Founder Stories: John Martin, Former CEO of Gilead Sciences

Thank you.

Yeah, I was probably destined. Both my parents are chemists. My father is also a PhD organic chemist and he spent his career in the pharmaceutical industry, so I think I was programmed from an early age. In high school, my chemistry teacher said it's great to go into chemistry, but for college you should do chemical engineering because it's a much broader background that prepares you better for the real world. So I simply took his advice and went to Purdue University. I lived in Indiana, so Purdue was at the very top of chemical engineering. It was an easy decision to attend Purdue University. Purdue has a great background in engineering overall, one of the leading schools in the country.

Yeah, so after Purdue I went to University of Chicago for a PhD in organic chemistry and again was fortunate because I worked for a fellow that had led chemistry at a major pharmaceutical company called Squibb, now Bristol-Myers Squibb. He had left Squibb to start an academic program in Chicago. He was a professor of chemistry, biochemistry, and medicine. I felt like certainly chemical engineering gave me a very broad background, but working in his lab was just terrific for what I did for the rest of my career. And I think the thing fortunate comes in many times in my life because when I finished the PhD, my professor's brother was head of R&D at the pharmaceutical company Syntex in Palo Alto, so he just sent me to work for his brother. If that doesn't get easier than that.

Well, Syntex at the time I went was a small company. They were formed in Mexico, only moved to Palo Alto in the late 60s. They were small, very entrepreneurial. Believe it or not, in the late 70s Silicon Valley already had all the entrepreneurship that you see in IT today. Being in that environment, Stanford University and various groups around that were collaborating was just a terrific learning experience. I also had the good fortune of discovering a drug right away at Syntex called Ganciclovir. It's an antiviral and it's used in transplant patients to prevent opportunistic infections. And also in parallel, I went right away to the Golden Gate MBA program in the evening. I felt with a chemical engineering more practical background, it just seemed obvious that an MBA could help the career. I finished that in 1984 and was immediately recruited for a substantial promotion to Bristol-Myers. And then at Bristol-Myers, I was asked to build an antiviral program. We came up with two of the very important drugs for HIV. And those accomplishments are what led for me to go to Gilead to build a company that would just focus only on antivirals.

Yeah, it's maybe some nature of the practicality of chemical engineering. Knowing that you can be, if you want to be esoteric in chemistry, it's better to stay in the industry where it's more about publications. But having this practical education as an undergrad where you're designing things that people need immediately or working on products just to make them better. Discovery in the lab, you're making molecules and then they go somewhere, but most of the time you don't know where they go. Other people handle the transition for drug development and commercialization. So I knew if I wanted to be a part of that, it would be very advantageous to get an MBA degree.

There's been, we could talk about this all day. The scientific advances that happen over and over at a faster pace allow the industry to come up with products more and more rapidly that allow people to live longer and healthier lives. And it's not just chemistry and biochemistry and biology. The revolutions in IT and data management and understanding how to design drugs by less of a trial and error mechanism has advanced the science enormously. Even, you know, I remember a friend of mine had a company in his garage when I worked at Syntex to make a reagent for sequencing DNA. Who would have known that a few years later we would be able to sequence entire genomes so rapidly? The technology back then was just developing, it was very crude. And today it's very straightforward to come up with DNA sequences, complete genome sequences of people and animals, and it greatly accelerates drug discovery and development.

Yeah, you're absolutely right. So one of the things I did all these years at Gilead is, once we had a commercial organization, we built a commercial organization very early because you really don't understand R&D and what you should do unless you have a presence in commercial markets. And once we had that commercial organization, we would prepare spreadsheets that would send scientists to manage but out in the field with sales reps to better understand what the market needs. And that is a specific subject that was drilled into my head at Golden Gate University.

Several of them. And I should say, my major was MBA in marketing. I figured I knew all the technical stuff, I wouldn't have trouble with statistics or analytics or any of that, but marketing seemed like a black box to me and something I wanted to learn.

