Curiosity and Innovation

Melinda Richter, JLABS on how helping to empower genius will liberate science and improve patient outcomes.

When Melinda Richter, Head of Johnson & Johnson Innovation (JLABS), was a child she would never accept that something was so, simply because her mother said it was. “I was so curious all the time,” she recalls.

When her mother, in frustration, asked why she could not just be satisfied with the ‘because I say so’ answer, little Melinda had an answer of her own. “I would put my hands on my hips and say: ‘Because I’m unique’,” she recalls. This confidence has served her well during a stellar career.

Collaborative approach

She attributes much of the reason for her collaborative approach to her formative years: with five brothers and three sisters, there was never a shortage of opinion on which to draw. “I loved to problem-solve,” she continues. “I loved tapping into each one of them for what they were good at. I’d never thought about it before, but it’s not surprising that I do what I do now. I haven’t changed: well, I’ve got older and wiser and more realistic – but I’m essentially just the same.”

Engaged with the world, interested in solutions and not short of self-belief, Richter has found a natural home at JLABS, whose tagline is ‘Empowering and enabling science to reach the people who need it’.

Energizing R&D

Set up in a bid to energize J&J’s own R&D efforts, JLABS specializes in encouraging clever people to ask ‘why?’ and then supporting them to work out the ‘how’. The idea is that JLABS offers infrastructure, services, education and networking opportunities to early-stage companies in biopharma, medical devices, consumer health and digital who have products to develop but need infrastructure for doing so.

Richter explains, “Early-stage innovation outside the walls of a big company can face specific challenges. We want to break down those hurdles so the science and technology has a great shot of working.”

How can we create something transformative? Something that might even change the world?”

Primarily, J&J hopes to help solve some of the key problems for start-up companies by allowing them to leverage resources that a big outfit would naturally enjoy. “The activation energy required and the risks involved are so high for start-ups that most people would say: ‘It’s too much’,” Richter says. “So we need to bring that down. If we do that, we can find what it is possible for people to do. Our goal is to empower genius and to liberate science everywhere. If we can do that to scale, then we have the potential to transform healthcare.”

Breathing easier

The approach involves giving start-ups easy access to millions of dollars’ worth of hardware and laboratory space to let them breathe a little more easily and concentrate on what they are good at – innovating. The amount the start-ups pay depends on their footprint and on the services they use. At present, there are around 100 companies involved, in four locations: one in San Diego, two in the San Francisco area and one in Boston. Next year, two more locations will be activated in Houston and Toronto.

J&J is clearly looking to foster innovation wherever it can. Of course, the obvious advantage of JLABS that J&J gets in on the ground floor with smart, adventurous small companies which may provide tomorrow’s next great medical breakthrough – but Richter insists that there are no strings attached to J&J’s involvement. Start-ups are not tied into any agreement. J&J might decide to fund a three-month, $100,000 proof-of-concept program, for example, on the basis that this may lead to something more. “We hope we will end up doing a deal together, but companies go through different evolutionary processes,” she says. “A deal will happen when and if it’s right for both parties.”

Radical change

While her motivators in business can be largely traced back to her childhood self - “I’m a very creative and curious person who loves a challenge; I value empowering others; how can I bring on board people who can make this happen?” - there is one big element missing. Richter’s own ‘road to Damascus’ moment came in adulthood after a life-threatening medical emergency: she was bitten by a bug in Beijing and developed an undiagnosed condition which doctors thought might kill her. She survived after months of care, but something had altered in her. At that time, she was with telecoms giant Nortel Networks but made a radical change in her modus operandi after deciding that she had a mission to make a difference. “How can we create something transformative?” she asks. “Something that might even change the world?”

In 2004, she founded Prescience International, which was dedicated to easing the path for entrepreneurs in healthcare – and, in so doing, accelerating research to the patient. J&J saw the potential of Prescience and hired them to help launch and operate their first operational model of JLABS.

