"Executing differently takes courage" (4/5) - Biotech survival and resource allocation : why execution is about choosing what not to do

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I wanted to place this episode between Paul Brevetti and Mark de Garadell in fourth position in this mini-series on execution.

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Because it actually represents this moment of truth in execution,

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when resources are limited,

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when science is not enough,

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and when every decision can be the one that makes a company live or die.

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In early stage biotech,

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execution is not just a performance discipline.

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It's a survival discipline,

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and that's what Paul Brevetti and Mark de Garidel highlight.

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It's something radical.

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Executing is first and foremost about choosing.

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And choosing means accepting not to do everything and above all sticking to it.

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After markets,

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systems and geographic areas,

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we thus arrive at this barest level of execution.

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Two people,

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science,

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a question of how we finance and what we believe in.

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You don't die from dilution,

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but you die if you don't have cash.

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You have to know how to raise money when you have good news.

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You don't sell yourself,

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you get bought out.

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So if you're ultra focused all the time on your exit,

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you'll become a weathervane looking for opportunities and you won't really develop your core business.

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It's that the better you develop the company,

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the more likely you are to be acquired.

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We were one of the few oncology biotechs to have done this Series A last year,

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and it was extremely complicated.

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Now for us,

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the point is that we still have enough to see what's coming.

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This allows us to enter in good conditions to anticipate a future Series B,

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where we still go through storms,

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including Abivox.

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This episode was recorded with the support of Breenis Pharma.

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Hello everyone,

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welcome to this new episode of Pharma Minds.

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This time,

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I don't have just one guest,

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but I have two.

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Here we go,

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who should I start with?

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With Mark,

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let's go.

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Priority to the most experienced.

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Marc Garadel,

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the CEO of Abivax.

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Well,

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we're introducing it again,

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but there you go.

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Abivax is a French biotech that has its products in phase three beautifully.

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Hello,

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Marc.

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Hello.

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And then Paul Brevetti.

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Hello,

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Paul.

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Hello,

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Nathalie.

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Paul,

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who is therefore at the head of Brainers Pharma,

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an oncology biotech,

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starting its clinical trials.

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Very proud to be starting these clinical trials.

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Exactly.

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Very excited about these moments.

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Great.

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So what I suggest we cover today is innovation,

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valuing innovation.

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We'll talk about financing.

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We'll talk about execution and then end with...

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the best part,

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leadership,

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knowing how to hold the helm in these good times and also in these storms.

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To value innovation,

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I'll start perhaps with Paul.

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Do you want to present your science to us a bit?

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What is it?

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What do we do?

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Okay,

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absolutely.

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I'm the CEO of Brinus Pharma.

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So we're a startup from Lyon that develops new modalities in oncology.

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Our modalities are called in vivo immunotherapies,

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meaning we're able to educate the patient's immune system in vivo directly so that it can then target tumor cells that usually escape it and allow them to be destroyed as soon as they appear.

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So it's true that we're working on...

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what can be called disruptive technologies,

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even if it's sometimes a word that's a bit overused.

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We're on first in class,

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so purely innovation with all the challenges related to innovation.

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When you're a first modality,

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there's always ultimately a doubt that can set in.

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It's never been used in humans.

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And so right now we're in an extremely exciting phase for us because we've started our first clinical trials in humans in France and Belgium.

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One might tend to say it's easy for you,

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you're first in class.

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No,

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I think it's rather the opposite right now when you're in an economic context where you're looking for de-risking.

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Super interesting.

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And Mark,

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then,

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the science on the Abivax side?

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Abivax was the discovery of a remarkable molecule that essentially promotes the expression of MIR-124,

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which is a type of micro...

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This molecule's main mission is to temper and regulate inflammation.

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There's also disruption.

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It's also...

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It's a first in class.

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And so with all the anxieties there have been until now,

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because the environment is difficult,

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the economic environment,

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and investors don't really like things that are a bit disruptive.

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It seems a bit counterintuitive.

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You think if you want to make a difference,

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you actually have to go for disruption.

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You have to go for new things.

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But in reality,

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how do we manage that?

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How do we manage that?

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Well,

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we manage above all well.

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We have to try to get results fairly quickly,

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then try to clarify the science and show that as we progress,

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we're actually de-risking the molecule's progress and making it more and more interesting for patients.

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So that means you have to start well with your innovation,

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try to provide evidence that meets the standards,

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which are very reassuring.

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Is that it?

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How do we go about it?

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Yes,

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absolutely.

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I think you have to...

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You have to try to anticipate these different milestones and decide how to invest to reach them.

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Well,

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given this context again,

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which is a bit more complicated financially,

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you really have to prioritize.

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You can't go in all directions.

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Fundraising is also lower,

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so there's less possible investment too.

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And maybe to go back to what you said about it being counterintuitive,

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I don't think it's counterintuitive in the end,

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because an investment fund isn't really there just for pure development.

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It's actually there to help de-risk things and to invest when it honestly feels like it's going to work.

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What's a bit counterintuitive is that you sometimes see a gap between the current scientific consensus and investment funds.

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And that's because,

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given this context,

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some investment funds have spent a lot of time,

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well,

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working on reinvesting in their existing lines.

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So maybe a bit less time to go to conferences and stay informed.

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And in parallel,

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we also see many pharma companies that help guide us on,

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well,

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what the future is,

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where we need to take our innovation to also fit the criteria and not stray too far from what's expected.

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And that's one of our future advantages.

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We're going to enter a market where,

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especially when patients are very young,

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they're diagnosed at age 35.

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They don't want shots.

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They don't want infusions.

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And taking a pill once a day is much easier.

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Right.

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So we should bet on molecules like that?

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No,

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but it goes back to what we were saying.

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You have to accept that when you make first-in-class products,

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well,

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development is never very linear.

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We move forward.

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We don't have all the answers at the start,

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right?

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And so you need solid people.

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You need,

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well,

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you need solid.

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You need solid investors to appreciate that,

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well,

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not everything will succeed on day one.

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But we learn,

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and as we learn,

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well,

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we get closer and closer to the right goal.

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Right.

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And at what point do you think about market access?

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Well,

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I think there are obviously several stages.

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Basically,

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it still needs to be the technology,

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yes.

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But the principle of what we do,

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we still need an assessment,

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at least at a high level,

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of the therapeutic interest.

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And for me,

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the major milestone is still phase two.

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In my opinion,

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it's phase two that will determine everything.

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That's right.

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The design of phase two and how we're going to look at it.

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The design of phase two.

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the characteristics,

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which population we're going to target,

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and so on.

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And that's where differentiation becomes,

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in my view,

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essential.

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And it starts in phase two.

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And so the importance of phase two,

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as a result,

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we probably need to do a phase two that's a bit larger than one might think.

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It also de-risks phase three,

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because phase three trials,

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the costs are much higher.

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And so everything is decided in phase two,

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in my opinion.

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Right.

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And Paul,

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entering phase one,

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do you start to see who will be there,

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well,

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eventually in phase two?

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For us,

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from the very beginning,

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actually.

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From the start,

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meaning if I

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take the market access in a perhaps slightly broader sense that is with all the

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CMC development part and the manufacturing platform.

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For us,

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it was kind of Brennus'

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DNA.

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One of our co-founders actually comes from pharma development.

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So when we talked about trade-offs,

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we invested very early too.

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And it was perhaps a risk we took as well in the CMC platform,

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in the standardization parts.

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And now I think it's actually,

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it's turning into a positive point,

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in fact,

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in our project.

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Yeah,

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these are issues we've invested in heavily right now.

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Yeah.

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Thinking what?

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Thinking that it will stay as it is or that we also need to be able to bring creativity at the very end of the line?

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Well,

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in any case,

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creativity,

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it also comes based on the results we get.

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You know,

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it's still the results that dictate the value.

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And it's true that,

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for example,

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in oncology,

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all the combinations,

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the question of choosing which is the right one,

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what will be complementary to its mechanism of action to enhance efficacy and also try to maintain tolerance at the best possible level.

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So all of that is also a bit of an art as we go along.

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We move forward.

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And that's also what's extraordinary is that we shape.

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The product shapes itself over time through experiences.

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But the part highlighted by Paul is very important.

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It's indeed the CMC.

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It's that very often,

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especially in oral drugs,

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well,

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small molecules,

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it's less true because generally they're easy to produce.

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But in everything that is,

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let's say,

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in the living world,

274
00:07:39.092 --> 00:07:41.574
CMC is kind of the heart of the reactor.

275
00:07:41.974 --> 00:07:42.814
And I remember a talk,

276
00:07:42.815 --> 00:07:43.835
it was the head of Novartis,

277
00:07:43.836 --> 00:07:44.415
it was Vass,

278
00:07:45.076 --> 00:07:45.556
who said,

279
00:07:45.776 --> 00:07:46.236
for example,

280
00:07:46.256 --> 00:07:47.297
in business development,

281
00:07:47.397 --> 00:07:47.697
70%

282
00:07:48.477 --> 00:07:51.079
of the deals they look at for potential collaboration or to buy a company.

