Neela Patel - Part 4: From Big Pharma to Biotech Leadership in Oncology

Intro - 00:00:01: Welcome to the Biotech Startups Podcast by Excedr. Join us as we speak with first-time founders, serial entrepreneurs, and experienced investors about the challenges and triumphs of running a biotech startup from pre-seed to IPO with your host, Jon Chee. In our last episode, we spoke with Neela Patel about her transition from Genentech to Poniard Pharmaceuticals, her collaboration with Greg Hageman on age-related macular degeneration, and raising $37 million in Series A financing. We also heard about her leadership role at Poniard and her experiences at Abbott & AbbVie as Director of Global External Research and Search and Evaluation, respectively. If you missed it, be sure to listen to Part 3. In Part 4, we talk with Neela about her transition from AbbVie to Seattle Genetics and eventually joining Good Therapeutics as Chief Business Development Officer. We'll dive into her decision-making process and how a meeting with Good's CEO, John Mulligan, changed her trajectory. We'll also hear about her experience leading Good through its transition by Roche and the importance of strategic deal structuring. Finally, we'll discuss her current role as CBO of Bonum Therapeutics. The company's focus on developing cytokine therapies for oncology and how they aim to minimize toxicity while improving efficacy.

 Jon - 00:01:35: You mentioned earlier that you're like, oh, man, I don't know if I'd want to join a startup after kind of doing this evaluation. I know kind of what's coming up here. What made you want to? Join good to do a startup, which is like kind of going against, you know, this kind of like gut feeling.

 Neela - 00:01:52: What happened was that a good friend of mine and colleague from AbbVie, Diane Hollenbaugh, had joined Good Therapeutics. She and I still stayed in touch. And I heard bits and pieces about it. It's fine. I was, you know, she seems happy. It's a lot of work. It seems good. And then at one of the JP Morgans, she set me up on a blind date. And I don't mean that romantically. What I mean is that she said, oh, you and our CEO, I think you'd really get along and you'd enjoy meeting each other, right? And I said, sure. From the time that I was on the buy side in BD, I would pretty much take any meeting that someone, especially if there's a personal connection, just like, hey, I'll spend 30 minutes with you. I don't know. You know, I'll do it. Absolutely. I was very impressed with John Mulligan as the CEO. I was like, oh. This is a really, really super smart person. Oh, your technology, you're still working on it. Okay. Great talking to you. We talked about some BD-ish things and whatnot. A year later, he reached out to me and he's like, we have some data. I think you might be interested to see it. So of course we did the thing since I was still at CJ and I said, look, I owe it to my employer. I need to share this internally, let folks look at it, play it out. So it didn't take long. They weren't interested. That's okay. So then I signed a personal CDA, was able to see the data and I was kind of blown away. And so then I was like, oh, I'm impressed with the CEO. I know that of research. She's now CSO, Diane. Let me beat the board members. I need to know if they're going to drive me crazy or not.

 Jon - 00:03:44: Just really quickly on that, just really quick. When I think about folks who are looking at joining a startup as a teammate, you almost have to do your own diligence like you're investing in them. Like you said, seeing who the board is, because who are the people that are in or steering this thing? Because you are investing Nila's time. At this company, you want to make sure that time is good. And that applies for everyone who is joining a startup.

Neela - 00:04:12: 100%. 

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Jon - 00:04:13: The difference between a good experience and a bad experience, I know it feels like, oh, the startup is evaluating me for the job. But the flip is also true, where you need to evaluate the startup and what their motivations are.

Neela - 00:04:26: You do. And I mean, even when I've joined publicly traded companies, I look at their balance sheet. I try to understand how much money are they really putting into research? Has it decreased or increased year over year or stayed the same? Who's on that leadership team that I'm going to be dealing with, right? And I feel like you should ask the same question. What's your runway? When is cash out?

Jon - 00:04:47: Yeah.

Neela - 00:04:48: How are you going to get to your next? Round of money. What do you need to deliver for your investors to release your next tranche, right? I mean, you should be doing your research on them. Absolutely. Absolutely. So I met with the board members. It turns out that one of the board members I had known when I was at SUGEN, and he was at Pharmacia, he was on the research leadership team, John Mulligan. And I remembered presenting my program to him because I was nervous as all get out. And I didn't think he'd remember me when we had our conversation with his on the board. He's like, of course, I remember you. You did a great job. I remember you.