Science endeavour

With an MBA from INSEAD in Paris, and a history of raising capital and doing deals, there is no doubting Richter’s business credentials – but in a science-based endeavor, she is not a scientist. This has its advantages, she insists. “I am fascinated by science and technology,” she explains. “I admire those people who are experts in their field – but what helps me to make an impact is that I am not tied to tradition. As a result, I see patterns, trends and frameworks from a different vantage point. Then I look at these from several perspectives: sustainability, the financial model, the people.”

JLABS sounds like a great idea, but patient outcomes are not improved by theory alone. Richter insists that, although it is relatively early days, there are already concrete examples of how the innovation model might help patients. She highlights Arcturus Therapeutics, based in San Diego, which is on track to become an industry leader in RNAi technologies for the treatment of Hepatitis B and rare orphan diseases following its residency at JLABS.

Passion and ideas

Arcturus was founded in 2013 by two men who had learned about JLABS and were inspired to strike out on their own. “They quit their day jobs with a biotech corporation and, with just $40,000, applied to JLABS,” Richter enthuses. “They were not proven entrepreneurs, but they were bright and passionate young men who wanted to make a difference. We set them up for coaching and offered them a no-strings research collaboration.”

Along with some good research data came more venture capital and the start-up, based at JLABS’ San Diego facility, has gone from strength to strength. In January this year, it announced a deal with Precision NanoSystems to manufacture RNA medicines, while in June it entered a worldwide license agreement - facilitated by J&J Innovation - with Janssen Pharmaceuticals to develop and commercialize RNA-based drug products for the treatment of specified diseases using Arcturus’ UNA Oligomer chemistry and LUNAR nanoparticle delivery platform. In October, it made a similar deal with biopharma firm Ultragenyx Pharmaceutical.

Major difference

“All of this has happened in the span of less than two years,” says Richter. “These two young guys went from working in a big organization to having major deals with big companies, and their work is going to make a major difference to patients. They’ve cleared major milestones and they are on a very good trajectory.”

Primarily we want a rock star team. We’re either looking for proven management who have done this before or for young, passionate talent.

For investors and incubators, every start-up brings its own particular attractions to the table: for example, Joseph E. Payne and Padmanabh Chivukula of Arcturus impressed JLABS with their enthusiasm as well as their idea. So while there is no particular blueprint, what is JLABS looking for in general when it comes to selecting projects for incubation? “Primarily we want a rock star team,” she laughs. “We’re either looking for proven management who have done this before or for young, passionate talent. The science and technology must be compelling – and ideally, it should be transformative as opposed to evolutionary.”

The ‘three Ps’

She sums up what she has learned through fostering new talent as the ‘three Ps’. The first of these is problem-solving. “You are always going to have problems along the way,” she suggests. “You have to accept that rather than being frustrated by it.” Her second ‘P’ is persistence. “Never take ‘no’ for an answer,” she explains. That way, you get into the details of the issues and have a better chance of solving them.” The final learning is around people. “You can’t get there alone,” she says. “It’s about empowering people to move forward and be the best that they can be, whatever they are doing.”

Company responsibilities

J&J’s Credo, written in 1943, says the company’s first responsibility is to doctors, nurses, and patients. Then come its employees and the communities in which it works – and finally, J&J’s responsibility to shareholders is spelled out right at the bottom. Of course, the logic is that if J&J gets its other responsibilities right, it will be a successful company and shareholders will make money. But in a pharma industry still struggling today with the idea of patient centricity, it remains a powerful statement of corporate intent. “It’s one of the reasons I decided to come on board at J&J,” Richter admits.

In turn, via JLABS, she wants to enable innovation, to offer entrepreneurs the opportunity to do the best work that they are able to, all the while engaging and supporting the team – and “delivering our shareholders a great return by doing great business”.

No quick fix

The JLABS model may well look attractive to other pharma companies looking to bring more innovation into their own set-ups. But Richter warns that it could not be further from a quick fix. “It’s a long-term journey,” she concludes. “You have to be willing to be there and invest, to roll up your sleeves and be a part of that community.”

She might also have said that it helps to be possessed of wide-eyed curiosity and a desire to bring about positive change. Her progress is a reminder that all businesses could learn a lot from children who are always asking ‘why?’

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