283
00:07:51.599 --> 00:07:51.879
70%

284
00:07:52.160 --> 00:07:54.321
of the deals don't happen because of the manufacturing part,

285
00:07:54.841 --> 00:08:01.126
because small companies don't master this production part well and don't guarantee that the product can be manufactured consistently without issues.

286
00:08:01.586 --> 00:08:03.448
And the newer and more complex the technologies are,

287
00:08:03.468 --> 00:08:04.709
the more it actually requires...

288
00:08:05.149 --> 00:08:05.790
To educate people.

289
00:08:06.150 --> 00:08:06.770
Also to explain,

290
00:08:06.810 --> 00:08:08.612
because inevitably you've bet on tests as well.

291
00:08:09.212 --> 00:08:11.294
Since you're using technologies that don't necessarily exist,

292
00:08:11.314 --> 00:08:12.535
you have to guide your CMC too.

293
00:08:13.015 --> 00:08:13.435
Fortunately,

294
00:08:13.495 --> 00:08:17.398
you have pre-meetings with regulatory bodies that also allow you to anticipate these issues.

295
00:08:18.179 --> 00:08:18.299
So...

296
00:08:18.615 --> 00:08:21.956
To wrap up and see what we can take away from this innovation valuation phase,

297
00:08:22.156 --> 00:08:23.636
it means you need a breakthrough innovation,

298
00:08:23.756 --> 00:08:25.857
but be able to de-risk as much as possible.

299
00:08:26.117 --> 00:08:27.157
To write the de-risking plan,

300
00:08:27.197 --> 00:08:27.517
that's it,

301
00:08:27.637 --> 00:08:28.518
as early as possible,

302
00:08:28.758 --> 00:08:28.938
right?

303
00:08:29.218 --> 00:08:29.438
Yes,

304
00:08:29.578 --> 00:08:29.758
yes.

305
00:08:30.098 --> 00:08:31.859
And then work with health authorities very early on,

306
00:08:32.319 --> 00:08:34.519
especially if we're really dealing with breakthrough innovations.

307
00:08:35.140 --> 00:08:35.380
Come on,

308
00:08:35.381 --> 00:08:37.860
I'd like your main takeaways for this part on how,

309
00:08:38.180 --> 00:08:40.641
what should be kept in mind to properly value an innovation.

310
00:08:41.141 --> 00:08:42.001
It's a bit like what we said,

311
00:08:42.021 --> 00:08:42.281
I think.

312
00:08:43.082 --> 00:08:44.582
Work well with health authorities early,

313
00:08:45.082 --> 00:08:45.442
clarify,

314
00:08:45.482 --> 00:08:47.623
clarify the added value of what we're going to do.

315
00:08:48.211 --> 00:09:04.765
have a plan that de-risks what we do over time and still have the support of the cores and the because it's obvious that that the medical establishment must support what you're doing you know yes and then actually anticipate milestones that we think should happen later because in the end we have collaborations and deals happening earlier and earlier actually you

316
00:09:04.766 --> 00:09:14.633
have to be ready yeah okay okay we can move on to financing uh here too you've each opted for a different strategy one is listed one is private how was this choice made who Who wants to start?

317
00:09:15.133 --> 00:09:15.253
No,

318
00:09:15.293 --> 00:09:17.155
but everything starts in private,

319
00:09:17.175 --> 00:09:17.395
you know.

320
00:09:17.819 --> 00:09:19.821
All companies basically don't start out listed.

321
00:09:20.261 --> 00:09:20.562
I see.

322
00:09:21.182 --> 00:09:21.342
Yes,

323
00:09:21.362 --> 00:09:22.323
it's actually very rare,

324
00:09:22.383 --> 00:09:24.405
even if a few years ago in 2020,

325
00:09:24.445 --> 00:09:25.486
at least in the United States,

326
00:09:25.826 --> 00:09:29.990
there was a bit of significant optimism and very early stage companies were listed.

327
00:09:30.310 --> 00:09:31.191
But generally speaking,

328
00:09:31.192 --> 00:09:34.514
the progression is that you're funded by private investors,

329
00:09:34.915 --> 00:09:35.035
who,

330
00:09:35.055 --> 00:09:35.415
by the way,

331
00:09:35.455 --> 00:09:39.799
have slightly different profiles as we move forward in the development of the molecule and the company.

332
00:09:40.560 --> 00:09:41.140
And then indeed,

333
00:09:41.300 --> 00:09:42.602
there's a moment when you have to know,

334
00:09:42.622 --> 00:09:44.083
do I go to the stock market or not?

335
00:09:44.531 --> 00:09:47.600
And the main reason people go to the stock market is simply because the increase,

336
00:09:47.961 --> 00:09:49.846
the financing needs increase enormously.

337
00:09:50.583 --> 00:09:53.004
And so it's easier to raise money when it's listed.

338
00:09:53.544 --> 00:09:55.945
And also it allows investors who have been there for five,

339
00:09:56.005 --> 00:09:58.606
ten years sometimes to be able to exit and let others in.

340
00:09:59.106 --> 00:09:59.427
There you go.

341
00:09:59.487 --> 00:09:59.927
So that the,

342
00:10:00.127 --> 00:10:00.387
let's say,

343
00:10:00.447 --> 00:10:01.968
virtuous cycle of development continues.

344
00:10:02.348 --> 00:10:03.588
So that's the main thing.

345
00:10:03.888 --> 00:10:05.429
But we all start as a private company.

346
00:10:05.889 --> 00:10:06.970
And then as we go along,

347
00:10:06.990 --> 00:10:07.510
the question is,

348
00:10:07.710 --> 00:10:09.391
do I stay private or am I listed?

349
00:10:09.791 --> 00:10:10.111
Abivax,

350
00:10:10.171 --> 00:10:11.111
we did it in two stages,

351
00:10:11.112 --> 00:10:11.351
you know,

352
00:10:11.672 --> 00:10:13.752
because we did it in 2015 on the first human trials.

353
00:10:14.313 --> 00:10:14.833
At that point,

354
00:10:14.913 --> 00:10:16.594
it was listed on the Paris Stock Exchange.

355
00:10:17.314 --> 00:10:19.115
The company raised roughly 60 million euros.

356
00:10:19.675 --> 00:10:19.875
Right.

357
00:10:20.183 --> 00:10:21.644
Then on a slightly larger scale,

358
00:10:21.645 --> 00:10:22.325
a few years later,

359
00:10:22.326 --> 00:10:23.065
we did the NASDAQ.

360
00:10:23.626 --> 00:10:24.967
It was roughly four times that amount.

361
00:10:25.668 --> 00:10:27.249
And was that timing basically the right one,

362
00:10:27.269 --> 00:10:28.170
the timing to follow,

363
00:10:28.530 --> 00:10:30.532
meaning doing it once at the start and once later on?

364
00:10:30.792 --> 00:10:30.912
Well,

365
00:10:30.932 --> 00:10:31.773
I think one of the rules,

366
00:10:32.393 --> 00:10:32.954
and in my opinion,

367
00:10:32.974 --> 00:10:34.335
that's where we in France need to learn.

368
00:10:34.635 --> 00:10:36.096
Because if you take the example of Abivax,

369
00:10:36.597 --> 00:10:38.758
what should have been done was when we had good results.

370
00:10:39.259 --> 00:10:41.220
So from phase 2B in 2021,

371
00:10:41.400 --> 00:10:41.841
at that point,

372
00:10:41.861 --> 00:10:43.662
we should have gone to the NASDAQ to raise a lot of money.

373
00:10:44.123 --> 00:10:45.444
And when you have good clinical news,

374
00:10:45.724 --> 00:10:46.665
when you have good results,

375
00:10:46.985 --> 00:10:48.186
it's always the right time to raise money.

376
00:10:48.686 --> 00:10:49.187
Even if some...

377
00:10:49.943 --> 00:10:51.064
Investors don't like dilution.

378
00:10:51.124 --> 00:10:52.045
You don't die from dilution,

379
00:10:52.085 --> 00:10:53.226
but you die if you don't have cash.

380
00:10:53.886 --> 00:10:54.427
Die of hunger.

381
00:10:54.547 --> 00:10:56.609
So you have to know how to raise money when you have good news.

382
00:10:57.369 --> 00:10:58.010
And then once again,

383
00:10:58.011 --> 00:10:58.570
the question is,

384
00:10:59.051 --> 00:11:01.333
if you want to go to the public markets to do a listing,

385
00:11:01.813 --> 00:11:03.274
then it's actually prepared one step ahead.

386
00:11:03.775 --> 00:11:05.737
You have to do a fundraising round with investors,

387
00:11:06.337 --> 00:11:08.099
known as a crossover in the industry jargon.