 Jon - 00:05:25:

It's amazing. That's amazing.

 Neela - 00:05:27:

Yeah. So that was a nice like, oh, okay. He didn't know our paths would cross again. But I was very impressed that the board was really committed. To the company. Like there have been ups and downs. There had been, you know, John used to say when we first started out, well, the timeline to this molecule is six months to never. And they're like, what do you mean to never? And he's like, it might not happen. Right. So, I mean, I've learned so much from John about working with boards, both picking your board, which he did. He chose his board because he was serial entrepreneur. He knew who he wanted to talk to. And that also made a big difference because. There's a level of trust. There's transparency in both directions. You know, when something is not going right, they don't have to wait for the next board meeting. And they're like, when did this happen? Oh, two and a half months ago, the week after our last board meeting.

 Jon - 00:06:33:

Yeah. They're like a text message away. You're just like, hey, like I need some feedback.

 Neela - 00:06:40:

Right. So there's that level of trust that's been built by John with the board. And I was impressed with them. I was impressed by the scientific data, which to me was the first filter because that's who I am.

 Jon - 00:06:52:

And I'm like, yep, there's the filtering. Yep. I'm not

 Neela - 00:06:54:

going to take a risk on science that I don't believe in. And that's been a theme throughout my career. Do I believe? There's always risk inherent in the science that we do, but do I believe in the story that you're telling right now? So I was actually really excited to try a small company and see, and I was like, well. Either I'm going to love it or I'm going to hate it. Let's give it a shot. The worst that happens is I want to go back to big company life. I have loved it.

 Jon - 00:07:27:

Awesome.

 Neela - 00:07:28:

I mean, because all the components were there. And then, you know, doing the deal with Roche, doing a M&A at the same time as a spin-out, it was a ton of work. But it was a really good experience, you know, learning-wise, just building relationships. And so it was terrific. And I have to get – John Mulligan gets al the credit in the world. When he did a series A pitch to the investors of good, right on the slide was, we will give you an early return by selling an asset. That timing and the particular asset will be based on the program and external interest. I can't change the external world, but that's our plan. And so that was just not the most appealing way for anybody for us to do that. And we told everybody who was interested in our asset, look. We want to transact this as an M&A. So you will buy that asset and you will not have the complications of leases, employee contracts, reagents in the freezers, leases, like all this other stuff. And when we said that to Roche, Roche was like, sounds good to us. Do you promise? And I was like, I promise. I mean, obviously we had to promise on paper. It was, you know, that's how it just means.

 Jon - 00:08:56:

Yeah, not just like a pinky swear.

 Neela - 00:08:58:

No, no, not a pinky swear.

 Jon - 00:08:59:

Yeah, yeah.

 Neela - 00:09:01:

But they were, I think, for what they wanted, they knew what they wanted, just as you said earlier in the conversation. It was the intellectual property. We obviously gave them all the reagents and anything that went with that program. And a license to practice our technology for that. And they were happy on day one. They could just work on it cleanly. They didn't have the overhead of, oh, it's a collaboration. We have to keep them apprised. And they might want to muck about. Like, okay, it's yours. You do it your way. We were pleased because our... Our investors, which included our employee shareholders, and our VC investors got a good return on their investment. Our investors knew our team. They knew our portfolio. They knew our technology. They knew what else we had. It was early stage, but they knew. So they turned around and invested in our Series A. We took one additional investor of Vivo Capital because they have slightly deeper pockets and they could be a crossover as well. And I mean, I think it speaks to goods culture. Every single employee from good came to Bonum.

 Jon - 00:10:18:

So cool.

