Johnson & Johnson: Johan Verbeeck. Accelerating Innovation across the Healthcare Landscape




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Video title: Johnson & Johnson: Johan Verbeeck. Accelerating Innovation across the Healthcare Landscape
Released on: March 27, 2013. © PharmaTelevision Ltd
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Johan Verbeeck, Senior Director of Partnership Management at J & J Innovation discusses the Johnson & Johnson Innovation Centers. The four centers based in Boston, California, London & Shanghai aim to facilitate J & J's exchange of ideas with local innovators and provide the resources necessary to bring deals forward on a local basis.
An overview about role of Johnson & Johnson's Innovation Centers
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here at BioEurope Spring, in Barcelona, in 2013. On this show I have Johan Verbeeck, who is at Johnson & Johnson Innovation Center based in London, welcome.
Johan Verbeeck:
Thank you and thanks for having me.
Fintan Walton:
A pleasure, Johnson & Johnson just announced back in September of last year this concept of Innovation Centers, and this is a new initiative by Johnson & Johnson to get access to innovation, no doubt, you are based in the, one of the centers and that center is in London as I have just mentioned, so Johan as somebody who has joined this new initiative describe to our audience what this initiative is all about and what Johnson & Johnson are trying to do by setting these centers up?
Johan Verbeeck:
Okay, well as you mentioned we have several centers, there is actually four which will start up in rapid succession, London will be officially announced this week, there is also a center that is starting up in San Francisco, Boston and later in the year in Shanghai. The Innovation Centers aim to bring together experts from Johnson & Johnson across the three sectors, not only pharma, but also consumer, medical device and diagnostics, as you are aware J&J has these three big branches, the Innovation Centers will serve each and everyone of those. The idea is that we're going to create a facility, a hub where we surround some of our best scientists with an infrastructure to come to fast and no nonsense deal making with entrepreneurs, innovators, VCs out there. These four locations were picked because they are obviously biotech hotspots in the world today, we may well end up starting more Innovation Centers in the future, but we are starting at these four locations.
Fintan Walton:
Okay, now gaining access to innovation is a challenge as you recognize through the setting up this Innovation Center you're going to have to have the right talent base presumably in this Innovation Center and I suppose one of the things that may cross somebody's mind is when you talk about scientists is this going to be a laboratory based innovation centre or are they scientists purely focused on looking at innovation outside Johnson & Johnson?
Johan Verbeeck:
We are not like laboratory based and it will not do any wet labs in London or any of these cities that I just mentioned, we do have scientists on board and without the exception these are very experienced scientists from within J&J, or the scientists that we attracted from outside that represent the five therapeutic areas in which Johnson & Johnson is active, neuroscience, oncology, cardiovascular, metabolism, immunology, and infectious diseases, but also the areas for consumer, and medical device, and diagnostics, so these are very experienced people. Now we surround these with deal makers, BD people, legal, finance, to come to a very rapid way of executing partnerships, deals what have you to further innovation in these centers.
Fintan Walton:
Right, so there they act as scouts in a sense?
Johan Verbeeck:
They act as scouts, they build a network, so building a network is obviously crucial and that is one of the main aims of the innovation centers. We want to be where the entrepreneurs are, where academia is, that is in these spots that we just mentioned. We think that having a local presence on the ground there will facilitate setting up these relationships and networks, we are in this for the long-term, this is not a on/off one day initiative, we want to establish strong personal relationships with scientists and innovators out there and we think it is best to sit in these regions. I do think that this is happening at an unprecedented scale, you can see from what we are doing, having quite large teams on the ground in these centers, we showing, J&J showing a lot of commitment to innovation and the science, of course with one goal and that is to advance healthcare and to succeed in finding therapies for the disease area strongholds that we are in.
Governance of deal making and its financial sources
Fintan Walton:
Okay, and when you talk about numbers, I mean obviously you are still putting these centers together, what sort of size do you see these?
Johan Verbeeck:
This will probably be about 20 people each, so worldwide I think we are talking about 80 people.
Fintan Walton:
Okay, and of course you talked about speed to do deals, obviously a part of, an important ingredient in that of course is the decision making, at what level are decisions are being made, are they made at the innovation center level or how is that done?
Johan Verbeeck:
They are made both at the level of the innovation center and the therapeutic areas in Johnson & Johnson or at the consumer end in the shops that we have in the mother company. Governance is needed, a governance structure has been built around that to facilitate decision making, but the decision making is done on both ends, that is why it is so important that we have scientists and people in the innovation centre that have a strong link to the company, we cannot alienate ourself from Johnson & Johnson while at the same time we connect with the entrepreneurs out there.
Fintan Walton:
Right, that's quite a always a challenge for large corporations to do, now the other thing that helps decision making is budgets, so where does it find, how do you fund the types of deals you do, they come from within, have the each of the innovation centers got their own budgets to spend, do they draw their funds from elsewhere within Johnson & Johnson and does that extend all the way into some of the VC funds that Johnson & Johnson has been acting as an LP?
Johan Verbeeck:
There is different funds available in the company that's called JJDC and Johnson & Johnson Development Corporation, our internal VC arm. There is money allocated within the therapeutic areas to support deal making in the ICs, and the IC itself has a budget and obviously we will continue collaborating with the venture funds that we are active in London and also in other locations in the world, so funding comes from different areas. I think we can say today and when you look at the commitment that we are showing now in setting up these innovation centers obviously we are going to fund it, it would make no sense to set up these centers, invest in it and then do not have the funds to execute these deals. When we see good science and good innovation that can further development of therapies for some of the diseases that are we are after and which are pretty devastating diseases today, lets name Alzheimer's or small cell lung cancer as an example, we will find a budget for that internally, there is strong commitment to that.
