By 1986, the biotech industry had taken a firm footing in the minds (and pockets) of the financial community and its to-be-iconic annual gathering, now called the J.P. Morgan Healthcare Conference (then called Hambrecht & Quist or H&Q), had convened the biotech market makers for the fifth time. The energy was high. Since the 1980 IPO of Genetech, the industry’s iconic poster child, 41 subsequent companies had found their way onto the public stock markets, including companies such as Biogen, Immunex, Amgen, Chiron, and Scios (then known as Cal Bio), among others.
Following a year in which the big ticket monoclonal antibody-focused buyouts for $300M each of Hybritech by Lilly, and Genetic Systems by Bristol-Meyers Squibb, had helped to put a premium on biotech valuations, the capital markets were being pulled forward by the continued momentum of technology. Only four years after the personal computer had been named “Man of the Year” by Time Magazine, 1986 was the year IBM launched something they called the convertible or “laptop.” Not just a personal computer, but one that had a battery which allowed you to carry the PC around with you and work wherever you might be, can you imagine! At 13 lbs, it also doubled as the world’s first digital workout device.
By 1986, even outer space seemed to be reduced to the routine. But this confidence was shattered when on January 28, at 73 seconds into its tenth orbital mission, the space shuttle Challenger exploded over the Atlantic resulting in the tragic loss of all seven crew members on-board. The accident resulted in a 32-month shuttle flight hiatus and a high-profile presidentially commissioned investigation that identified flawed O-rings on the solid rocket booster as the culprit. The design problem had been known about, but insufficiently addressed for years. This case study in mismanagement and ineffective issue resolution has been reviewed and retold to students and management teams countless times since.
Closer to home, Reagan and Gorbachev were making real progress on disarmament agreements, turning the corner on the Cold War as we had known it. These changes set the stage for the falling of the Berlin wall just two years later and contributed to the 1991 unwinding of the USSR generally. But inside what was then still Soviet Ukraine at the Chernobyl Nuclear Power Plant near the town of Pripyat, the world’s first and worst nuclear power plant accident in history occurred (a level seven accident, the maximum classification; the only other being the Fukushima Daiichi nuclear disaster in 2011). An event that has, even to this day, dramatically and durably shifted global policy and public confidence away from greenhouse gas friendly nuclear energy to coal and other, more troubling to global warming, energy sources.
The first J.P. Morgan Healthcare Conference in 1982 had coincided with the approval and launch of the very first recombinant DNA based product, Humulin® – recombinant insulin that was discovered by Genentech and marketed by their partner Eli Lilly and Company. This same year, the CDC had settled on the name “Acquired Immunodeficiency Syndrome,” or AIDS, to describe a newly recognized deadly condition. Five years later, AIDS patients enrolled in the treatment arm of a randomized trial of AZT were actually staying alive. This finding triggered the first expedited FDA approval (1-AA priority review designation for AIDS drugs), with the agency’s review of the Burroughs Wellcome NDA accomplished in less than four months.
By 1985, Genentech had received FDA approval to market its first product, Protropin®, a growth hormone for children with growth hormone deficiency. This represented the first recombinant DNA product to be manufactured and marketed by a biotechnology company. Later in 1986, their interferon alpha-2a product, licensed to Hoffmann-La Roche, Inc. as Roferon-A® for the treatment of hairy cell leukemia, also received approval from the FDA.
Biotechnology was being reduced to practice, and markets for biotech-based products were starting to swing open. By the end of 1986, 26 biotech companies had been newly embraced by public markets and the minds and imaginations of investors, breaking all previous annual benchmarks. Among them were companies like Genzyme and others who were maniacally focused on bringing new solutions for which no pharmaceutical company had proven capable of. They were picking the untouchables, the diseases for which little if any hope had existed, and bringing new types of diagnostics, technologies and related treatments toward patients and markets. The race was on for products that were high-risk, expensive, unprecedented and slow to develop, fueled by full access to public markets and the potential lure of eventual big pharma acquisitions.
“The news story” of 1982, as it turned out, was not the first ever J.P. Morgan Healthcare Conference, but rather the bold flight of a brave Californian in a helium-balloon tethered to a Sear’s aluminum lawn chair. So called “Lawn chair Larry” – captured the psyche of the nation (and the world) with his willingness to take bold risks to see and do what others would never consider. Five years later, “the good news story” of the year would again look toward the sky for inspiration. Just 100 miles northeast of Larry’s 1982 flight path another set of bold explorers similarly captured the attention of the world. Tucked into the ~900 lb fuselage of a Rutan Model 76 Voyager, Dick Rutan and Jeana Yeager took off on the first ever non-stop flight around the world (without refueling). In front of 55,000 spectators and a large press contingent, including 23 live feeds breaking into scheduled broadcasting across Europe and North America, their Voyager safely came down to earth, at the same airfield nine days and three minutes later with just five gallons of fuel in the tank to spare. Among setting many new aviation records Rutan and Yeager taught us all a thing or two about “burn rate.”
The tragedies of 1986 were counterbalanced by boldness and renewed bravery. The loss of Challenger’s “remarkable seven” as they roared toward space and the courage needed to install shielding across the failed reactor cores in Ukraine; political leaders who could imagine a world free of nuclear arms; all were fundamental statements about the nature of progress in and of itself. For each two steps forward, we must be prepared to take (at least) one step back. Energy pioneers, astronauts, biotech executives, record-breaking aviators, investors and even patients themselves, showed the world the power of the possible, when in the hands of the capable, bold and willing.
History has its eye on 2016 as well. Let us make some.