Well, very enjoyable. The adult education you appreciate because you're learning from people that have real jobs, not just the faculty but also the other students. So there's an extra level of energy and knowledge and sophistication when you work together as a team on a project, for instance. It was one of the more difficult things because as a laboratory scientist, how much you accomplish day in and day out depends mostly on the number of hours you spend in the lab. So it's a challenge to balance the time to go to night school several days a week. I often found myself driving up and parking on Mission right when parking was free, about an hour and a half out of class, buy a burrito around the corner, come back to the car and get my typewriter out for final touches on some class assignment. But it was very, very fun. I didn't really know that I'd learned so much by taking on the challenge.

Well, I was at Syntex as a laboratory scientist. When you first start, you work by yourself, you don't have anyone working for you. Then I started to have a larger group. But it's just really hard work. That's the secret. You have to give up some things to go to night school, that's for sure.

Yeah, but you know Robert, I hadn't thought of it this way, but that's actually a certain aspect of the training. Because every day when we go to work, you can't do everything you want to do. And thinking about the trade-offs broadly of what could have an impact for the organization or for people using your products is part of the key to success.

Yeah, so I probably, I guess I've worked in industry at that point for at least two decades. One of the key things you do as a manager with people reporting to you is talk about development goals every year. What do you need to do your job better? Or if you want to do it, what do you want to accomplish in your career and what do you need to do to accomplish that? Of course, I could use myself as an example. Getting an MBA degree gives you a lot of additional skills, gives you less quantitative skills, too, however you wanted softer skills. And it puts you in a position that you're identified. So if you get an MBA degree, people within your organization will say, wow, that guy's making the extra effort to qualify himself for new things. So year after year, I'd find very few people would undertake that night school component of it. So I worked with people at Golden Gate University to put together a program that would make it much easier and entice more students, or more Gilead employees, to sign up and get that extra knowledge.

Yeah, and you know, there's just countless success stories of people that went through the program that are strong advocates for why the younger employees at the company should continue to avail themselves of the opportunity.

Yeah, well, you know, I can't say that I was the biggest part of it because I went to your colleagues at GGU and we brainstormed about it. And it was a very forefront thinking thing because each week one class would be in person, one being virtual, and doing that 15 years ago was kind of unheard of. Today it seems so easy, but it even took a coronavirus pandemic to get people to learn how to do virtual really good. And from the beginning, I would check with some of the employees taking the program, say, does the virtual thing work? Oh, that's done really well, it's great. That was a key feature. Another very interesting thing, being from the company, I thought the employees won't have to pay for this, they're putting in a lot of effort, the company will benefit. The GGU staff at the time said there should be like a 10% payment, not that material, but just one of those motivation things that clicks you to getting value from the efforts that you're putting some of your own value into it. I don't know if it's still that way, but I wouldn't have thought of it that way, but when you hear it, it sounds like a really good idea.

Oh, that's an easy one. It's, and you know, this question someone really has the interest. So if someone has the interest, you give advice about what the alternatives are and how they might think about it. Just get an MBA. There's so many different emphases, how to think about what you want to do. So it's almost a different discussion with anyone you talk to.

Well, first off, make sure you do a good job at work while you're going to night school so that you, that's the one thing that I always talk to people about. You can't let off on work while you're going to night school because people say, wow, he's not motivated to do his job. Once you get the MBA, I think as people go through an MBA program, they get a good idea of what types of things they might want to do going forward. They're qualified for more leadership roles within the company. It could be a situation like I was at. I don't know if I should recruit it for my scientific reputation which was strong or the fact that I had an additional MBA. But for whatever reasons, Bristol-Myers was quite confident in trying to recruit me and they were very diligent about it to get me to come at the time to Syracuse, New York.

Well, I'm sure everyone has this experience that virtual meetings work better than they had before and better than you expected, but that's simply because we all had to do it. So it was kind of a given that you'd work it out. People say a lot of people tell me they haven't missed anything, but that can't hardly be true because when you're interacting with people in person in a more dynamic environment, you find forks in the road that we may be missing now. And in my own day-to-day activities over the last year, I can see some forks in the road I missed. I may not have missed. When California was shut down in the middle of March last year, on a Friday a conference was canceled in Boston. I was leaving for it on Friday, so I just didn't go to the airport. And I had trips planned for each of the next 10 weeks, serum international and I think all important. So I think it's really important to get this pandemic behind us and get back to our normal work, going to scientific conferences around the world, meeting scientists, meeting physicians. A lot of the work I've done is with government officials where it works a lot better to educate government officials if you can do it in person.

