Former Eli Lilly Exec Fosters Capitalism through Biotech Entrepreneurship
Donald W. Grimm, Former President, CEO and Chairman, Hybritech, Inc.
The world of biotech has Eli Lilly & Co. to thank for sending Don Grimm to San Diego in 1986 as president, CEO and chairman of Hybritech, Inc. While at Hybritech, Grimm orchestrated the development of Prostate Specific Antigen (PSA), the most significant new cancer diagnostic test ever developed for men. Hybritech went from $50 million to $150 million in revenues under Grimm’s leadership.
Grimm had been at Hybritech less than a year when the University of California at San Diego (UCSD) asked him to volunteer time and expertise to help develop an office to foster the commercialization of their biotech inventions. Known as CONNECT, it later expanded its focus from UCSD to the entire San Diego area.
“What you find in health care is a lot of emotion, which doesn’t necessarily equate to a marketable product,” says Grimm. “Scientists are thrilled about their inventions and want to move them forward. But they typically have no expertise in separating an interesting invention looking for a home from one that should be commercialized.”
Shaking Things Up at the FDA
At CONNECT, Grimm helped review projects, focus resources, tell the CONNECT story and raise money. From that work, as well as his experience at Hybritech, he became well acquainted with the dysfunctional relationships between the Food and Drug Administration (FDA) and biotech companies that were inhibiting progress.
“The FDA might say you need to do a certain clinical trial to move your drug forward, which might take two years,” he said. “But by the time you presented your results, the person who gave you that advice would be gone and someone else would tell you they wouldn’t have recommended that study and tell you to do a different study.”
Recognizing that “everybody knew about these issues but couldn’t do anything about them because they weren’t documented,” Grimm was able to gain support in 1995 for a university-sponsored survey, in partnership with Price Waterhouse Cooper. The FDA, which welcomed any effort that might result in more funding for the agency from Congress, extended its cooperation.
The three surveys Grimm and his colleagues conducted in 1995, 1997 and 2000 led to new legislation stipulating that agreements reached by an initial FDA reviewer cannot be changed by sub-reviewers unless the change is based on new information that provides a scientific reason.
“The study would not have been done without Don,” says Terry Bibbens who, under Bill Otterson’s leadership, helped launch CONNECT in 1982 and was on its staff from 1992 to 1995.
“Don probably put in 25 hours a week for three years on that project,” says Bibbens. “Besides his energy, he had the ability to see the big picture, as well as a marvelous sense of humor and a willingness to share credit.”
Several years have gone by since the last survey, says Grimm, because of the lack of consistent leadership at the FDA. With the recent arrival of a new commissioner, discussions are now underway to repeat the survey.
Angel in San Diego and Pittsburgh
Grimm’s work for CONNECT on the FDA project began shortly after his early retirement from Eli Lilly in 1993. Freed from the corporate grind, Grimm set about giving back in several arenas, from nonprofit and for-profit boards to tech transfer and angel investing.
On the for-profit side, Grimm has served on the boards of several startup companies, including Aegis, Angstrom, CellzDirect and, for the past seven years, Invitrogen, the only one that’s gone public.
He is on the advisory boards of Scripps Clinic, the Green Cancer Center at Scripps Clinic, the UCSD Cancer Center Foundation and the Office of Enterprise Development at the University of Pittsburgh, where he earned his B.S. in pharmacy as well as an MBA.
“Twenty years ago,” explains Grimm, “there were three centers of biotech: the Bay Area, Boston and San Diego. Pittsburgh today is like San Diego 20 years ago. It hasn’t developed the infrastructure to commercialize biotech – the venture capital, the experienced CEOs, the accountants and the corporate and patent attorneys that understand this field.”
In 2001, when asked to join the advisory board of start the Office of Enterprise Development (OED), Health Sciences, at the University of Pittsburgh, Grimm readily agreed.
“The CONNECT model, which Don was very familiar with, was something I wanted to replicate,” says OED Director Carolyn Green. As a member of the advisory board, Grimm flies to Pittsburgh three times a year for meetings to give advice on the university’s recently patented discoveries, help OED connect with corporate leaders and develop venture capital, and provide input on OED’s organizational structure and priorities.
Shortly after agreeing to help in Pittsburgh, Grimm accepted another challenge back in San Diego. A board member of the San Diego Tech Coast Angels, Grimm was approached by Michael Lutz, a physicist new to San Diego interested in biotech angel investing. Why, Lutz wanted to know, was Tech Coast Angels all tech and no biotech? The answer largely had to do with its 60-person membership that included only three individuals involved in life sciences.
“Biotech entrepreneurs in San Diego at that time would not think of the Tech Coast Angels as a source of funds for their startup companies because we didn’t have enough people who understood the bio side of things,” says Lutz.
Grimm held a meeting which resulted in the founding of the San Diego Tech Coast Angels BioMedTrak in the summer of 2002. BioMedTrak members, which now number more than 20, meet every three weeks for an educational program and two “bio-preneur” presentations. According to Lutz, who serves as the BioMedTrak administrator, more life science deals than high-tech deals were funded in the first half of 2005.
Sharing Expertise for a Better World
Terry Bibbens observes that “Don is not a 40-hour a week guy,” which helps explain how, in addition to his work for CONNECT, the Office of Enterprise Development in Pittsburgh, various boards of directors and the Tech Coast Angels, Grimm has also found time to share his business expertise with city and county governments.
As chair of the San Diego Mayor’s Task Force on Effectiveness and Efficiency in City Government, Grimm and his team reviewed and made recommendations on all aspects of city government. To his satisfaction, more than 80 percent of the recommendations were acted upon. As chair the San Diego County Economic Advisory Board, he led a review of every county law and regulation on the books to determine whether they still made sense and to recommend whether to retain, revise or eliminate them, resulting in a more business-friendly environment for the City of San Diego.
Grimm’s reputation for wisdom and a willingness to share it yields frequent requests for other kinds of help as well.
The other day, he got a call from a friend who’s teaching a course in the new Executive MBA Program at UCSD’s Rady School of Management asking if he would present a session. Of course, he said yes.
“Mentoring,” says Grimm, “is something I do all the time. I did it this morning.”
Why is all this so important to him?
“In my opinion,” says Grimm, “capitalism is the best way to make the world better. We don’t have the resources to do everything, so the question is how do we use what we have to help the largest number of people? What capitalism does is involve large numbers of people in sorting through resource decisions.”
“One of the easiest ways to foster that in a community like San Diego is to get very involved with entrepreneurship. Help young people start businesses and become capitalists. That’s really why I do it. It’s no more complicated than that.”
© 2006 Ewing Marion Kauffman Foundation. All rights reserved.