388
00:11:08.739 --> 00:11:11.281
So these are investors who will anchor the success of the IPO,

389
00:11:11.742 --> 00:11:13.903
who will not only put money into the final private round,

390
00:11:14.904 --> 00:11:17.146
but they're the ones who will ensure that when you do the IPO,

391
00:11:17.286 --> 00:11:17.887
they'll guarantee.

392
00:11:18.571 --> 00:11:19.351
that you'll have at least,

393
00:11:19.371 --> 00:11:19.691
let's say,

394
00:11:19.791 --> 00:11:19.951
80%

395
00:11:20.332 --> 00:11:21.292
of the amount available,

396
00:11:21.772 --> 00:11:23.392
which helps attract other investors.

397
00:11:23.753 --> 00:11:23.893
Okay,

398
00:11:23.913 --> 00:11:24.993
so those are generally the steps.

399
00:11:25.493 --> 00:11:25.933
And okay,

400
00:11:26.153 --> 00:11:27.093
and when that hasn't been done,

401
00:11:27.094 --> 00:11:27.634
for example,

402
00:11:27.674 --> 00:11:29.034
with positive phase two results?

403
00:11:29.514 --> 00:11:29.634
Well,

404
00:11:29.654 --> 00:11:30.354
because for Abivax,

405
00:11:30.454 --> 00:11:33.115
there was a lot of enthusiasm because the results were very interesting.

406
00:11:33.715 --> 00:11:34.516
And I think at the time,

407
00:11:34.517 --> 00:11:36.976
the board of directors thought that they could sell the company,

408
00:11:37.256 --> 00:11:39.897
but they didn't sell the company and the cash dwindled over time.

409
00:11:40.157 --> 00:11:41.258
There was phase three to launch.

410
00:11:41.658 --> 00:11:42.858
It delayed the launch of phase three.

411
00:11:43.098 --> 00:11:43.218
Well,

412
00:11:43.238 --> 00:11:45.499
it's surely these are decisions that with hindsight,

413
00:11:45.500 --> 00:11:45.959
you realize.

414
00:11:46.443 --> 00:11:46.803
Dilution,

415
00:11:46.804 --> 00:11:47.123
of course,

416
00:11:47.163 --> 00:11:49.104
it's not very pleasant for investors to raise more money,

417
00:11:49.564 --> 00:11:50.944
but not having any money is even worse.

418
00:11:51.384 --> 00:11:52.805
And this decision to want to sell it too?

419
00:11:53.225 --> 00:11:54.505
To want to prepare a company for sale?

420
00:11:54.645 --> 00:11:54.765
Well,

421
00:11:54.845 --> 00:11:55.646
we know Mark's opinion,

422
00:11:55.706 --> 00:11:55.826
but...

423
00:11:56.286 --> 00:11:56.406
No,

424
00:11:56.486 --> 00:11:57.606
but once again,

425
00:11:57.646 --> 00:11:58.246
from my point of view,

426
00:11:58.767 --> 00:12:00.407
wanting to sell a company is a mistake.

427
00:12:00.827 --> 00:12:00.987
Well,

428
00:12:01.567 --> 00:12:01.787
on the...

429
00:12:02.128 --> 00:12:03.228
From a philosophical standpoint,

430
00:12:03.268 --> 00:12:03.428
right?

431
00:12:03.688 --> 00:12:03.828
Yes,

432
00:12:03.868 --> 00:12:04.428
because in fact,

433
00:12:04.848 --> 00:12:08.389
the great danger when you're obsessed with selling is that when you develop your company,

434
00:12:08.809 --> 00:12:09.690
you'll do things thinking,

435
00:12:09.750 --> 00:12:09.890
well,

436
00:12:09.950 --> 00:12:11.830
I'm not going to do that because we're going to sell the company.

437
00:12:12.150 --> 00:12:12.450
Best.

438
00:12:12.631 --> 00:12:12.751
Well,

439
00:12:12.811 --> 00:12:13.511
I'm not going to do that,

440
00:12:13.531 --> 00:12:13.651
etc.

441
00:12:15.011 --> 00:12:15.632
and as a result,

442
00:12:15.652 --> 00:12:17.392
what happens is you don't develop the drug properly.

443
00:12:17.853 --> 00:12:17.993
Now,

444
00:12:17.994 --> 00:12:21.814
the mission of a biotech company is to try to advance a good drug as much as possible,

445
00:12:21.874 --> 00:12:22.935
even if it means marketing it,

446
00:12:23.515 --> 00:12:24.275
and that's the mindset.

447
00:12:24.276 --> 00:12:25.476
You have to try to do everything well.

448
00:12:25.976 --> 00:12:27.056
If you start telling yourself,

449
00:12:27.497 --> 00:12:29.117
dreaming of making money by selling your thing,

450
00:12:29.177 --> 00:12:29.337
well,

451
00:12:29.498 --> 00:12:30.938
I can tell you it's not a very good thing.

452
00:12:31.518 --> 00:12:31.959
And besides,

453
00:12:31.979 --> 00:12:34.820
my personal experience is that the better you develop the company,

454
00:12:34.860 --> 00:12:36.220
the more likely you are to be bought,

455
00:12:36.701 --> 00:12:37.321
because big pharma,

456
00:12:37.461 --> 00:12:37.861
precisely,

457
00:12:37.901 --> 00:12:38.601
they want to de-risk.

458
00:12:38.641 --> 00:12:42.223
They don't want to take experience shows that developing a drug is already very risky.

459
00:12:42.559 --> 00:12:46.341
Only one in 10 products that enter human trials actually ends up being approved by health authorities.

460
00:12:46.801 --> 00:12:49.482
So my advice is to develop your thing well,

461
00:12:50.222 --> 00:12:50.862
make a good drug,

462
00:12:51.003 --> 00:12:53.644
and then whether you market it yourself or through another lab,

463
00:12:53.704 --> 00:12:54.684
that's a secondary question.

464
00:12:55.084 --> 00:12:56.045
I completely agree with that.

465
00:12:56.425 --> 00:12:57.305
There's an important phrase,

466
00:12:57.306 --> 00:12:58.165
you don't sell yourself,

467
00:12:58.265 --> 00:12:58.926
you get bought out.

468
00:12:59.406 --> 00:13:01.187
If you're constantly hyper-focused on your exit,

469
00:13:01.507 --> 00:13:03.207
you'll become a weather vane chasing opportunities.

470
00:13:03.608 --> 00:13:05.148
And you won't develop your core business,

471
00:13:05.328 --> 00:13:06.449
which is what creates your value.

472
00:13:06.909 --> 00:13:08.270
I think that's a fundamental point.

473
00:13:09.050 --> 00:13:09.170
Now,

474
00:13:09.190 --> 00:13:11.691
there's also a need and investment funds push you to do it.

475
00:13:12.335 --> 00:13:13.836
We were talking a lot about equity story.

476
00:13:14.537 --> 00:13:15.398
You also have to work on it,

477
00:13:15.399 --> 00:13:15.758
of course.

478
00:13:15.878 --> 00:13:16.478
Your exit story,

479
00:13:16.518 --> 00:13:17.760
you have to know where you're going.

480
00:13:18.200 --> 00:13:20.862
I don't think that should be what dictates your investment decisions.

481
00:13:21.162 --> 00:13:22.784
But then the Abivax example,

482
00:13:22.824 --> 00:13:23.824
maybe they also tell themselves,

483
00:13:23.885 --> 00:13:24.145
actually,

484
00:13:24.146 --> 00:13:24.945
we won't know how to do it.

485
00:13:25.206 --> 00:13:25.466
I mean,

486
00:13:25.746 --> 00:13:26.787
our expertise ends there.

487
00:13:27.247 --> 00:13:28.829
It's true that once you reach commercialization,

488
00:13:28.849 --> 00:13:29.749
it becomes a different matter.

489
00:13:30.050 --> 00:13:31.170
Even executing a phase three.

490
00:13:31.471 --> 00:13:31.631
Yes,

491
00:13:31.671 --> 00:13:32.111
absolutely.

492
00:13:32.512 --> 00:13:35.954
Some might have said it's too big a leap forward to do it ourselves.

493
00:13:36.235 --> 00:13:37.356
And that could justify an exit.

494
00:13:37.816 --> 00:13:39.918
But that doesn't change the fact that money had to be raised anyway.

495
00:13:40.238 --> 00:13:40.358
Yeah,

496
00:13:40.578 --> 00:13:41.459
to make something substantial.

497
00:13:41.715 --> 00:13:42.956
To make something more substantial.

498
00:13:43.236 --> 00:13:43.516
To be,

499
00:13:43.576 --> 00:13:44.116
in any case,

500
00:13:44.136 --> 00:13:46.337
in a strong negotiating position with big pharma.