 Neela - 00:10:19:

And all of our investors came. So-

 Jon - 00:10:22:

That's so cool. It's interesting. Throughout this conversation, I don't want to go in a million directions, but it's amazing because I see it's your earliest days at Roche where you're balancing multiple stakeholders with different priorities and making sure to find a win, win, win, however many stakeholders there is. And starting that, from the outset. Like you said, you talk about the slides, like, hey, there's going to be a liquidity event. Like putting that on the slide and saying, I don't know exactly when, but there will be one. Like that is the plan. And I think something that... Founders, particularly those who may not have done this before, is I think it's critically important understanding, especially like with your investors, what exactly they're trying to optimize for and what their constraints are and speaking to those, like truly speaking to those. I always thought about like... When you're in negotiation, you should be able to argue the counterparty's position as well or better than their position. And I'm not saying this from a manipulative perspective. It's just understanding what motivates them. And I think if your investors are like, I need liquidity for my LPs at this soon. Say it, put that into your business plan. But you should know that. That's what they're trying to do. And I think also understanding each type of capital provider has a different subset of priorities. And know exactly what you said. Your CEO chose his investors and board specifically is making sure that, okay, we can actually accommodate their needs and vice versa, they can accommodate ours. Because I think sometimes there's like, again, we're talking about this 2021 indigestion is no one took the time to understand, what the other side truly needed. Got caught up in this momentum, and I think you know, something like just like for a quick and dirty math like, you know, for VCs like, like for a smaller fund they have like these multiples that they need to return.

 Neela - 00:12:40:

Yeah.

 Jon - 00:12:40:

As a reality as an objective reality. And when we've heard these horror stories about just like taking over the company, trying to like, you know, basically write the ship, like investors trying to write the ship. It's not because sometimes there might be malintent, but it's not, it's usually not personal. It's usually because there's math that is taking place. There's math and the math is not mathing now. So they're now like coming in to make the math work. Sorry. I, that was kind of me just going down a rabbit hole.

 Neela - 00:13:13:

No, I think it, no, it's exactly, I mean, it's a, it's, it's a hundred percent right. And I mean, our transaction with Roche had a 250 million upfront. And I know in an M&A, you're like, what is an upfront? Well, you know how it is nowadays with M&A. It used to be that an M&A, here's the money, I get my thing. Right. But especially with earlier stage. Programs where they're not fully de-risked. There's no way this thing was de-risked. You know what I mean? Like certain aspects of it absolutely were de-risked, which is why the payment was made. But there's, you know, downstream payments that come. So some, it's, if you're transacting something that is not commercial stage, I also think the expectation should be that it looks a little like an M&A license blend and not, I mean, you can call them whatever you want, whether you call them contingent value rights, whatever name you want to give them, but basically it's a future payment upon something happening, right?

 Jon - 00:14:17:

Yeah, some sort of performance.

 Neela - 00:14:18:

Right.

 Jon - 00:14:20:

Yeah. And I guess just like from a personal side, what was it like being on the other side, on the sell side, having been on the buy side?

 Neela - 00:14:28:

It's so interesting that you said that you think that if you're a good negotiator, you should be able to argue for the other side equally well. On the sell side was weirdly not that different than being on the buy side.

 Jon - 00:14:44:

Interesting.

 Neela - 00:14:44:

Because I still had... My internal folks that I needed to align with the CEO and the board, right, on terms and everything like that, that's no different. When you're in a big company, you're looking to the senior leadership and the people who are going to write the check. You got to align with them. So there's always somebody that you're making sure that you're on board, right? And the idea of understanding the other party's needs, that doesn't make any difference whether you're buying or selling. You need to understand. What their needs are and how do you craft those principles? And then honestly, having a good legal team, which... Been very fortunate throughout my career to work with amazing attorneys. But I asked our CEO if I could pick our transaction attorneys. And at first he was like... And I was like, you don't understand. I'm going to be spending more time with them than I spend with you. And so it's got to be somebody that A, has the expertise. B, will complement my weak areas, which I'm aware of them. And, you know, I just know I need somebody to complement those. And I have to be able to live with them because I am going to kind of be living with them.

 Jon - 00:16:02:

Yeah, yeah, yeah. I'm going to be hunkered down with them for burning the midnight oil proper.

 Neela - 00:16:09:

Yeah. Exactly, exactly. So we got really terrific transaction, two transaction attorneys. They had different specializations, but they work as a team. So that was amazing.

