In 2022, Pfizer acquired Arena Pharmaceuticals, a San Diego-based clinical stage company developing innovative potential therapies for the treatment of several immuno-inflammatory diseases. Amit Munshi, former President and Chief Executive Officer, talks with Switzerland Global Enterprise about why Arena Pharmaceuticals’ Swiss hub was not only crucial to the company’s success, but how other global biotech companies can benefit from a presence in Switzerland.
Switzerland Global Enterprise | Director Investment Promotion
Former President and Chief Executive Officer Arena Pharmaceuticals
You have lived and worked in biotech hubs like San Diego, Boston and Switzerland. What makes Switzerland unique?
In building a global pharmaceutical business, having the right people for every stage of development is critical to operational success. Over the years, I have set up Swiss hubs for three of my companies. The decision to do so was driven not by tax efficiency but rather by a desire for operational excellence.
Managing global clinical studies requires a global skillset, and having excellent infrastructure was critical. For example, at Arena Pharmaceuticals we had over 500 clinical sites in 40+ countries around the world. It is very difficult to manage these geographically dispersed clinical programs based solely in San Diego or Boston. In our Swiss office, the team spoke 20+ languages and had experience with regulatory interactions globally. This accelerated our responsiveness and allowed us to manage timelines even during the pandemic. Switzerland provided the right, globally aware talent base.
What was a key factor for the success of Arena Pharmaceuticals?
There were many success factors, including having the right clinical-stage assets and of course being able to capitalize on these. Of our 500 clinical sites, fewer than 20% were in North America. We needed to recruit patients, manage supply chain and regulatory interactions throughout Europe, the Middle East and Asia. Switzerland offered us the infrastructure to make that happen.
Where does Switzerland stand when it comes to talent in biotech?
Switzerland attracts an internationally diverse workforce in biotechnology. Experienced scientists and clinicians are willing to relocate to Switzerland due to the quality of life, healthcare, and central location.
What are the biggest current challenges for biotech companies to be innovative and globally competitive, and what role can Switzerland play?
At the moment, the single biggest issue for the biotech industry is capital. The current public capital market environment makes it difficult for biotech companies to continue to grow and survive.
Switzerland has significant institutional capital, but high-risk/ reward biotech has not received its proportional share of those resources. The Swiss challenge is to move from a conservative deployment of capital to being able to allocate capital to highrisk ventures. Swiss capital could be used to build Swiss-based companies. The presence of world class universities, research capabilities and talent base are existing core ingredients in building local biotech companies. Getting critical momentum with high-risk capital would go a long way towards propelling Switzerland further in biotech innovation.
What fascinates you about biotech?
There are few industries that attract brilliant people all focused on improving the human condition. After over three decades in the business, I am constantly astounded by the increasing rate of scientific progress.
There are few industries where you can say that your legacy (the drugs you bring to market) will persist long after you leave this planet.
What is your advice to growing biotech companies in terms of setting up their global strategic footprint?
After 32 years in pharma/biotech, I believe we have moved away from building sustainable businesses, and the emphasis in the last decade has been to build and sell. We need to get back to the idea that we can build long term, sustainable biotech businesses. This requires higher-risk tolerant, patient capital.
Today, I believe that a biotech company is better equipped for growth with a US base and a Swiss hub. Pattern recognition with investors and access to capital are paramount. The predominant source of capital likely will continue to be the US capital markets until the mindset on capital allocation changes in Europe. When it does, you may see Swiss global biotech companies setting up US hubs. That would be the ideal situation for the Swiss biotechnology industry.
Can you describe Switzerland in three words?
To best describe Switzerland, I believe you must describe the feeling of being there – very difficult to do in three words! I have a 30-year relationship with Switzerland and hope to return in my future ventures or maybe even to live there again.