Ep135: John Maraganore on Developing a New Class of Medicines

So I am the very proud son of two Greek immigrants who came to this country. The name is unusual. Most people think I'm Italian or they don't really know what I am because there's no 'i' at the end. But I'm Greek. My original name was Melaganus, and it's an Ellis Island story of the name turning from Melaganus, which is notably Greek, to Maraganore, which is notably nothing. But it is that story. And my parents came to Chicago in the '50s. My father finished up his residency at the University of Chicago. He's a pathologist, or was a pathologist, and I was born in the early '60s. Wonderful time to be born.

I do. I've got an older brother who's a neurologist down at Tulane, and then I've got a younger sister who lives in Boston.

So we grew up in Rogers Park, and then we moved to Skokie, Illinois. And most of my life was in Skokie, but then I went to the University of Chicago for both my undergrad degree and my graduate degree. So I lived down in Hyde Park as well.

Well, I was actually a bit of a nerd, Luke, and loved doing, loved science. You know, my father was a pathologist, as I said. So he introduced me to science and medicine. And you know, pathologists have clinical labs, and I used to go work in the summer in his clinical lab, and basically learned all about, you know, blood samples and urine samples and testing and evaluation, and I loved it. Particularly loved doing pathology with the micro and cutting slices of tissues. So I learned my love of science and medicine from my father. But my mother gave me probably the most secret ingredient that's needed for a CEO, which is the ingredient of optimism. So the optimism from my mother and the love of science and medicine from my father made me who I am today.

Well, they were hell-bent on my brother and I becoming physicians. And I think my father's dream was that my brother and I would be part of a medical practice that we would have together, the Maraganore sons or something. And that never happened. He was disappointed. In fact, when I went to go get my PhD, my father, who's now passed, was very worried. He was convinced I'd just drive a taxi, that I'd never be able to, I'd never amount to anything and so forth. And he was sort of right.

I mean, Luke, I was so lucky to work with amazing people both when I was being trained in the academy by my thesis adviser and then another close mentor at the University of Chicago. But then the fact that my thesis adviser went into industry in the early '80s, and I had the opportunity of following him to do a post-doctoral study in industry, was what introduced me to basically biotech. And I made the decision at that point that I didn't want to be an academic scientist, which is what I originally thought I would do and just write grants and publish papers, but rather that I wanted to be involved in the endeavor of discovering medicines with other, you know, like-minded smart people.

You know, it was a very interesting time. So this is, we're talking about the early '80s. Biotech was just beginning. So the Upjohn company, which is where my thesis adviser went to, located in Kalamazoo, Michigan, they decided they were going to build up their own biotechnology center in, of all places, Kalamazoo. And they recruited a number of different academic leaders out of regional universities like Chicago to go help become sort of the nexus of that new biotechnology effort. And so that was my intro to it at the end of the day. You know, very, very, really remarkable period when, you know, everything looked possible with recombinant DNA. I mean, we were thinking about, you know, therapies, we were thinking about, you know, agricultural opportunities, we were thinking about veterinary opportunities. And so that was the world that I started my biotech career in, which, you know, is an exciting part of the biotech applications at the end.

I'll never forget, Luke, maybe some of you might remember this, those of you that are around my age, but there was a time, a front cover article around interferon and how interferon was going to be the cure for literally every disease in the world. And it featured, you know, a lot of people that I've subsequently gotten to know very well, people like Wally Gilbert and Phil Sharp and other people. But I remember coming home one Sunday from the university. I was doing my graduate work. My parents had a Time subscription. I saw the article. I read it voraciously, and I think at that point I sort of got the bug around where this could all go. If you could really take a protein, make it in a recombinant source, and then use it for human medicine, that would just be a powerful thing to, an exciting thing to be involved with.