501
00:13:46.637 --> 00:13:47.417
To actually face them,

502
00:13:47.697 --> 00:13:48.038
exactly.

503
00:13:48.398 --> 00:13:48.578
Yes,

504
00:13:48.638 --> 00:13:49.278
because in any case,

505
00:13:49.318 --> 00:13:50.278
it's all about negotiation.

506
00:13:50.579 --> 00:13:50.719
Yeah.

507
00:13:51.119 --> 00:13:53.360
You always need to have money in your war chest.

508
00:13:53.780 --> 00:13:54.760
When you do a dual track,

509
00:13:54.880 --> 00:13:57.141
it also shows that you're capable of doing it on your own too.

510
00:13:57.441 --> 00:13:58.062
Doing it yourself,

511
00:13:58.162 --> 00:13:58.402
you know,

512
00:13:58.422 --> 00:13:59.922
you increase your valuation on one side.

513
00:14:00.262 --> 00:14:01.283
It's a bit of a power struggle.

514
00:14:01.703 --> 00:14:02.363
So regarding that,

515
00:14:02.383 --> 00:14:02.984
what does it mean?

516
00:14:03.344 --> 00:14:04.724
Does it mean it's a matter of competence?

517
00:14:05.044 --> 00:14:06.285
Is it about being well surrounded?

518
00:14:06.485 --> 00:14:07.545
Is it a matter of mindset?

519
00:14:07.926 --> 00:14:08.266
What is it?

520
00:14:08.646 --> 00:14:08.766
Well,

521
00:14:08.786 --> 00:14:09.006
I mean...

522
00:14:09.306 --> 00:14:09.966
Clinical results too.

523
00:14:10.086 --> 00:14:10.307
I mean,

524
00:14:10.347 --> 00:14:10.867
having the results,

525
00:14:10.868 --> 00:14:11.227
of course.

526
00:14:11.659 --> 00:14:11.839
Yes,

527
00:14:11.899 --> 00:14:12.059
yes.

528
00:14:12.360 --> 00:14:14.621
But then it's true that if we want to list,

529
00:14:14.941 --> 00:14:16.002
if we go back to the listing,

530
00:14:16.302 --> 00:14:19.044
it's true that it's still a major change for the company in the way it operates.

531
00:14:19.665 --> 00:14:21.226
You are forced to do reporting.

532
00:14:21.866 --> 00:14:23.267
You're constantly with financial analysts,

533
00:14:23.268 --> 00:14:23.848
with investors.

534
00:14:24.608 --> 00:14:25.049
For Abivax,

535
00:14:25.089 --> 00:14:25.449
I spend,

536
00:14:25.549 --> 00:14:25.709
well,

537
00:14:25.749 --> 00:14:27.190
obviously our reputation is now global,

538
00:14:27.931 --> 00:14:28.911
but I spend more than 50%

539
00:14:29.151 --> 00:14:29.692
of my time.

540
00:14:29.952 --> 00:14:30.953
I spent all of last week,

541
00:14:30.993 --> 00:14:31.533
I was in Miami,

542
00:14:31.573 --> 00:14:32.174
I was in New York.

543
00:14:32.914 --> 00:14:33.875
I'm in demand every day,

544
00:14:34.215 --> 00:14:34.896
almost every afternoon.

545
00:14:35.196 --> 00:14:36.357
I spend my time with investors.

546
00:14:37.017 --> 00:14:38.938
So it's still a fairly sudden change in there.

547
00:14:39.379 --> 00:14:39.619
And so...

548
00:14:39.919 --> 00:14:40.801
That's why when you do that,

549
00:14:40.821 --> 00:14:44.848
you need to have teams below you who are as competent as possible to move the projects forward.

550
00:14:45.750 --> 00:14:45.950
Right,

551
00:14:46.030 --> 00:14:46.230
okay.

552
00:14:46.591 --> 00:14:46.892
Honestly,

553
00:14:46.952 --> 00:14:47.392
otherwise,

554
00:14:47.453 --> 00:14:49.075
I'm not the one moving things forward much,

555
00:14:49.476 --> 00:14:50.879
even if I oversee a number of things.

556
00:14:51.603 --> 00:14:54.084
But the transition in any case to listing also has,

557
00:14:54.804 --> 00:14:56.244
you need a very good chief financial officer.

558
00:14:56.765 --> 00:14:56.985
I mean,

559
00:14:56.986 --> 00:14:57.865
it's a whole operation.

560
00:14:58.385 --> 00:14:59.865
There are accounting standards and so on.

561
00:15:00.166 --> 00:15:01.106
Then it costs money too.

562
00:15:01.286 --> 00:15:01.526
You see,

563
00:15:01.546 --> 00:15:02.286
as a private company,

564
00:15:02.306 --> 00:15:03.947
we naturally asked ourselves about listing.

565
00:15:04.547 --> 00:15:04.747
Then,

566
00:15:05.147 --> 00:15:07.088
even if at the time of the Series A we did last year,

567
00:15:07.328 --> 00:15:09.828
ultimately the economic market on Euronext was catastrophic.

568
00:15:10.249 --> 00:15:11.909
And so then we didn't want to chase the listing.

569
00:15:12.229 --> 00:15:13.490
So it was clearly set aside.

570
00:15:13.930 --> 00:15:16.250
Then there's always the part where we list on NASDAQ at some point,

571
00:15:16.290 --> 00:15:18.331
because ultimately that's also what allows you to sustain.

572
00:15:18.775 --> 00:15:19.315
And as you said,

573
00:15:19.316 --> 00:15:23.336
to also very quickly increase your financing capacities and much faster than on the private side.

574
00:15:23.776 --> 00:15:23.916
Now,

575
00:15:23.976 --> 00:15:24.757
it costs a lot of money,

576
00:15:24.817 --> 00:15:24.957
too.

577
00:15:25.537 --> 00:15:27.858
So you have to look closely at the company stage of development.

578
00:15:28.198 --> 00:15:28.998
For us in phase one,

579
00:15:29.258 --> 00:15:29.718
it's too early.

580
00:15:29.798 --> 00:15:30.238
It's too early.

581
00:15:30.818 --> 00:15:32.079
But it can remain an open option,

582
00:15:32.299 --> 00:15:32.559
indeed,

583
00:15:32.560 --> 00:15:33.219
in a dual track,

584
00:15:33.379 --> 00:15:33.859
triple track,

585
00:15:33.979 --> 00:15:34.179
too,

586
00:15:34.339 --> 00:15:35.500
which can be set up in the future.

587
00:15:35.880 --> 00:15:36.680
And this milestone,

588
00:15:36.681 --> 00:15:37.080
is that it?

589
00:15:37.340 --> 00:15:38.060
Going to Nasdaq,

590
00:15:38.080 --> 00:15:39.321
it becomes almost mandatory,

591
00:15:39.401 --> 00:15:39.621
right?

592
00:15:40.121 --> 00:15:40.821
That is to say that,

593
00:15:41.161 --> 00:15:41.301
well,

594
00:15:41.341 --> 00:15:42.081
if you take Abivax,

595
00:15:42.462 --> 00:15:43.882
when we looked into raising a lot of money,

596
00:15:44.222 --> 00:15:47.483
we had to raise at least $250 million because of phase three.

597
00:15:47.919 --> 00:15:49.439
We made a list of investors worldwide.

598
00:15:49.820 --> 00:15:52.040
It was still quite oriented towards the US and Europe.

599
00:15:52.480 --> 00:15:53.200
The banks helped us.

600
00:15:53.801 --> 00:15:54.781
Out of 200 investors,

601
00:15:54.801 --> 00:15:56.561
180 were in the United States.

602
00:15:56.821 --> 00:15:57.802
So you can do a lot in Europe,

603
00:15:57.803 --> 00:15:58.662
but you are very limited.

604
00:15:59.182 --> 00:16:00.943
If you want to raise fairly large amounts of money,

605
00:16:01.383 --> 00:16:03.083
going to the US is almost indispensable.

606
00:16:03.583 --> 00:16:03.703
Now,

607
00:16:03.743 --> 00:16:05.784
there's also the Hong Kong Stock Exchange,

608
00:16:05.864 --> 00:16:07.824
which is growing thanks to Chinese development too.

609
00:16:08.285 --> 00:16:09.665
But the preferred route is NASDAQ.

610
00:16:10.245 --> 00:16:11.425
That's where you have the best analysts.

611
00:16:11.465 --> 00:16:12.666
That's where you have the best investors.

612
00:16:13.346 --> 00:16:17.147
That's where you are faced with the toughness and the high standards of those people.

613
00:16:17.699 --> 00:16:19.240
And that's where you grow the most because,

614
00:16:19.481 --> 00:16:19.721
you know,

615
00:16:19.781 --> 00:16:21.022
when you're dealing with these investors,

616
00:16:21.622 --> 00:16:24.345
you learn a lot and they've been through so many stories themselves.