Yeah, Robert, it reminds me when I came to Gilead, there were all kinds of young people that you didn't have the older generation that you can tell who has done that lifelong learning because of where they are in the organization. So the head of our IT was a father named Norbert Bischofberger, still works fantastic. I told him, you have these BS, you have PhD scientists, would they come to work for Gilead? They're all thinking I never have to take a test again. But the job of us as managers is to help people know that you have to keep learning and you still want to get an A on the test. It just fits your point so importantly.

Yeah, it's Robert, you're right. I've been heavily involved in that. I was on a conference call at 7am this morning talking about COVID and influenza and products that could accelerate protection. I've, we may get this later, but Gilead brought Tamiflu for influenza to the market 20 years ago and it's been a phenomenally important product and it's kept in reservoir for also pandemic influenza. So what I've learned in the past year that we've all learned is when you have a new virus come out, not even top experts know exactly what to say. You learn about the virus in real time, the disease in real time. So for instance, the people I worked with in the spring, I would say wherever you do, don't get sick now because no doctor knows how to treat this disease appropriately. And we've seen over the course of 2020 that medical practices evolved quite a bit on how to treat COVID. The most exciting thing, and it's great because everyone knows that the industry has been able to address the pandemic with a completely new technology that's never been used before to come up with what we have now for two vaccinations. And to think about that being done in less than a year, even I'm stunned that it could be done so well.

Well, there are, when I first went to Gilead, Gilead was working on this type of technology, making oligonucleotides or pieces of DNA or pieces of RNA which contain the genetic information. So in theory you can make it into a drug to affect gene expression or to create antibodies to a virus. But the practice of it took a few decades and many false starts and many companies formed around it. But there are numerous companies now doing gene therapy and messenger RNA and siRNA that have very substantial successes in healthcare. The two vaccines that we have on the market now, one from a biotech company in Boston and one from a biotech company in Germany, they've been working on this technology for a number of years. And both were moving toward having products a couple years from now, but they had all the technology experience, they've generated human data. So what happened, the COVID coronavirus came about in China, quickly moved around the world, and early January China published the sequence of the virus, the DNA sequence, and that allowed these two companies to quickly come up with a sequence for the messenger RNA that they could use to create vaccines. And it's that type of a lot of analytical chemical, biochemical techniques and also understanding how to manage large amounts of data so you can figure out exactly what you want to make into a vaccine.

Yeah, well, I think all of that. It's a, we were actually very impressed that HIV came around in sort of the early 80s and figured out more what it was about in the mid 80s. The first drug was approved in 87, that's AZT. And people thought wow, now we have a drug. Well, what no one knew is four months after a patient started taking it, the virus would mutate and become resistant, so it provided very little benefit. So the evolution put two drugs in combination and it worked a little bit better, but people still got resistance. And it wasn't until 1996 that the first three drug regimens were approved. And that worked pretty well, except the pills, you have three drugs each given multiple times a day, some with food, some without food, and with sufficient side effect profile that made patients feel bad. So people wouldn't take all their pills, they'd fail due to resistance because if you take one or two, you're going to get resistance and lose the regimen and the whole class. What we did at Gilead was come up with very safe once a day drugs to simplify therapy, then combine them all into a single pill. And the first of those was launched in 2006. So 10 years after we characterized HIV, there was a three drug regimen. Ten more years, there was a single pill of three drugs just given once a day. And that transformed HIV because you take all your medication or you don't take a partial regimen and get resistance. Now we saw outcomes improve, resistance plummet, people doing well, people not running out of treatment options. We continue to iterate better single tablet regimens so people continue to have better outcomes, and with better safety profiles because as you know, a person with HIV will take the medication for the rest of their life. So each one of these steps along the way seemed very exciting at the time, but to continue to innovate to improve AIDS care to where it is today, and to the fact that 90% of people taking Gilead's medications for HIV are in low-income countries, that's just a phenomenal transition over the last decade.