 Jon - 00:16:21:

That's amazing. And so now that you've. Done the transaction with Roche. Can you tell us a little bit about Bonum and what you guys are up to, like mission and focus right now? What is it that is... You guys are North Star for Bonum.

 Neela - 00:16:39:

It's interesting. It's not all that different from Good's mission. The only difference is that that one program is with Roche now. So our current focus is still on regulating cytokines for oncology. We have some early stage, as I mentioned, early stage work in INI. And our mission is really to develop drugs that will be transformational for patients. The cytokines that we work on have some evidence of clinical activity. Our current lead program is a leg three regulated IL-2. And IL-2, as you know, actually is available by itself as a product. It is extremely toxic. Providers are hesitant, oncologists are hesitant, patients are in the ICU for it to make sure that You know, they don't die, which a fraction of them do. But what has been observed is patients who make it through often get durable remissions. You know, what? You might call it cure. And so we really believe that if we can minimize or zero out the systemic activity of IL-2 in this case, but we also have interferon-alpha. We've got a few others we're working on as well. And have it only be active in the presence of antigen X, in this case, LAG3, but we have other either cancer-associated fibroblast markers or other tumor markers, that that will be transformative for patients because you not only widen the therapeutic index, but you're also potentially able to dose to a higher level that you couldn't. Previously. So I guess that's really how you're widening the therapeutic window.

 Jon - 00:18:36:

Very cool. And would you say like the status quo, it's just like the toxicity profile is just like abysmal. And we're trying to disrupt the status quo and try to like basically make it less toxic.

 Neela - 00:18:50:

Yeah, I mean, our tagline is systemic delivery local activity.

 Jon - 00:18:54:

Yep.

 Neela - 00:18:56:

And we do that through our technology of dual binding antibodies where the antibody itself can on one arm bind A or B, but not both at the same time. And we've fused our cytokines in line. And in the presence of that dual binder, they're fully bound and not going any, you know, they're in circulation. In the presence of what we call the sensor or the other antigen, that antigen gets the molecule down to the surface of the target cell. And now there's some breathing, of course, for the cytokine and its antibody binder. When it comes off, the concentration of the sensor is so high that at some rate it displaces. The cytokine, and now... The local concentration of the cytokine is unbelievably high at the cell surface. So you're able to activate the receptor quite readily.

 Jon - 00:20:07:

Very cool. I was going to say the, I love this too, because like, I kind of see like Bonum as a kind of like this culmination of like all this, like kind of. Lived experiences that you've had. And I guess just a quick question. Are you guys also filling pipeline within licensing as well?

 Neela - 00:20:28:

No.

 Jon - 00:20:29:

No. Okay. So all internal pipeline.

 Neela - 00:20:31:

It will all be homegrown. We are looking to expand the reach of our platform. If somebody comes to us with a therapeutic and sensor, the therapeutic does not have to be a cytokine. It could be any protein, anything that an antibody can bind to basically. So therapeutic and a sensor antigen, we will make that regulated therapeutic for them. And then they can be off to the races with it. So we would like to expand our reach that way, as opposed to, oh, now we're also going to be in this there period. Now we're, no, that's just not, that's not a good business or robust business model. So.

 Jon - 00:21:18:

Can you talk a little bit about the partnerships and companies that you guys seek to work with and partner with?

 Neela - 00:21:23:

You know, for that latter kind, we don't have anything to report publicly at this point in time. But we're really looking for people who have a problem they're looking to solve. Like, hey, this is a thing that we want to do. We think and we're like, okay, yes, our technology could do that or no, it couldn't. And if it can't, let's just, you know, part ways amicably as soon as possible. And if it can, let's get to a work plan, see who does what and move it on forward. We're looking for people who have deep expertise in that biology, right? So they understand it. They know the problem and are keen to work with us. We're also going to be looking for partners for our internal portfolio programs because we are not going to run pivotal trials in the near future, maybe in the distant future. We're certainly not building a sales force. That would make no sense.

 Jon - 00:22:18:

Yeah.

 Neela - 00:22:19:

And so we know that our programs will be partnered. The question is, is it appropriate to partner them at clinical candidate stage? Is it better to have clinical data? And it's going to depend on the molecule and how much, like where the perceived risk is that we think the risk is and that the potential partner sees the risk, how far we need to take it before we would transact.