617
00:16:24.865 --> 00:16:26.967
They've seen so many things and it makes you stronger,

618
00:16:27.167 --> 00:16:27.487
obviously.

619
00:16:28.208 --> 00:16:28.388
Right.

620
00:16:28.408 --> 00:16:29.529
And then there's also the question,

621
00:16:29.769 --> 00:16:32.271
even beyond that side of things in the United States,

622
00:16:32.291 --> 00:16:34.193
it's about when a biotech should set up in the States,

623
00:16:34.253 --> 00:16:35.114
even with a headquarters.

624
00:16:35.875 --> 00:16:36.315
So for us,

625
00:16:36.355 --> 00:16:37.936
we've really asked ourselves that question.

626
00:16:37.937 --> 00:16:38.597
We also looked at,

627
00:16:38.637 --> 00:16:38.797
well,

628
00:16:38.817 --> 00:16:39.758
how much it would cost us.

629
00:16:40.198 --> 00:16:41.639
So it's no secret,

630
00:16:41.680 --> 00:16:41.820
right?

631
00:16:41.821 --> 00:16:42.800
If you set up in Boston,

632
00:16:42.840 --> 00:16:45.203
you'll have fixed costs that are quite high from the headquarters,

633
00:16:45.243 --> 00:16:45.523
from the...

634
00:16:46.367 --> 00:16:48.008
From the employees you're going to hire on site.

635
00:16:48.768 --> 00:16:51.069
So what we've put in place is a sort of soft landing.

636
00:16:51.449 --> 00:16:51.869
So in fact,

637
00:16:51.909 --> 00:16:53.250
we've set up collaborations on site.

638
00:16:53.930 --> 00:16:55.291
We have independent board members too,

639
00:16:55.571 --> 00:16:56.671
who are part of Brenus and who,

640
00:16:56.731 --> 00:16:56.891
well,

641
00:16:57.132 --> 00:16:57.852
are based in Boston,

642
00:16:57.872 --> 00:16:58.512
based in the US,

643
00:16:58.812 --> 00:16:59.353
and will also,

644
00:16:59.453 --> 00:16:59.633
well,

645
00:16:59.953 --> 00:17:02.034
be able to echo what we can do in Europe.

646
00:17:02.794 --> 00:17:03.074
We're very,

647
00:17:03.134 --> 00:17:04.295
very present there too in the end.

648
00:17:04.575 --> 00:17:06.035
I'm very present in the United States.

649
00:17:06.456 --> 00:17:07.176
And I think for us,

650
00:17:07.276 --> 00:17:10.437
the right time will be when we have the IND from the FDA validated.

651
00:17:10.957 --> 00:17:11.798
So we made a submission,

652
00:17:11.858 --> 00:17:12.698
a submission recently.

653
00:17:12.699 --> 00:17:13.418
We might have one in Q1,

654
00:17:13.419 --> 00:17:14.399
2026.

655
00:17:15.107 --> 00:17:16.208
So then we can ask ourselves,

656
00:17:16.268 --> 00:17:16.408
say,

657
00:17:16.468 --> 00:17:16.588
well,

658
00:17:16.628 --> 00:17:18.449
now's the right time to enter with a clinical trial.

659
00:17:18.489 --> 00:17:20.650
That's also starting in the US and to start investing.

660
00:17:21.051 --> 00:17:23.432
And going back to the stories of dilution,

661
00:17:23.612 --> 00:17:24.413
of loss of control,

662
00:17:25.013 --> 00:17:26.074
how should that be looked at as well?

663
00:17:26.514 --> 00:17:26.654
Well,

664
00:17:26.694 --> 00:17:29.976
that's a dialogue between the investors on one hand and the management,

665
00:17:30.056 --> 00:17:30.256
right?

666
00:17:30.516 --> 00:17:33.258
The management itself is mainly there to execute,

667
00:17:33.398 --> 00:17:34.199
to develop the drug.

668
00:17:34.979 --> 00:17:35.580
The investors,

669
00:17:36.500 --> 00:17:41.103
it's up to them to exactly to agree among themselves and then to have this evolution.

670
00:17:41.559 --> 00:17:42.039
compared to,

671
00:17:42.500 --> 00:17:42.820
once again,

672
00:17:42.860 --> 00:17:45.142
those who arrive and are more specialized in early stage,

673
00:17:45.143 --> 00:17:45.963
in early development,

674
00:17:46.403 --> 00:17:48.725
from those who are more into the scale up,

675
00:17:49.105 --> 00:17:49.726
because each one,

676
00:17:49.786 --> 00:17:50.126
once again,

677
00:17:50.166 --> 00:17:51.687
brings their skills.

678
00:17:52.068 --> 00:17:56.071
And so everything is actually in the art of progressing,

679
00:17:56.711 --> 00:17:58.313
since as the company evolves,

680
00:17:58.713 --> 00:17:59.434
it's a team effort,

681
00:17:59.594 --> 00:17:59.834
you know,

682
00:18:00.354 --> 00:18:01.315
the development of a drug.

683
00:18:01.716 --> 00:18:03.357
There's obviously the management team and so on.

684
00:18:03.897 --> 00:18:04.698
There are the doctors,

685
00:18:04.778 --> 00:18:05.699
the centers and so on.

686
00:18:06.139 --> 00:18:06.780
But the investors,

687
00:18:06.781 --> 00:18:08.361
they have a lot of added value to bring as well.

688
00:18:09.242 --> 00:18:10.663
And what's needed is to try to find...

689
00:18:10.943 --> 00:18:11.303
exactly,

690
00:18:12.124 --> 00:18:13.024
a syndicate of,

691
00:18:13.204 --> 00:18:13.565
as they say,

692
00:18:13.605 --> 00:18:14.925
investors who also get along well,

693
00:18:16.026 --> 00:18:18.247
because sometimes they can also butt heads a bit from time to time.

694
00:18:19.768 --> 00:18:20.949
And that's not good for the company.

695
00:18:21.009 --> 00:18:22.230
And it's not good for the management.

696
00:18:22.490 --> 00:18:23.631
It's not good for the product either.

697
00:18:23.711 --> 00:18:24.771
They have to buy into a project,

698
00:18:24.791 --> 00:18:25.152
basically.

699
00:18:25.512 --> 00:18:25.632
Yeah,

700
00:18:25.633 --> 00:18:26.472
they have to buy a project.

701
00:18:26.512 --> 00:18:26.833
Exactly.

702
00:18:26.853 --> 00:18:27.233
They have to...

703
00:18:27.933 --> 00:18:32.156
The story has to be clear and they have to either want to go for it or they leave.

704
00:18:32.616 --> 00:18:32.996
Exactly.

705
00:18:33.757 --> 00:18:37.039
But the question of valuation is quite complex right now in the early stage.

706
00:18:37.367 --> 00:18:38.428
Because you have many,

707
00:18:38.488 --> 00:18:39.969
many companies that are in liquidation,

708
00:18:40.029 --> 00:18:41.890
so they're raising funds to replenish their coffers.

709
00:18:42.591 --> 00:18:44.352
So they're more or less forced to lay themselves bare,

710
00:18:44.392 --> 00:18:44.652
actually,

711
00:18:44.672 --> 00:18:45.173
in terms of that,

712
00:18:45.833 --> 00:18:47.975
which also has an impact on the valuation environment,

713
00:18:48.015 --> 00:18:48.275
actually.

714
00:18:48.575 --> 00:18:49.256
And that means that,

715
00:18:49.816 --> 00:18:49.956
well,

716
00:18:49.996 --> 00:18:50.797
you're pulled down a bit,

717
00:18:50.877 --> 00:18:52.278
even if you have an interesting tech,

718
00:18:52.338 --> 00:18:54.039
even if you're quite well-founded to begin with.

719
00:18:54.479 --> 00:18:54.720
And so,

720
00:18:55.280 --> 00:18:55.500
indeed,

721
00:18:55.640 --> 00:18:59.243
this question of not diluting too much becomes important because afterwards you have valuations,

722
00:18:59.263 --> 00:19:00.223
you're starting from very low.

723
00:19:00.704 --> 00:19:00.904
Now,

724
00:19:01.384 --> 00:19:03.005
you also have milestones that have comparables.

725
00:19:03.666 --> 00:19:04.927
So you also managed to try and say.

726
00:19:05.247 --> 00:19:05.367
Now,

727
00:19:05.427 --> 00:19:05.547
OK,

728
00:19:05.667 --> 00:19:06.627
we might do a big raise,

729
00:19:06.647 --> 00:19:07.328
but we'll tranche it.

730
00:19:07.348 --> 00:19:09.308
We'll try to agree that if we reach this milestone,

731
00:19:09.328 --> 00:19:10.488
there will be a valuation gap.

732
00:19:10.929 --> 00:19:11.309
Currently,

733
00:19:11.469 --> 00:19:13.629
it's more about trying to avoid the downside that's happening.

