The CEO of 2019's biggest biotech IPO told us how he's upending the 'same old corporate approach' in healthcare with a stripped down and cost-conscious model
- BridgeBio just debuted on the stock market with a market value of $3.3 billion. It's the biggest biotech IPO of the year so far.
- BridgeBio was founded with a cost-conscious ethos, because the "same old corporate approach" in biopharma wouldn't meet the needs of BridgeBio's rare disease-focused model, CEO and founder Neil Kumar said.
- Kumar spoke with Business Insider at the Nasdaq stock exchange building in New York City's Times Square the day BridgeBio went public, and broke down for us what makes BridgeBio's model so different.
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The biotech BridgeBio just made its stock market debut, marking the biggest biotech IPO of the year so far, according to Renaissance Capital's IPO Pro data platform.
Shares of the genetic disease-focused company surged 62% in Thursday trading, giving the company a market value of $3.3 billion. BridgeBio raised $348.5 million, topping Adaptive Biotechnologies' $300 million IPO and Gossamer Bio's $276 million offering earlier this year.
So it may come as a surprise to learn, in spite of the big numbers, cost-consciousness is at the very heart of BridgeBio's ethos and structure.
The Palo Alto, California-based biotech focuses on drugs for rare diseases, with extremely small patient populations, so that "same old corporate approach" from biopharmaceutical companies with a big and costly infrastructure just wouldn't work, CEO Neil Kumar told Business Insider on Thursday.
BridgeBio "didn't see anyone else doing it, so we're doing it that way," Kumar explained in an interview at the Nasdaq stock exchange headquarters in New York City's Times Square.
A Stanford and MIT-trained engineer, Kumar went on to work for McKinsey, MyoKardia, and the biotech-focused venture-capital firm Third Rock Ventures before founding BridgeBio in 2015.
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BridgeBio's strategy was inspired by a trend Kumar observed around the time he was working at McKinsey and then venture capital: companies were using innovative science, trying to make better medicines than already existed, but weren't changing up their corporate model to keep pace.
That was "sort of antithetical to the way that startups work in other spaces," like tech, he said.
BridgeBio's stripped down approach to tackling rare diseases
The old approaches might have worked for diseases that affect many people, like diabetes, which 30 million Americans had in 2015, for instance, but "because of that cost infrastructure, you could never get anyone excited to go after 1,000 or 500-patient communities," Kumar said. "But the science was there," thanks to major advances like the sequencing of the human genome.
BridgeBio's model takes a stripped-down approach to doing things, including using "minimum viable teams" on projects, of just six to eight scientists. Teams for research studies are no bigger than 30, Kumar said, "which is very, very small."
That made it possible to take two of its drug programs from academic work at Stanford to early research for under $30 million each, when "an order of magnitude greater" would be expected, and all in the matter of a few years, Kumar said.
The biotech also centralizes resources that can be applied to multiple different projects, like its team of chemists, so if someone has an idea about a disease state, "they can immediately get into lab space and start the project, Day One," Kumar explained. When the project is finished, the chemists get returned, so to speak.
The goal behind this structure is to get the company focused on each individual area it works in, while also using shared, centralized assets, making things faster and more cost-effective. That translates to having a very minimal footprint, and "always trying to save," Kumar explained.
Still, research gets very expensive, and "running a phase 3 is still running a phase 3... So the purpose of an IPO is to say, we want to raise additional capital so we can put our heads down and carry out the science," he said.
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