Fintan Walton:
Right, but you have these various sources of funds to bring it, because obviously deal making is more a little bit more complex, some deals will require an equity component some may not?
Johan Verbeeck:
Absolutely and there will be a lot of the flexibility in the kind of deals that we will make, there is different options that we can do, and I would it's not only about equity, if you look at Johnson & Johnson we are a corporation, very wide corporation of course, we have 250 operating companies worldwide, which by the way is one of the advantages to that there is an advantage in setting up these innovation centers, it helps entrepreneurs to tap into Johnson & Johnson in a much easier way, we are now their partner on the ground so to speak, the outreach is it's more than equity, we are a large corporation, we have a lot of internal assets and capabilities, we are also planning to make some of these assets, experienced science available to partners we work with. It's basically teaming up in a relationship to further this science that they are working on and that can be more than dollars, there are the internal capabilities that we want to leverage, right now we are setting us up internally to do this in a very seamless manner and we will execute that in the future.
Coordination between innovation centers
Fintan Walton:
So these four innovation centers are spun across the globe in that way, presumably there is some, also some coordination between those innovation centers themselves, and where to they report into, they must report into one part of the organization?
Johan Verbeeck:
The innovation centers they are linked of course and we try to pursue the same strategy, there may be regional differences because every hot, biotech hotspot is different on itself, but the global, the global of the overall way of operating is identical between the centers. They report into the Chief Scientific Officer who is Paul Stoffels for Johnson & Johnson, he is the CSO across the three sectors in J&J, so this also helps us to execute deals that span more than pharma, this is not just only about pharma, it's about the two other sectors, it all comes together in the person of Dr. Paul Stoffels who oversees science in the three sectors today.
Fintan Walton:
Okay, now the other element to this of course, we talked about you've been based in London, but I understand it's more than London, this is your interest is beyond that obviously you may even get on the Eurostar and go across to places like France and Belgium even?
Johan Verbeeck:
Or Barcelona.
Fintan Walton:
Even to Barcelona, so what is your, what is the extent of your interest in Europe?
Johan Verbeeck:
London basically serves the whole of Europe including Russia that is the intent, we are not only limiting ourselves to United Kingdom, obviously we have to pick one spot to be, London is a biotech hotspot, together with other regions in the Europe we do recognize that and it is our intent to work with them. London has some advantages in the fact that we are close to Heathrow, it's a very easily link to North America to the mother company, as you said the Eurostar it's easy to get every where in Europe, it's a great location to be in and it's a great location to work together with the rest of Europe.
Innovation Centers area of interest and future plans
Fintan Walton:
So just finally Johan, in terms of the vision that Johnson & Johnson has for these ICs these innovation centers, you must have a plan where you want to be in about five-years time, so what sort of impact would you like to have seen within five-years?
Johan Verbeeck:
Our vision is to accessing science and accessing innovation, to capitalize that science and innovation to the innovation centers and tackle some of the diseases that we are after. If you were to ask me how many deals that you want to make, I am not going to give you an answer because we don't have that number on paper, but we would say that's almost irrelevant, we are after looking for the best science, the best innovation out there that can further our hunt for therapies for the diseases that we are working, that is the goal of the innovation center. We must also make very clear that the innovation centers work in the early space, preclinical proof of concept, we are not going to be active in late stage licensing and acquisitions, there is a classical BD groups in Johnson & Johnson who have done a perfect job in that in the past few years and we will continue to do that. The innovation centers are about the accessing early science, from discovery all the way to preclinical proof of concept, that is the goal, that is our vision that's what we are after.
Fintan Walton:
Johan, thank you very much indeed for coming on the show.
Johan Verbeeck:
Thank you, and please come see us in London, we are open for business as of this week and I hope to greet you there.
Fintan Walton:
Thank you very much indeed.
Johan Verbeeck:
Thank you.
Fintan Walton
Dr Fintan Walton is the Founder and CEO of PharmaVentures . After completing his doctoral research on the genetics of cell proliferation at the University of Michigan(US)and Trinity College (Dublin, Ireland), Dr Walton gained broad commercial experience in biotechnology in management positions at Bass and Celltech plc (1982-1992).
Johan Verbeeck
Senior Director, Partnership Management
At the time of this PTV interview Johan Verbeeck serves as Senior Director, Partnership Management at Johnson & Johnson Innovation Center based in London.
PharmaVentures
PharmaVentures is a corporate finance and transactions advisory firm that has served hundreds of clients worldwide in relation to their strategic deal making in the pharmaceutical, life science and healthcare sectors. Our key offerings include: Transactions / deal negotiations; Product / technology valuations; Deal term advice; Due diligence & expert reports; Strategy formulation; Alliance management; and Expert opinion for litigation/arbitration cases. PharmaVentures provides the global expertise to ensure our clients generate the highest possible return on investment from all their deal making activities. We have experience of all therapeutic areas and can offer advice on both product and technology commercialization.
Johnson & Johnson Innovation Center
The London innovation centre is part of Johnson & Johnson Innovation, a division of Johnson & Johnson Finance Corporation, Ltd. Johnson & Johnson Innovation focuses on accelerating early innovation and enhancing opportunities for collaboration and investment across Johnson & Johnson's global healthcare businesses. Johnson & Johnson Innovation provides scientists, entrepreneurs and emerging companies focused on early-stage opportunities a one-stop access to science and technology experts who can facilitate collaborations across the pharmaceutical, medical device and diagnostics and consumer companies of Johnson & Johnson. Johnson & Johnson Innovation includes local deal-making capabilities with the flexibility to adapt deal structures to match early-stage opportunities and establish novel collaborations that speed development of those innovations to solve unmet needs in patients.