So after, while I was at Upjohn, I decided I would leave that post-doctoral set of work and figure out the best place to go. And I applied to a number of companies. There was an opportunity at Schering-Plough, there was an opportunity at Biogen, and then there was an opportunity at ZymoGenetics. And I came out here, met with the group at Zymo, fell in love with the team, you know, met obviously with some of the founders like Earl Davie, one of the greats here at the University of Washington, and just thought it'd be exciting to be here working with that group of people. I mean, ZymoGenetics was really one of the frontier companies in recombinant DNA all across the world. And so being part of that group, being part of that team was really, really exciting. It's where I learned clotting of all things, and that turned out to, you know, show up later on my career a few times, which is good. But it was a very, very exciting company. So I made the decision to come out here. And I was recently married at that time with an ex-wife, and we only stayed here for a year and then we went to Boston. She didn't like Seattle. She didn't like Seattle. She didn't like, I don't know why, you know, it's a great city. I really like it out here, but it felt for her, it felt far away. So we ended up going to Boston where the discussion I had with Biogen from a previous discussion, you know, turned into a job offer, and I went there.

So I went to Biogen not to do clotting because that wasn't their focus, but rather to work on phospholipase inhibitors, which actually was the product of my thesis research of all things. But at Biogen there was always an opportunity for scientists in the lab, and I was a bench scientist at Biogen. There was an opportunity for scientists to use what they call 20% time to basically explore new things. And I started tinkering with the idea of making a thrombin inhibitor using the structure of the protein from the leech called hirudin, and so started working on sort of a peptide-based hirudin molecule, which ultimately became a drug that made it to market for the treatment of, or for the, you know, anticoagulation of patients during interventional cardiology procedures, a drug called Angiomax as it was ultimately called. But it was a really, really fun experience being involved in discovering a novel molecule, filing the IND with that molecule, and running the program all through development. Biogen ended up not taking it to market. We ended up stopping the program, focusing on Avonex, which, you know, was a great drug, multiple sclerosis, and we partnered the thrombin inhibitor program with The Medicines Company, which was the first of two seminal deals I did with The Medicines Company over the years, the second one being inclisiran, which happened much later.

Yeah, without a doubt. I mean, the 10 years I spent at Biogen, I really view as my postdoc, my seminal learning experience. I, you know, obviously was involved in drug discovery. I was involved in drug development. I then transitioned to be involved with business development and portfolio management, commercialization as well at Biogen. So it was just a fantastic experience. It's why, you know, a lot of young people ask me, how do I get started in the biotech industry? I tell them, go work in a larger cap or mid-to-larger cap biotech company like a Biogen, like a Vertex, like a Genentech, and learn about drug discovery, learn about drug development, learn about drug commercialization before you think you can really do it on your own. A lot of times young people just want to go off and be a CEO on day one, and I think that's just asking too much without a lot of experience.

No, it was 200.

It was a mid-sized company at the time. It was, you know, it was one of the five, six known biotechnology companies, right? I mean, you had, you know, you had Genentech and Amgen and Chiron and Biogen and Genetics Institute, and then Genzyme was sort of around too at that time, but that was it.

That's right.

That's exactly it. You know, and that's the beauty of that type of experience where, I mean, Jim Vincent was the CEO of Biogen at the time. He was just brought in. He was a storied CEO that came out of Abbott Labs and one of the most amazing people I ever had a chance to work with. You know, extremely strategic thinker, very, you know, people have polarized views on him as a leader, but I was in the camp of recognizing his strengths and benefiting from it. But it was great to learn from him. And then Vicki Sato was my direct boss. She, amazing scientific leader who still to this day I'm involved with and different things that we do together. But it's just a great example of learning from really terrific people that are there with you.

Oh, there you go. Okay.