Well, I will say our first single tablet regimen launched in 2006. We had two drugs, the third drug we wanted was owned by both Bristol-Myers and Merck. They allowed us to work on the formulation of a three drug regimen, which took a couple years because four of the formulations failed in human clinical studies, they didn't create the right bioavailability. You have to get the same exposure in the blood as you would if you gave each pill separately. Negotiating that contract also took two years because you have two companies, different territories, all the anti-trust considerations and competition considerations. But we worked it out. There was a lot of motivation on the part of all three companies. And we thought at the time that all the people involved today think that that's the model for how the pharmaceutical industry can work together to get better outcomes. And we've continued to do it. We have, for instance, a very substantial large collaboration with Johnson & Johnson to deliver unique combination pills for HIV. And we're seeing more and more of that because when you think about oncology, if you use a single drug you develop resistance over time, so there's more and more collaborations among industry to move things along very rapidly.

Yeah, I certainly am of that philosophy, and most people I know that are in infectious disease agree. You know, the coronavirus we have now is the third in the last 20 years. There was SARS about 18 years ago, MERS more recently. They're both related to the virus that's circulating now. And because the virus we have now is replicating in so many people, that replication leads to mutations, and we're seeing those mutations emerge and they're very concerning going forward. Influenza, we all get vaccinated every year because it changes so often, and we try to stay ahead and predict what the change is going to be, but you don't always get there. So this whole thing is kind of a call to action, and hopefully people will have a longer memory this time around. I gave a talk about 14 years ago to an efficiency society conference, and my first two slides were one of the increase of airplane travel and the other increase of cell phone processing power. I said these things are making the world a lot smaller. As population grows, people have access to information, people travel more, the risk of pandemics grows proportionally larger. So I don't, some people say let's wait, we won't have another one maybe until 100 years from now because of the 1918 flu pandemic. But no serious scientists in this field believe that we have 100 years to deal with it.

You're right, and that emotional thing is kind of something to be very careful about. Yep, you know right here in California, there are people working in hospitals and clinics seeing patients that aren't getting vaccinated because someone will say we have to worry about the safety, yet the safety is so well documented that it's kind of important to address those concerns and to the extent a rationalist to the point that it's kind of an irreversible step to get the needle in your arm, so you can kind of worry about it. But in this case, I've never seen the balance so far to people having an enthusiasm to get the vaccine rather than be suspicious of it.

Yeah, and you know, everyone's going to have a different opinion of that depending on who you are. It's very challenging. I'm of the mind, and I was glad to see that it's come to that over the last month, that you want to open it up to large groups of people to create momentum in vaccination, and that's happening now. The other thing is, you can argue well, if you vaccinate younger people who are more active, you can prevent the spread, but assuming that your vaccine is at a consistent rate, I would argue to go by age. Then you're taking care of the people first who are the most likely to have serious consequences, serious illness, hospitalization, and death. And now you're preventing morbidity and mortality, but you're lowering the cost of the healthcare system that is always the barrier. When we have a shutdown, it's because there's a concern that the healthcare system gets overwhelmed, not that people get sick. And I'm very pleased to see it started out that way in some parts of the country, but it's that way now pretty much across the country. And it makes it simple. If you have a driver's license or another ID that says I'm just 65, you just show up and get vaccinated. And an additional flexibility is across the United States, there are many communities at the end of the day if no one's coming around to get the vaccine, you can walk in at any age and get it. And making a simple distribution system like that greatly increases the efficiency and gets what we want: maximum number of people to be inoculated as quickly as possible.

Yeah, Robert, that's what I was talking about. I heard Gavin Newsom give a talk this week where he compared it to like an airline. You're waiting there, first class people get on, business class people get on, coach class people get on, different categories of stuff, but they never wait till one class is filled before opening the next class, or the plane may never board. And I thought that was a good analogy because the idea that you're going to in fact vaccinate everyone in a certain category before going to the next one is a real burden on the distribution. What I think still needs to be done, it's done in some states. West Virginia has vaccinated a lot of people because they put it out in the pharmacies where you could just walk in and get it. And as we get more vaccine supply and as we get more of the critical medical infrastructure vaccinated, which is pretty much done, having vaccines distributed through normal distribution channels of going to a pharmacy or your doctor's office to get it, there's just so many points of care that it could be hugely efficient. Right now we're doing it like mass vaccination programs and trying to set up infrastructure that didn't exist before this, and so there's some growing pains for this first month or two.