734
00:19:13.729 --> 00:19:16.550
But I hope that in the coming months we'll return to a positive period.

735
00:19:17.010 --> 00:19:17.250
Indeed,

736
00:19:17.550 --> 00:19:18.030
it's a question.

737
00:19:18.130 --> 00:19:21.131
It's a delicate balance to maintain between your investors and your future investors,

738
00:19:21.151 --> 00:19:21.311
too.

739
00:19:21.451 --> 00:19:22.452
And the funding needs you have,

740
00:19:22.472 --> 00:19:22.692
you know.

741
00:19:23.072 --> 00:19:24.732
And so to protect yourself from all that,

742
00:19:24.792 --> 00:19:24.952
it's...

743
00:19:25.212 --> 00:19:26.473
Protecting yourself isn't very easy.

744
00:19:26.913 --> 00:19:27.833
If I look back at history,

745
00:19:28.213 --> 00:19:29.253
what happened was in 2020,

746
00:19:29.954 --> 00:19:31.214
there were all the investors who were,

747
00:19:31.294 --> 00:19:31.674
let's say,

748
00:19:32.114 --> 00:19:32.814
in early stage,

749
00:19:33.095 --> 00:19:34.735
who made a lot of money because they exited.

750
00:19:35.203 --> 00:19:37.345
Companies did IPOs at astronomical valuations.

751
00:19:37.785 --> 00:19:38.786
So then those investors,

752
00:19:38.806 --> 00:19:39.466
they were very happy.

753
00:19:39.967 --> 00:19:40.547
Those who bought,

754
00:19:40.607 --> 00:19:41.628
those who continued the story,

755
00:19:42.248 --> 00:19:43.849
they bought at extremely high valuations.

756
00:19:44.330 --> 00:19:44.810
And what happened?

757
00:19:44.930 --> 00:19:46.672
Stock prices lost more than half their value.

758
00:19:47.432 --> 00:19:49.674
And so eventually it's a bit like Paul described,

759
00:19:49.734 --> 00:19:51.195
the valuation of private companies.

760
00:19:51.596 --> 00:19:53.117
Because of those 2020 excesses,

761
00:19:53.537 --> 00:19:56.018
public investors got burned because they still lost more than 50%

762
00:19:56.338 --> 00:19:56.898
of their value.

763
00:19:57.418 --> 00:19:58.599
We tell private investors now,

764
00:19:58.759 --> 00:19:59.319
when you come in,

765
00:19:59.679 --> 00:20:00.080
you're starting,

766
00:20:00.120 --> 00:20:00.340
yes.

767
00:20:00.680 --> 00:20:00.820
Yes,

768
00:20:00.840 --> 00:20:04.321
so all the private valuation rounds have readjusted to this minus 50%.

769
00:20:05.142 --> 00:20:08.783
So even if the private company was adding value with new milestones,

770
00:20:09.264 --> 00:20:11.044
the new investors to fund the cycle would say,

771
00:20:11.725 --> 00:20:11.965
yes,

772
00:20:12.565 --> 00:20:13.225
you're very kind,

773
00:20:13.765 --> 00:20:15.526
but we took a real hit with past excesses.

774
00:20:15.826 --> 00:20:17.607
And so we're going to come in at this level.

775
00:20:18.107 --> 00:20:19.648
So it's this period that's very difficult.

776
00:20:19.808 --> 00:20:24.031
which precisely requires efforts from investors to do what we call down rounds,

777
00:20:24.231 --> 00:20:25.432
which isn't pleasant for anyone,

778
00:20:25.933 --> 00:20:26.994
and it's worse for management,

779
00:20:27.314 --> 00:20:28.795
who are trying to develop the thing,

780
00:20:28.875 --> 00:20:29.496
moving it forward,

781
00:20:29.497 --> 00:20:33.359
and in fact the company's valuation doesn't happen because of these historical problems.

782
00:20:34.059 --> 00:20:35.020
But for a few months now,

783
00:20:35.781 --> 00:20:37.282
we feel the market is starting up again,

784
00:20:37.742 --> 00:20:38.503
the public market,

785
00:20:38.883 --> 00:20:40.084
this year the biotech market,

786
00:20:40.444 --> 00:20:43.767
the XBI index is doing better than it's the first time in a very,

787
00:20:43.807 --> 00:20:44.467
very long time.

788
00:20:45.228 --> 00:20:46.709
we can hope that for private companies,

789
00:20:46.749 --> 00:20:49.691
valuations will start going up again and enter a slightly more virtuous cycle.

790
00:20:50.091 --> 00:20:51.452
And then also thanks to Mark's efforts,

791
00:20:51.572 --> 00:20:51.852
Abbevax,

792
00:20:51.912 --> 00:20:53.553
you have an exceptional valuation currently.

793
00:20:53.733 --> 00:20:55.334
It also acts as a bit of a French spearhead.

794
00:20:55.374 --> 00:20:57.455
It helps put France back on the global biotech map.

795
00:20:57.875 --> 00:20:58.495
And inevitably,

796
00:20:58.515 --> 00:20:58.856
it's true,

797
00:20:58.857 --> 00:20:59.976
when you talk to American funds,

798
00:20:59.977 --> 00:21:01.337
you have these topics that can come up.

799
00:21:01.737 --> 00:21:01.857
Well,

800
00:21:01.897 --> 00:21:02.057
yes,

801
00:21:02.098 --> 00:21:02.898
you French biotechs,

802
00:21:02.918 --> 00:21:04.479
you also manage to do great science,

803
00:21:04.519 --> 00:21:05.159
great technology.

804
00:21:05.960 --> 00:21:06.760
We pulled Abbevax up.

805
00:21:07.100 --> 00:21:08.381
Also with the AMOLED story,

806
00:21:08.461 --> 00:21:10.342
which gave us an interesting international resonance.

807
00:21:10.722 --> 00:21:13.424
I have a lot of hope too that valuations can go back up in our sector.

808
00:21:13.848 --> 00:21:14.248
And what's the,

809
00:21:14.389 --> 00:21:14.749
I don't know,

810
00:21:14.849 --> 00:21:16.410
the lesson to learn so that it doesn't happen again?

811
00:21:17.231 --> 00:21:19.493
It's complicated because these are market effects and so on.

812
00:21:19.753 --> 00:21:20.353
But in any case,

813
00:21:20.393 --> 00:21:21.194
we've still gone through,

814
00:21:21.574 --> 00:21:21.735
well,

815
00:21:21.895 --> 00:21:22.755
a period of excess.

816
00:21:23.176 --> 00:21:23.936
Excess is never good,

817
00:21:23.937 --> 00:21:24.177
you know.

818
00:21:24.517 --> 00:21:26.939
There was a period of excess where we sold a preclinical idea.

819
00:21:26.999 --> 00:21:29.221
We hadn't even treated a monkey.

820
00:21:29.361 --> 00:21:31.082
And we'd say it's going to revolutionize medicine.

821
00:21:31.302 --> 00:21:31.583
And then...

822
00:21:32.063 --> 00:21:32.563
What's the problem?

823
00:21:32.583 --> 00:21:34.405
Is it that people want to buy it or people are selling it?

824
00:21:34.605 --> 00:21:34.725
No,

825
00:21:34.765 --> 00:21:35.206
but it's true.

826
00:21:35.226 --> 00:21:35.346
No,

827
00:21:35.366 --> 00:21:35.766
but it's no,

828
00:21:35.786 --> 00:21:36.447
but there are people.

829
00:21:37.027 --> 00:21:38.368
And that's true in the United States,

830
00:21:38.388 --> 00:21:38.989
maybe even more,

831
00:21:39.009 --> 00:21:40.350
who sell wonderful stories,

832
00:21:40.370 --> 00:21:41.431
who know how to do that.

833
00:21:41.811 --> 00:21:41.971
And,

834
00:21:41.972 --> 00:21:42.191
you know,

835
00:21:42.231 --> 00:21:43.032
some investors do get...

836
00:21:43.468 --> 00:21:43.588
Well,

837
00:21:43.608 --> 00:21:45.429
they can get caught up a bit in this sales pitch,

838
00:21:45.569 --> 00:21:45.889
let's say.

839
00:21:46.289 --> 00:21:48.070
The factory means that it's a fantastic sector.

840
00:21:48.370 --> 00:21:48.930
Value creation,

841
00:21:48.931 --> 00:21:49.311
we see it,

842
00:21:49.312 --> 00:21:49.711
for example,

843
00:21:49.712 --> 00:21:50.131
with Abivax,

844
00:21:50.211 --> 00:21:50.991
but with other companies,

845
00:21:51.291 --> 00:21:51.672
it can be,

846
00:21:52.212 --> 00:21:52.352
well,

847
00:21:52.512 --> 00:21:53.172
it can be massive.