 Jon - 00:22:45:

Very cool. Very cool. And as you are looking for one year. Two years for Bonum. What's in store for you guys? Or at least, you know, as we're looking into the crystal ball.

 Neela - 00:22:58:

A couple of years out, I'm really hoping that we will have clinical data. We are in the process of selecting our clinical candidate and we'll be off to the races with scale up and then GLP talks and so on. So we have a path to get that one into the clinic. That's our leg three regulated aisle two. And then we think given how our pipeline is developing that we will have a new clinical candidate maybe every 12 to 15 months. Maybe it'll be sooner. Maybe it'll be a little longer, but we do have a pipeline and we have a line of sight to getting the in vivo efficacy data and the initial estimate of a safety window to be able to see that it has the potential to be a clinical candidate.

 Jon - 00:23:50:

That's so exciting. And also like, I love, I don't know, as a kind of a cheerleader for you guys, it's like, you guys really have like an Avengers team, like in this Avengers, what it feels like the Avengers squad. That's like, if I were gonna bet on anyone, it would be you guys.

 Neela - 00:24:08:

Thanks, Jon. That's that considering how many entrepreneurs and people you talk to and companies you meet with. I'll take that as a compliment.

 Jon - 00:24:15:

Yeah, it's super cool. It's super cool to hear. And throughout this conversation, I every time I would have interrupted you too many times that I was like in my head, just like fist pumping. I was like, yeah, like, yeah, like, yeah. And I see a lot of, you know. Kind of a similar lived experience. At least sometimes, when I have these experiences as an entrepreneur, I'm like, I'm the only one feeling this, but it's also great to hear that you have experienced it on your side too. And it's like, oh, like, okay, I guess I wasn't crazy to feel that way. And it feels less alone, I guess is what I'm getting at.

 Neela - 00:24:54:

Yeah. And I think you raise a really good point. I would say to entrepreneurs, whether it's your, especially if it's your first, but even if it's just your second, third or fourth go round, being CEO or founder can be very lonely and you have a lot on your shoulders. Like, am I going to be able to make payroll? Are we going to get to the next data set that I'll be able to raise money off of? Like it's... Serious pressure. It's really hard. And just don't do it alone. Whether you meet with your fellow CEOs, there's plenty of conferences that are just meant to network CEOs, or you get some experienced advisors who can be a trusted ear, like, got an HR problem, need to talk to somebody outside the company, or got this thing that's going on, must have ears, right? However you want to do it, do it, because it's the way in which you will get to your goal and still be seen at the end.

 Jon - 00:25:59:

Yeah, that's. Spot on because i think you know from the earlier earliest days of like just like banging on the door and just like like not being shy about it. Like, it's just like, it's like no one's gonna bite you, and what's the worst thing, they can say is like no, I don't have time to talk, like. But those that will might have a massive kind of like inflection point for you, and might actually put you on the path that you want to be on and should be on. So I love that advice. And, you know, Neela, you've been so generous with your time. Like, I honestly could, I can talk into infinity with you. It's been super, super fun. But I realize that I can't do that.

 Neela - 00:26:38:

For me, too. For me, too. And I don't know if there's any listeners who are going to make it through two and a half hours of us. You'll parse it out in bite-sized pieces that they can manage.

 Jon - 00:26:48:

No, I believe they will. And I know for sure they will find value out of this conversation. And also, it's been super fun. So I think they're gonna have a blast listening as well. But in traditional closing fashion for the podcast, we like to round it out with two questions. So first question, would you like to give any shout outs to anyone who supported you along the way?

 Neela - 00:27:09:

Yeah, I've had two people. I mentioned Tony Hallett at Sujan. Just really... Gave a supercharged push to my career by giving me opportunity. And Jane Hoff Smith at Abbott and then AbbVie, who really helped me cut my teeth in the BD world and was highly supportive and a friend. Both of them were both colleagues and friends.

 Jon - 00:27:34:

Absolutely. And I think those are the best too. It's like, especially when folks would like give you a shot when perhaps you don't deserve it yet.