Uh, not really. There's always a tussle in healthcare because of the complexity, especially in the United States where there's so many different mechanisms and actions. I do, I'm optimistic about the industry because we still need more solutions, and it's the pharmaceutical industry is valued by people who take the medications, as I said, live longer and healthier lives, and every year we keep seeing innovations faster and faster and better and better. There's no example superior to the turnaround of the coronavirus vaccines in less than a year.

No. You know, people may think of a pharmaceutical company as all scientists, but by far the majority are not. Scientists or physicians, a lot of physicians too, but they're all just like any other company. There's a lot of IT and finance functions. Some of the people in the commercial functions are scientists, many are not. All companies have large legal departments. And one of the things I've noticed, because I had an MBA in marketing, you see what's going on in the rest of the company. Innovation isn't just in the laboratory. Innovation is how to get these medicines to people who need them. And that's always a struggle. How do you get medicine to where it needs to be? How do you determine who gets it? How do you work with the various government organizations and hospitals to figure out what people should be getting what medications or what other type of care? So there's opportunity no matter what your background is. There are opportunities in the pharmaceutical industry.

Well, the fact is, it's for-profit and that drives the investment into the industry, so that's a good thing. In terms of collaboration, we talked about just now about innovation. So what are bigger innovations we did at Gilead for the first single tablet regimens? To work with Merck and Bristol-Myers, I believe I mentioned it's very difficult how to go through the regulatory aspects of that, takes a lot of time. But what you find when you want to do something with other companies, you find like-minded people who understand that you're not giving up your piece of the pie, you're making the pie bigger for everyone. That concept is often not realized, but finding like-minded people allows you to do those types of things.

Yeah, it is absolutely true. And it's surprising how often how important it is to continue to build those skills, not only to get an MBA but to continue to work on them throughout your life.

Yeah, I thought that's what you wanted to know. So starting about 18 years ago, we thought we'll just make them available at no profit to poor countries, and that didn't work at all. We quickly realized that you need to go about it in a very intelligent way where you deal through regulatory bodies in these countries, you need to figure out distribution channels, and most importantly we transferred our manufacturing processes to low-cost chemical manufacturers in India so that they could drive the prices down. And it was kind of an experiment, you could think of it as an economic experiment that you could do an MBA class on. But it worked extraordinarily well. The uptake went very rapidly. Remember, coming off of single tablet regimens so that you don't have a lot of resistance if someone goes on and off drugs, these regimens were ideally suited to low-income countries that may have poorer infrastructure for getting the drug to patients. And it's been phenomenal. And by treating people, HIV spreads from people who aren't being treated. If a person with HIV is treated, the virus goes too low in their body to transmit it. So in addition to allowing people to live a normal lifespan, this whole concept greatly reduces the spread of virus by having a safe single tablet regimen that you can use to treat anyone with HIV, rather than what it was 10 and 15 years ago, waiting till someone gets sick and has a compromised immune system before you treat them. It's been totally transformed. It's why global organizations like the United Nations could talk about ending the spread of HIV in our lifetimes.

That's kind of, one thing employees at Gilead are so proud of is having the impact in the United States and around the world. A lot of it is just in policies. Up to about 14 years ago in the United States, to give an HIV test you had to do a separate and formal written consent and 30 minutes of pre-test counseling. So that was a huge barrier because people wouldn't do it. The healthcare system wasn't doing it, and people weren't being diagnosed. So simply to get people comfortable with the fact that we'll just treat HIV like another disease, if you get a blood test you can put an HIV test in there if you haven't had one for a while. It's what allowed a lot of additional patients to be identified, especially in communities where there are disparities. That additional barrier of pre-test counseling and lack of trust makes it a lot harder to identify patients with HIV. So once people are identified, it's much easier to get them on drug, keep them on drug, and there are mechanisms to take HIV medications where ability to pay is not a barrier at all. That's all been well established over the last two decades in the United States.

Yeah, well, MBA education, I'm sure that working together in person will be coming soon, and I think your students will appreciate that. Just by way of example, Robert, we've been working together since last July and having fun, and I look forward to meeting you for the first time in person.

All right, thank you Robert.