848
00:21:53.472 --> 00:21:55.773
If you really develop a great technology that has,

849
00:21:56.254 --> 00:22:00.756
that's going to help patients survive or feel better and have a better quality of life,

850
00:22:01.176 --> 00:22:01.316
well,

851
00:22:01.416 --> 00:22:02.036
there will always,

852
00:22:02.336 --> 00:22:03.417
it will always be rewarded.

853
00:22:03.517 --> 00:22:04.797
The only thing is that the pathway,

854
00:22:04.857 --> 00:22:05.438
in the meantime,

855
00:22:05.458 --> 00:22:05.798
it's a bit,

856
00:22:06.098 --> 00:22:07.339
a bit winding and a bit chaotic.

857
00:22:07.399 --> 00:22:07.719
That's it.

858
00:22:08.019 --> 00:22:08.139
Yeah.

859
00:22:08.439 --> 00:22:09.359
And that's how you lose your hair,

860
00:22:09.379 --> 00:22:09.680
you see.

861
00:22:10.000 --> 00:22:10.120
No,

862
00:22:10.160 --> 00:22:10.460
but it's.

863
00:22:10.620 --> 00:22:11.000
And actually,

864
00:22:11.541 --> 00:22:12.401
you have to stay the course,

865
00:22:12.461 --> 00:22:14.062
because it's true that over these last two years,

866
00:22:14.242 --> 00:22:15.443
it's been extremely complicated.

867
00:22:15.743 --> 00:22:17.884
And those who were able to keep their heads above water,

868
00:22:17.964 --> 00:22:18.105
well,

869
00:22:18.145 --> 00:22:18.325
now,

870
00:22:18.385 --> 00:22:18.725
finally,

871
00:22:18.905 --> 00:22:19.906
it's filtered out a bit.

872
00:22:19.966 --> 00:22:20.206
You know,

873
00:22:20.266 --> 00:22:25.169
what was happening between what was great tech didn't have much of a fundamental basis behind it to allow it to be applied.

874
00:22:25.409 --> 00:22:30.192
And I think that now we're reaching a point where precisely those who managed to keep their heads above water by various means,

875
00:22:30.652 --> 00:22:33.754
they're going to come out stronger because they'll be a bit more alone on the market in the end.

876
00:22:34.094 --> 00:22:35.655
And there is indeed capital present again,

877
00:22:35.695 --> 00:22:36.956
so there's also a need to invest.

878
00:22:37.156 --> 00:22:40.599
From what you're both saying is that there are still actually some ongoing challenges,

879
00:22:41.340 --> 00:22:42.921
but it also allows for progress too.

880
00:22:43.222 --> 00:22:46.184
It's that it also allows everyone to become more professional and to explain that,

881
00:22:46.284 --> 00:22:46.625
in fact,

882
00:22:46.626 --> 00:22:49.407
you can't like just show up believing only in your science,

883
00:22:49.427 --> 00:22:51.369
or maybe that's the lesson,

884
00:22:51.409 --> 00:22:51.749
I don't know,

885
00:22:51.930 --> 00:22:52.690
regarding funding.

886
00:22:52.830 --> 00:22:53.011
Yes,

887
00:22:53.031 --> 00:22:54.192
what doesn't kill you makes you stronger.

888
00:22:54.472 --> 00:22:55.213
As long as you're alive,

889
00:22:55.233 --> 00:22:55.713
you have hope.

890
00:22:55.953 --> 00:22:57.194
And we're getting stronger and stronger,

891
00:22:57.195 --> 00:22:57.435
you know.

892
00:22:57.655 --> 00:22:59.957
It forces you to always have this awareness of trade-offs.

893
00:23:00.217 --> 00:23:03.200
So it's true that I think when you do Series A rounds of over 150 million.

894
00:23:03.460 --> 00:23:03.840
You can say,

895
00:23:03.860 --> 00:23:03.980
well,

896
00:23:04.000 --> 00:23:04.660
I have my platform,

897
00:23:04.720 --> 00:23:05.721
I've invested a bit everywhere,

898
00:23:05.722 --> 00:23:06.581
and then we'll see how it goes.

899
00:23:06.601 --> 00:23:06.721
Well,

900
00:23:06.722 --> 00:23:06.821
no,

901
00:23:06.822 --> 00:23:07.381
you can't do that.

902
00:23:07.501 --> 00:23:07.621
Yeah,

903
00:23:07.721 --> 00:23:08.181
being selective,

904
00:23:08.241 --> 00:23:08.421
right?

905
00:23:08.721 --> 00:23:09.482
Extremely selective.

906
00:23:09.742 --> 00:23:10.222
And focused.

907
00:23:10.502 --> 00:23:10.622
Well,

908
00:23:10.642 --> 00:23:13.903
that's what we see in any case that gave Abivax the chance to be ultra-focused.

909
00:23:14.303 --> 00:23:16.223
Are these things to keep in mind and to think about?

910
00:23:16.824 --> 00:23:17.684
I believe in it a lot.

911
00:23:18.124 --> 00:23:18.924
I learned that at Amgen.

912
00:23:19.284 --> 00:23:19.924
We were up against,

913
00:23:20.265 --> 00:23:21.265
we had Johnson & Johnson,

914
00:23:21.365 --> 00:23:21.625
Roche,

915
00:23:21.665 --> 00:23:22.085
and so on.

916
00:23:22.585 --> 00:23:22.985
Against us,

917
00:23:23.025 --> 00:23:24.126
they're fantastic companies.

918
00:23:25.226 --> 00:23:26.806
And we realized that when you're well-focused,

919
00:23:26.846 --> 00:23:28.127
when you're really close to the doctors,

920
00:23:28.187 --> 00:23:29.267
when you develop good science,

921
00:23:29.507 --> 00:23:30.227
when you only do that,

922
00:23:30.507 --> 00:23:31.287
you're better than the others,

923
00:23:31.307 --> 00:23:33.088
because simply they do lots of things at the same time.

924
00:23:33.588 --> 00:23:35.189
and days only have 24 hours.

925
00:23:35.629 --> 00:23:37.470
And so if you spend more time than the others,

926
00:23:37.510 --> 00:23:38.811
besides if you listen to Elon Musk,

927
00:23:38.831 --> 00:23:39.571
that's what he says too.

928
00:23:40.091 --> 00:23:40.532
What he says,

929
00:23:40.772 --> 00:23:43.693
a big part of his success is while they work six hours,

930
00:23:44.133 --> 00:23:47.395
I work 12 hours because I work on the same thing and we do better than the others.

931
00:23:47.735 --> 00:23:47.855
So

932
00:23:48.335 --> 00:23:49.476
I really do think that focus,

933
00:23:49.856 --> 00:23:50.096
you know,

934
00:23:50.097 --> 00:23:51.497
it still has some truly great virtues.

935
00:23:51.797 --> 00:23:52.678
I think Mark said it all.

936
00:23:52.798 --> 00:23:53.558
We don't have a choice.

937
00:23:54.078 --> 00:23:54.478
But for you,

938
00:23:54.539 --> 00:23:56.319
having both a drug candidate and a platform,

939
00:23:56.320 --> 00:23:57.300
is that also two things?

940
00:23:57.792 --> 00:23:58.292
Absolutely.

941
00:23:58.392 --> 00:24:00.613
It's deciding when to develop our lead asset to the max,

942
00:24:00.733 --> 00:24:01.553
because on the lead asset,

943
00:24:01.554 --> 00:24:02.954
you can also do indication extensions.

944
00:24:02.955 --> 00:24:04.574
We have a lot of potential on the first asset.

945
00:24:05.034 --> 00:24:06.355
And then afterwards,

946
00:24:06.356 --> 00:24:10.296
you also have to be able to show that you can replicate the success or pivot if needed with your platform.

947
00:24:10.996 --> 00:24:15.217
So you also have to find the right balance in how far to advance your other platform assets to at least,

948
00:24:15.477 --> 00:24:16.117
and in my view,

949
00:24:16.437 --> 00:24:17.298
show proof of concept,

950
00:24:17.358 --> 00:24:20.038
even if it's just at the pilot stage that your platform is really there.

951
00:24:20.479 --> 00:24:22.399
It exists and it will support what's next.

952
00:24:22.799 --> 00:24:23.840
We were still talking about money,

953
00:24:23.920 --> 00:24:25.020
which is in limited supply.

954
00:24:25.492 --> 00:24:27.473
How do you have ambition and at the same time stay frugal?

955
00:24:27.913 --> 00:24:28.533
Are there choices,

956
00:24:28.593 --> 00:24:30.314
mistakes and choices in resource allocation?

957
00:24:30.594 --> 00:24:31.394
Or where you say to yourself,

958
00:24:31.474 --> 00:24:31.714
actually,

959
00:24:31.734 --> 00:24:32.414
I didn't do it well?

