Fireside Chat With Giacomo Chiesi, Head of Global Corporate Development, Chiesi Group #210

Yeah, so first of all, it's a great question. It's certainly true that we have a common mindset across the company. And I think there are probably two or three things that we all have in common that we share. Number one, we do not just pursue growth for the sake of growth; we want to pursue sustainable and sustained growth. I think sustain is self-explanatory. But sustainable for us means that we don't just care only about maximizing shareholder value, or we don't just care about taking the product to the patients. We care about society at large, in nature and the environment. And we try to make the best use of resources in this way, in a circular way that makes such utilization of resources sustainable for the planet. Second thing is we are go-getters, we're very entrepreneurial as people. Each and every one of our employees is a go-getter and we pursue our objectives and our goals relentlessly and we never, ever give up until we get that thing done. And I think the third aspect is that we are very open-minded as a company and as people. We are truly committed to innovation and we're very open to embrace new technologies, state-of-the-art technologies. And that's a good time to speak about the technologies and it's a momentous time to bring new innovation to the patients.

Right, so first of all, thanks for the call for innovation. I think it's a great initiative and we're thrilled to be able to be an active part to it. And as you correctly said it, Katya, rare diseases is one of the pillars for our company's growth in the future. And so when we think about rare diseases, what we want to address is the entire patient journey. I think it's time that everyone realizes that the healthcare industry is now changing. And it's not just about providing a pharmaceutical product to the patients. But it's providing a full-blown pharmaceutical solution or a full-blown solution to the patients that addresses the patient's physiological needs, the patient's behavioral needs, in case there are any. Think about COPD, behavior, meaning smoking, and the causality between smoking and COPD is clearly evidence of behavioral needs in that case, and I think if you want to be part of the solution, as opposed to being part of the problem, you also need to address the deficiencies of the system of care which surrounds the patients. So in terms of rare diseases, there are a lot of companies that are now focusing on rare diseases, which are larger, and perhaps even more successful than us. So we take a very humble part in this game. But that doesn't mean that we're not bold and that doesn't mean that we're not here to serve the patients. Quite the opposite. When we think about rare diseases and we think about the solutions, we think about bringing to the patients new technologies that simplify the communication between the patients, the patient's families, the physicians, and the patients community to be able to reduce the issue of disease awareness. A lot of these rare diseases are pretty much unknown. I'm thinking about a disease that we are now treating with the first enzyme replacement therapy that was ever approved, Lamzede for Alpha-Mannosidosis, this is the name of the disease. We can only count 200, 250 patients on the planet with that disease. But the number of patients is not important for us, it doesn't matter to us. What matters to us is the patients and increasing the disease awareness is important. Second thing that we want to do is improve via protocols or in other ways the disease diagnosis. It normally takes between five and seven years to get to the right diagnosis if you have a very rare disease, and that's a clear societal problem. And number three, it's important to be able to monitor carefully the evolution of the disease. And I believe we're now seeing a certain level of maturity in some technologies that will help us better track and monitor the evolution of disease for these patients.

Sure. So first of all, I'd like to give a lot of credit to Ameya, who was the actual author of that piece. I probably wrote 5% of it, so he deserves all the credit. Second thing that I'd like to make as a preamble is that what I'm about to say is not to be regarded as or conceived of as a detriment to our competitors or larger companies. Quite the opposite. A lot of the StartUp Health portfolio companies might think that larger companies and non-mid-sized companies or large companies in general are better partners, and that's totally fair. With all that said, I think there are a few advantages of partnering with mid-sized companies. I think the first one is that you're looking at very focused use cases and user experiences, so to say. Mid-sized companies, by nature, tradition, history, are focused on few therapeutic areas. Normally two, three, perhaps four therapeutic areas and not focused on 10, 12 different therapeutic areas. And because of their tradition and history, they are normally focused on some and only some specific geographical regions. So because of that, you're looking at a much more focused use case, which in a lot of cases is helpful if you're thinking about a soft launch of a pilot before you go towards a larger patient population. Another aspect that I believe is worth mentioning here is mid-sized companies are, at least in our experience, you're less likely to face headwinds, and you're less likely to face a lot of internal politics with mid-sized companies. Mid-sized companies have to take care of business as much as large companies have to do, but mid-sized companies have a lot more limited bandwidth. So they really care about what they do in every single moment. And therefore, it's likely that you're not going to find a lot of politics and a lot of headwinds and a lot of different ranks that you have to go through to get the deal done with the mid-sized companies. And then I think lastly, and that's certainly true for family businesses. With mid-sized companies, you tend to have a bit more longevity of vision, mission, strategy, and leadership teams. It's just that particularly family businesses tend to be focused more on the longer-term prospects of businesses and many of them are not publicly listed. So a company like Chiesi, we're not focused on the next quarter report. We can really truly maximize the value for the partner because what we care about is the actual value that is generated over the long term for the asset from the partnership.

So, I think what we've learned in the last year or so by looking at the opportunities is number one, that as a pharmaceutical company, we have a certain mindset that I've alluded to before. And that's a very different mindset than smaller companies, which are focused on a different industry, for example, technology. The lingo, the jargon, the vocabulary is different, the way we operationalize our procedures and our solutions. And yes, ops that help us get solutions and products to the patient is different than what technology companies do. Definitely different. And the other aspect is that from, always from a mindset standpoint, we conceive of risk in a very different way. I think if I can summarize the risk orientation culture that we have at Chiesi, I don't know if that's different than most other technology companies out there. But the way we look at risk is you can't run away from risk. You just can't. If your philosophy and your mission is to pursue opportunity, then you're pursuing risk. You shouldn't run away from risk. You should attack risk. And when you attack risk, that means you should go in and demolish it by decomposing it into its pieces, its components and tackle the components one by one. So the way we generate value is exactly this. By taking risk and attacking it as opposed to running away from it. I've seen a lot of companies that do quite the opposite over time. And when you're a smaller company, you can't just run away from risk, just embrace it and demolish it. The last part is about failure. Failure can be lethal for a mid-size company, it can also be lethal for a small company. I think it's important to realize that it doesn't really matter how many times you fail, because let me just open up the door for perception here. It's not likely that you will fail, it's a certainty. You are going to fail, everybody's going to fail at some point. The question is not really whether you're going to fail or not. The question is, how quickly are you going to get back up and fight for what you think is valuable to fight for. And I think those are the things I've seen differentiated us from some of the companies we looked at.

A personal one is probably drive my resting heartbeat to 40. Right now, it's about 60. And my blood pressure is good. It's about 110 over 60. So I'm doing okay. But I like to move it down and become fully bradycardic and be happy about it and drive it to 40. And then a second one is over the next two to three years, be able to run a marathon.

Thanks for having me.