Yeah. Well, in the summer of 2002, I had a phone call with Peter Barrett and John Francis Formelo, two partners over at Atlas Ventures, and they had just joined a syndicate along with Bob Nelson at Arch, who at the time was here in Seattle, as well as Christoph Westphal at Polaris and John Clark at Cardinal Partners around a new company called Alnylam. And they had already capitalized a company with $2.5 million. So it was just basically seed-funded at the time, and they were looking for the initial CEO. And they wanted me to come in and be part of this new company. And they wanted me to spend some time with Phil Sharp, who I knew from the Biogen days. He was a founder of Biogen. And I spent some time with Phil, got to learn a little bit about the technology. And over the summer, you know, began to really get infected with the idea of, you know, jumping in with RNA interference as a new technology because it was clear to me at the time that if we could figure out how to make drugs out of small interfering RNAs, the molecules that mediate RNAi, we could create a whole new class of medicines. It was clear that we had big challenges, that there were enormous technical obstacles to doing what we were aiming to do, namely around delivery of these molecules into cells. But we knew that if we could do it, if we could harness that natural mechanism, we could have a powerful new approach to medicine. And that was just too tempting not to jump into.

That's right.

Yeah. And a lot of other failed technologies at the time. There was antisense. Antisense gene therapy at the time was viewed as a, you know, failed technology. It's not now, but it was then. Antisense also has had success since then. But if you teleport back to 2002, it really was all small molecules and protein therapeutics, monoclonals and recombinant DNA proteins, and all these other more advanced modalities were, you know, pretty much disappointments.

Yeah. And the last part of what you said was the dream. The first part was the scary part. All right. These double-stranded large oligonucleotides, 14,000 daltons in molecular weight, prone to being degraded by enzymes in the body. No way those molecules are going to get across the cell membrane. They're really charged or really big. And so that was the scary part that we really had to figure out. You know, the good news is we had eyes wide open going into it. You know, we didn't have a quick, sanguine view that this was going to be easy. We knew it was going to be hard, and frankly, that made it exciting.

Well, we got started across a couple of different dimensions. I mean, the first thing we had to do was get a lot of money in the bank, and that was important. You know, we knew the original Alnylam business plan, and I remember telling Terry McGuire over at Polaris this plan, and Terry was like, 'Oh no, there's no way we could do that.' Like, 'Well, that's what it's going to take.' But our plan was that it would take us anywhere from $1 to $2 billion and 10 to 20 years to bring our first product to market. So that's the private business plan.

Well, you know, that was the plan that we did tell our investors at the time because that was what it would take. And, you know, frankly, we used data from Biogen, Genentech, Amgen, Chiron, all those companies. Now, look, we knew that along the way there would be many, many moments of time in which you would have strategic value inflection points so that you wouldn't be just throwing a billion dollars into the company on day one.

We were asking them for pennies compared to what we ultimately raised. I mean, you know, we raised, in my 20 years of being there, we raised over $7.5 billion, and we invested over $5 billion over that period of time. Now, half of that money came from selling equity, both in private and public markets, and the other half came from partnerships that we did with pharmaceutical companies, both in the form of upfront payments and R&D funding, etc. But it's amazing to think about all that capital that we got deployed, that got deployed ultimately in building a company.

Yeah. Well, let's start with the last one first. Delivery vehicles. So again, I commented before that we knew that delivery of these large molecules into the right cell types in the body safely was going to be the number one hurdle. And we really took two approaches at the beginning that gained traction. One was to use lipid nanoparticles as a way of delivering these molecules, and then the second was to use conjugates, so small molecule ligands that we would chemically link to the small interfering RNA to get a receptor-mediated uptake approach. And those two approaches ultimately panned out. Now, we can go into the stories of each of them. They were quite remarkable, but that's how we achieved delivery, to go to the last chapter in the book. But the other aspect of therapeutic area. So we were very, very focused on finding where the technology can go to make the most important medicines for patients regardless of the therapeutic area. And this is the story with any platform technology, whether it was Genentech with recombinant DNA or Regeneron with antibodies. You never, ever, ever, ever focus your strategy on a therapeutic area. You go where the technology can make the most important medicines, period. Right? With Genentech, they did insulin and growth hormone and tPA and Pulmozyme and all these different therapeutic areas. Regeneron, Eylea, Dupixent, co-antibodies, PD-1, you never focus on a therapeutic area. Go where the science can generate the most important medicine for patients. And that's what we did at Alnylam.

