown that the majority of the cost of cancer care is not drug-related – only 20 percent of cancer-related costs are attributable to pharmaceuticals. While these are larger societal issues, they are issues that we, as a company and an industry, must address; and at Incyte, we have instituted multiple mechanisms to support and help patients who are using our products.
As part of that effort, we believe that the development of efficient, effective and safe drugs not only adds value to patients but translates into savings for the healthcare system. To that end, for 15 years we have been one of the biopharmaceutical companies investing in truly innovative technology and research and development to change the lives of patients with cancer. Investments in R&D are by nature very long-term and risky but as we see the scientific understanding of cancer and many other diseases improve so steadily we believe our best course of action is to continue direct investments in scientific discovery and R&D.
In addition, as an industry, biopharma is one of the few remaining areas where the U.S. is the world leader in terms of innovation and intellectual property. It is a very strong and vibrant engine of growth for the country – creating jobs as well as adding value for society. By not understanding and addressing the fundamental issues at play, we not only put our industry at risk but also the American patients whose lives we seek to better through science and medicine.
You operate differently than some drug companies, with an integrated team that moves proposed drugs from clinical trials to FDA approval efficiently. How did this system originate?
Our system follows the same process which was put in place at the time that ruxolitinib was developed – concentrating our resources and energy on the most important part of the R&D process, discovery and clinical development. From there, moving forward systematically from early to late stage clinical development and then commercialization.
How often does your research turn up any discoveries outside your core product lines?
In addition to our proprietary research, we have many ongoing collaborations and partnerships with the academic world. Some of these researchers work in fields outside of oncology or have different areas of focus than that of our biologist and clinicians and sometimes we find applications for our discoveries beyond what was the expected.
What do you do with those serendipitous discoveries?
We will move forward with any opportunity, serendipitous or otherwise, to help patients facing an unmet medical need. We are always open to partnerships or collaborations where we can leverage our expertise, infrastructure, and reach to ensure that new discoveries and medicines reach patients as quickly as possible.
You are expanding on Augustine Cutoff with a building adjacent to your current headquarters. How many employees will that addition accommodate?
The new building will accommodate about 450 employees, which will include existing employees and also future hires.
Can you tell me some interesting tidbit the general public doesn’t know about Incyte or its history?
Try it and you will like it! Eighteen of our 20 original team members are still at Incyte, as are 83 percent of the employees hired in 2002. Additionally, almost a quarter of our employees have been with us 10 years or more.
Product: Therapeutics for oncology
Founded: 1991 in Palo Alto, Calif.
Went public: 1993
Location: The iconic Wanamaker Building on Augustine Cut-Off in Wilmington
Phone: (302) 498-6700
Employees: More than 625
Financials: For the quarter ended December 31, 2015, total revenues were $244 million as compared to $124 million for the same period in 2014. For the full year ended December 31, 2015, total revenues were $754 million as compared to $511 million for the same period in 2014.