 Neela - 00:27:41:

Yeah.

 Jon - 00:27:42:

It's it's massive like when you're i was like we talked about your early lab experience it's like I wasn't adding value to the lab in the earliest days. Like, but thank you. Like, thank you for being willing to take me in. Like, that's amazing. And like, it changes the trajectory. And second closing question, if you can give any advice to your 21-year-old self, what it would be?

 Neela - 00:28:03:

It would be to maintain relationships with people over time. I didn't necessarily, I enjoyed my postdoc. I enjoyed the people. There's a handful that I'm still friends with. But I wished that I had known that those people would also be my cohort going forward. And life just got busy. You know, it wasn't like they were bad. I was bad. I think most of them probably maintain the same number as I did just, you know, overlap people. But that really is if you can set aside some time. And it feels like when you're in your first job, you're like, I don't have time for that networking stuff. I just have to like get my work done. Right. What do you mean networking? But it will pay off. And it can be as little as like. An hour a month, meet somebody for lunch once a month. It's not a big thing, but you know what? At the end of the year, those are 12 people you're connected to that you weren't really connected well with at the beginning of the year.

 Jon - 00:29:08:

That's amazing advice too, because I think I, I, I, myself, I still struggle sometimes. I'm like so busy, so busy, so busy. I'm like, and it's, it's easy. You just kind of like kind of get stuck in the kind of inertia of it, but incredibly important. Like you said, it's like, and like, like all relationships, you got to put in a little bit of time. It's not like you don't have to be like attached at the hip necessarily, but it takes, you got to put in a little bit of time. And also it's fun. Like, it's like, it's also fun to like, you know, see friends from, you know, wherever you, you originally crossed paths. And I think that's incredibly important too, because I think as I kind of think about and reflect on your journey too, like talking about SUGEN being on the board. Like as you were deciding, do I jump into the startup life? I'm going to talk to the board. SUGEN, you're like. What? Hold on a second. Like it's a small circle or like it's a small world, I guess. It is.

 Neela - 00:30:02:

It is. That's exactly right.

 Jon - 00:30:06:

That's incredible. Well, Neela, thank you so much. This has been super fun.

 Neela - 00:30:10:

Thank you, Jon. You made it really fun for me.

 Jon - 00:30:12:

Yeah, that actually means a lot. And, you know, I know for sure the listeners are going to have a blast with this. And, you know, maybe, you know, in a future date, we... Can do a part two. Grab coffee. I'd love to catch up with you again.

 Neela - 00:30:27:

Wonderful. Thank you, John.

 Jon - 00:30:29:

Thank you, Neela. Talk to you later.

Outro - 00:30:31:

Bye. That's all for this episode of the Biotech Startups podcast. We hope you enjoyed our four-part series with Neela Patel. Be sure to join our next series with Michael Chen, Chief Executive Officer and Co-Founder at Nuclera. In 2013, while working on his PhD at the University of Cambridge, Michael and his co-founders became frustrated by the inaccessibility of proteins to support everything from basic research to drug discovery. This prompted them to found Nuclera with a clear mission in mind, make proteins more accessible to everyone by providing rapid access to high-quality, soluble, active proteins at the benchtop. For the past 10 years, Michael has led the company in raising multiple funding rounds totaling $83 million. He's built a team of over 100 people strong over two continents and leads the commercial strategy behind bringing their innovative, rapid, protein prototyping technology to market. Michael's decade of experience running and growing a biotech startup offer insights for founders to take advantage of. The Biotech Startups Podcast is produced by Excedr. Don't want to miss an episode? Search for the Biotech Startups Podcast wherever you get your podcasts and click subscribe. Excedr provides research labs with equipment leases on founder-friendly terms to support paths to exceptional outcomes. To learn more, visit our website, www.excedr.com. On behalf of the team here at Excedr, thanks for listening. The Biotech Startups podcast provides general insights into the life science sector through the experiences of its guests. The use of information on this podcast or materials linked from the podcast is at the user's own risk. The views expressed by the participants are their own and are not the views of Excedr or sponsors. No reference to any product, service or company in the podcast is an endorsement by Excedr or its guests.