So we went public in 2004, and in our S-1, we had two targets and two programs that we named in our S-1. One was targeting VEGF for age-related macular degeneration, and the second was targeting alpha-synuclein for Parkinson's disease. Both of those programs never made it even into the clinic, and certainly never made it to market. So, you know, but that's where we thought it would be easiest. At first, we thought by going into local administration, either in the eye or in the CNS, that we might actually be able to achieve delivery. Little did we know that those were actually far more difficult than achieving systemic delivery of RNAi therapeutics to the liver, where using both lipid nanoparticles and conjugates given systemically, either intravenously or sub-Q, we actually got very robust and very successful delivery. The first clinical program for the company was targeting RSV, respiratory syncytial virus, with an aerosolized approach. That didn't work. You know, we did a Phase 2b. It narrowly missed its primary endpoint, but it didn't pan out. And again, the reason was it was not a robust delivery like we saw with liver targeting with either LNPs or conjugates.

We did.

So, you know, the one interesting thing about a platform like what we just, the journey we went through, is you also learn that you have to take prototypes of your technology into the clinic safely, safely with quality, of course, and then learn from those initial clinical findings and then come back. I'll give you an example. In our TTR program today, we have two products on the market. We've actually taken five programs into clinical development, five separate NCEs, two different lipid nanoparticles, one that ultimately made it, and three different conjugates, okay? One that ultimately made it, and one more that's still in development to be an even better version of the one that's on the market. So you have to be ready to go into man, learn from that early human translation, and have your research scientists optimize the platform in the research bench to then bring the better prototype forward, which might ultimately get to market.

I mean, partnerships are, if you're going to build a platform technology like we did, and I gave you the numbers before in terms of the amount of money that we had to raise, you have to do partnerships. There's no way, if your science and your platform is going to generate opportunities that are bigger than a breadbox, why not do partnerships as a way of getting funding to help you fund your platform better, getting funding to help support the development of your own pipeline, but also getting that additional validation. So the first deal we did was Merck in 2003. That was a very small starter deal. I would say $7.5 million upfront, but driven by Steve's, you know, real passion for this space and the science. And oftentimes, you know, these early deals are driven by the passion of an R&D leader to do something bold. And that friend, another great Seattleite, by the way, that's why I mentioned his name, I hope he's around somewhere up here on the islands, probably, but Steve, or in London actually these days, but Steve was that visionary, Harbison, who said, let's do a deal with Alnylam. And then we did one with Mark Fishman at Novartis in 2005, which was a much bigger deal. It was like $47 million upfront compared to the one from Merck. And then something happened that was really, in some ways, very good for us. Merck, jealous of our deal that we did with Novartis, decided that we're going to buy our competitor, which was Sirna Therapeutics. And they bought Sirna in 2006 for $1.1 billion. And that was really helpful for us because it set the price of an RNAi therapeutic company with a very robust premium. And that enabled us to then turn around and do a deal with Roche within the next six months for $331 million upfront, which at the time was by far the largest preclinical cash upfront.

At the time, we probably had about half that much.

Absolutely. Absolutely. And it was well-timed because it was right before the financial crisis and a lot of pharma companies throwing in the towel and saying this RNAi business is going to take too long. It's not really working. We need to prioritize other things.

And I still have that article next to my desk because it's a good reminder of what that time was like. But, you know, they all left. You know, the pharma industry, after dabbling with RNAi for a few years, finally realized that delivery was going to be harder than they appreciated. They also did something else, which hearkens back to what I commented before. They tried to fit the round peg into the square hole. They tried to make RNA interference work in oncology. That's where they wanted it to work. And they tried to force-fit it to be an oncology modality, but it didn't work in oncology because of delivery. And even to this day, there are no oncology RNAi drugs. But they insisted on trying to make it work for oncology. And we, you know, rejected that notion.

And it failed. And so, you know, we realized that oncology was not the best place to go after that experience with RNA interference. So we focused on where we could make hay ultimately.