960
00:24:32.895 --> 00:24:34.575
Resource allocation is one of the big topics,

961
00:24:34.755 --> 00:24:35.055
I think,

962
00:24:35.095 --> 00:24:36.036
especially for the CEO,

963
00:24:36.116 --> 00:24:36.756
the general manager.

964
00:24:37.196 --> 00:24:40.057
Because it's true that the temptation is always to do quite a few things.

965
00:24:40.337 --> 00:24:41.297
There are always new projects,

966
00:24:41.357 --> 00:24:41.858
new ideas.

967
00:24:42.638 --> 00:24:45.219
And so you have to be extremely disciplined about resource allocation.

968
00:24:45.659 --> 00:24:46.999
Then regarding the means themselves,

969
00:24:47.119 --> 00:24:47.259
well,

970
00:24:47.680 --> 00:24:48.640
people travel in economy.

971
00:24:49.296 --> 00:24:52.639
It's for sure that when you come from big pharma and you join a small company,

972
00:24:52.679 --> 00:24:53.219
for example,

973
00:24:53.600 --> 00:24:56.182
it's quite a shock because the number of people working for you,

974
00:24:56.662 --> 00:24:57.403
you do things yourself,

975
00:24:57.443 --> 00:24:58.303
you book your own flights,

976
00:24:58.304 --> 00:24:59.064
you do your own stuff.

977
00:24:59.725 --> 00:25:00.025
But well,

978
00:25:00.085 --> 00:25:01.266
sometimes it takes awareness.

979
00:25:01.746 --> 00:25:02.227
Money matters.

980
00:25:02.747 --> 00:25:05.469
It's not meant to be spent in nice hotels and things like that.

981
00:25:05.890 --> 00:25:08.792
I can tell you last year when we were at JP Morgan with Abivax,

982
00:25:08.832 --> 00:25:10.413
I can tell you that the hotel we stayed in,

983
00:25:10.673 --> 00:25:10.794
well,

984
00:25:11.574 --> 00:25:12.335
it was quite something.

985
00:25:12.735 --> 00:25:13.796
And it was still very expensive.

986
00:25:14.056 --> 00:25:14.917
I don't remember exactly.

987
00:25:14.957 --> 00:25:16.558
It was still $450 a night.

988
00:25:16.858 --> 00:25:18.480
But we could have gone to $1,000 hotels,

989
00:25:18.520 --> 00:25:18.680
which...

990
00:25:18.900 --> 00:25:20.101
wouldn't have been much better actually.

991
00:25:20.861 --> 00:25:21.401
But there you go.

992
00:25:21.961 --> 00:25:24.262
You have to be careful because it's not our money.

993
00:25:24.502 --> 00:25:25.203
It's the shareholders'

994
00:25:25.223 --> 00:25:27.364
money and it's for developing my drugs.

995
00:25:27.365 --> 00:25:28.164
So you have to be careful,

996
00:25:28.184 --> 00:25:28.904
but stay focused.

997
00:25:29.325 --> 00:25:30.265
Now I say this all the time.

998
00:25:30.725 --> 00:25:36.768
You have to spend your money on things that really make a difference and the things that don't make a...

999
00:25:37.148 --> 00:25:37.648
So for me,

1000
00:25:37.688 --> 00:25:38.849
that's the number one criterion.

1001
00:25:38.989 --> 00:25:40.349
Is this going to do something for the patient?

1002
00:25:40.350 --> 00:25:41.870
Is it going to change the company's trajectory?

1003
00:25:43.511 --> 00:25:43.791
If so,

1004
00:25:43.931 --> 00:25:44.251
then yes,

1005
00:25:44.252 --> 00:25:44.931
you have to go all in.

1006
00:25:45.532 --> 00:25:45.812
Otherwise,

1007
00:25:45.852 --> 00:25:46.072
rest.

1008
00:25:46.356 --> 00:25:47.416
Then the other difference is that,

1009
00:25:47.536 --> 00:25:47.676
well,

1010
00:25:47.696 --> 00:25:48.517
if you don't have a budget,

1011
00:25:48.537 --> 00:25:49.377
you don't get paid either.

1012
00:25:49.977 --> 00:25:50.597
So there's that too.

1013
00:25:50.598 --> 00:25:54.278
So you're forced to prioritize everything you're going to do and you can't hide either.

1014
00:25:54.838 --> 00:25:56.259
Meaning all the choices you make are,

1015
00:25:56.279 --> 00:25:56.639
of course,

1016
00:25:56.679 --> 00:25:57.479
discussed with the board,

1017
00:25:57.519 --> 00:25:58.499
discussed with your colleagues.

1018
00:25:59.200 --> 00:26:03.401
But it's you as CEO who makes those final choices and who must bear the responsibility for them.

1019
00:26:03.661 --> 00:26:04.601
So it also involves,

1020
00:26:04.721 --> 00:26:05.021
I'd say,

1021
00:26:05.381 --> 00:26:06.422
everything you do.

1022
00:26:06.502 --> 00:26:06.642
Yeah,

1023
00:26:06.662 --> 00:26:07.542
the future of the company.

1024
00:26:08.182 --> 00:26:10.003
Cost control is about being able to adapt as well.

1025
00:26:11.263 --> 00:26:13.023
To bring big pharma experience to a biotech,

1026
00:26:13.024 --> 00:26:14.624
you also have to learn.

1027
00:26:15.148 --> 00:26:15.268
Oh,

1028
00:26:15.288 --> 00:26:15.448
yes.

1029
00:26:15.528 --> 00:26:16.669
But that's the charm of what we do.

1030
00:26:17.230 --> 00:26:18.210
That's what's great about our jobs.

1031
00:26:18.751 --> 00:26:19.631
We're learning all the time.

1032
00:26:20.612 --> 00:26:21.292
Every day is different.

1033
00:26:21.532 --> 00:26:21.713
Yeah.

1034
00:26:22.193 --> 00:26:22.693
And above all,

1035
00:26:22.733 --> 00:26:27.136
it's this drug that you see in patients and that's going to change their lives.

1036
00:26:27.156 --> 00:26:28.117
It's truly extraordinary.

1037
00:26:28.597 --> 00:26:29.058
Thank you both.

1038
00:26:29.298 --> 00:26:32.460
We've had two visions of life and company journeys.

1039
00:26:32.840 --> 00:26:33.121
Thank you.

1040
00:26:33.521 --> 00:26:35.022
If any listeners have questions for you,

1041
00:26:35.082 --> 00:26:36.083
who wants to offer their help?

1042
00:26:36.423 --> 00:26:37.083
No problem at all.

1043
00:26:37.183 --> 00:26:37.664
On LinkedIn,

1044
00:26:37.744 --> 00:26:38.164
it's fine.

1045
00:26:38.584 --> 00:26:38.885
Thank you.

1046
00:26:39.485 --> 00:26:39.845
And thank you,

1047
00:26:39.846 --> 00:26:40.085
Natalie.

1048
00:26:40.406 --> 00:26:41.046
Thank you very much.

1049
00:26:41.366 --> 00:26:43.748
The learning from this episode comes down to three formulas.

1050
00:26:44.072 --> 00:26:44.232
Well,

1051
00:26:44.332 --> 00:26:44.612
first,

1052
00:26:44.613 --> 00:26:45.813
you don't die from dilution.

1053
00:26:46.834 --> 00:26:48.175
You die if you don't have cash.

1054
00:26:48.395 --> 00:26:49.896
I think that's the strongest formula.

1055
00:26:50.076 --> 00:26:51.778
But we also understand that 70%

1056
00:26:52.158 --> 00:26:54.500
of deals don't happen because of manufacturing.

1057
00:26:54.700 --> 00:26:56.581
And also that you don't sell yourself.

1058
00:26:56.821 --> 00:26:57.642
You get bought out.

1059
00:26:57.862 --> 00:26:59.543
We understand that making choices,

1060
00:26:59.723 --> 00:27:00.184
owning them,

1061
00:27:00.264 --> 00:27:01.104
knowing when to raise,

1062
00:27:01.144 --> 00:27:03.586
not losing sight of what really creates value.

1063
00:27:04.006 --> 00:27:05.588
That's what comes out of this discussion.

1064
00:27:06.468 --> 00:27:09.731
In the next episode and final episode of this series on execution,

1065
00:27:09.891 --> 00:27:11.432
we're changing gears completely.

1066
00:27:11.900 --> 00:27:13.561
I'm taking you away from structures,

1067
00:27:13.661 --> 00:27:17.904
financing systems to go towards something much harder to measure and much more essential.

1068
00:27:18.785 --> 00:27:20.306
That moment when execution,

1069
00:27:20.326 --> 00:27:20.706
in fact,

1070
00:27:20.746 --> 00:27:22.207
simply becomes a personal act.

1071
00:27:22.447 --> 00:27:27.671
Patrice Zagamin talks to us about commitment or more simply about what we're really ready to put on the line.