LEAP HR Life Sciences. Evolving Discovery Sciences at Merck. Jill Rapp Dietz, HR Leader
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1 LEAP HR Life Sciences Evolving Discovery Sciences at Merck Jill Rapp Dietz, HR Leader 1
2 Agenda Merck Discovery Story.. What problem are we trying to solve for? Current Environment vs Future State Vision How will we get there? How to Compete for Talent? Timeline Key Learnings 2
3 Background - Jill Rapp Dietz, HR Leader HR Experience: Merck & Co Amgen Genzyme Dana-Farber Cancer Institute Shiva B.S., Management M.S., Human Resources Development 3
4 Merck Discovery Research Strategy Rationale Critical Gap Merck Must Address Biology capabilities to identify therapeutic targets are below current market standard. Modalities that modulate difficult intracellular targets Geographic footprint and incentive model limiting Merck s ability to attract top Discovery leaders and scientists. Core Strength to Capitalize Industry leading functional and technical platform capabilities, and expertise to optimize and advance lead candidates to registered products. Key Future Need Enhanced capability of creating and licensing useful biological insights. Enhanced capability of creating and licensing useful drug modalities Successfully integrate into and become a leading voice and influence wherever present Positioned to harness recent advances in technology to interrogate human biology. Increased alignment with future talent sources and their career expectations. 4 Recommended Actions Targeted geographic redeployment (Bay Area and Boston to complement West Point), and organizational restructuring. Refresh, and, where needed, reinvent approach to Research, focused on piloting approaches in the Bay Area and Cambridge Integrate meaningfully into academic and industrial communities in the Boston and Bay Area Diversification of incentive models to align with project success and compete in talent marketplace.
5 Current State Footprint vs External Environment Only 30% of Merck s internal Research activities are centered in the Boston/Bay Area while early stage innovation funding in the US is highly concentrated in these regions. Palo Alto, CA Other (3%) (9%) (20%) Boston, MA Life Science VC funding trends in top 5 regions, Pennsylvania (29%) (30%) (10%) Kenilworth, NJ Rahway, NJ Merck Research % FTE s by site as of March 2016 = Total ~ 2000 Source: PwC Life Sciences Q MoneyTree Report 5
6 New MRL Discovery & Invention Model CROs Core Discovery Functions: Chemistry Biologics & Vaccines Translational Medicine Preclinical Development Traditional Discovery Research Sites Boston West Point Palo Alto New Discovery Sites Cambridge South San Francisco Universities Institutes Hospitals 6 6
7 Missions of New Sites Cambridge Model Focus on Exploratory Sciences (early biology) Reliant on product invention and development core Scope and Focus Disease Area Agnostic/Mixed Modality 50 scientists Leadership Daria Hazuda, PhD, Vice, President, Infectious Disease & Vaccine Research, Chief Scientific Officer Debra Wisdom, HR Lead, MRL Cambridge, ESC South San Francisco Model Fully integrated Discovery site Reliant on product invention & development core Scope and Focus Oncology, Cardio Metabolic/Mixed modality scientists Leadership Mathai Mammen, MD/PhD, SVP, Immuno-oncology, Cardiovascular and Metabolic Discovery Research HR Director position Posted New sites have been established as subsidiaries (LLCs) to ensure appropriate flexibility vs. core Merck standards, policies, programs. However partnership with core Merck functions will be the expectation (use our world class functional experts) 7
8 We will be competing for sought after talent in high density biopharmaceutical markets Attracting the Desired Talent Phenotype World class scientist, drug hunter, and/or technologist High intellectual curiosity Entrepreneurial, appetite for risk Requires a Differentiated Value Proposition for Discovery Sites Job Design & Work Environment Broad, flexible jobs Scientific autonomy Fluid interactions with external scientists, organizations Access to advanced technology/science Fluid employment relationship Site-based amenities Highly connected, networked Talent magnet, high credibility Compensation & Benefits Flexibility to lead local market in total compensation Benefits offering reflective of candidate preferences Flexible cash allowance No pension, retiree medical Leveraged incentives tied to shareholder, commercial outcomes Performance-based, no forced distribution Lean staffing model funds higher FTE cost 8
9 Discovery Implementation Plan New Discovery Model Creation & Planning Boston Rahway Kenilworth West Point Cambridge ESC SSF Palo Alto Approved plan Hire Discovery Head Announce Intent Incentive Design Communicate Site Missions (11 July) Appoint Leader Establish Subsidiary Reallocate FTEs to fund Bay Area & Cambridge Discovery Start Recruiting scientists Renovate/open research center Lease interim SSF Facility Establish Subsidiary Select long term site Start SSF recruiting Move into interim Facility Maintain Palo Alto Move into new SSF Site and exit Palo Alto Complete SSF recruiting 9 9
10 Key Learnings to date Executive Sponsorship is Critical Always speaking in terms of what the business needs Being willing to take risks and put yourself out there as an HR professional Involve the right people at the right stage Opportunity for HR to lead & push other functions to get on board with business case 10
11 Determination of success: What is the most sensitive/important thing you look at to determine if you re succeeding or failing as a company? David Westin, Bloomberg (July 2016 Interview) The environment in our laboratories. Are we able to recruit and retain the very best scientific talent is the leading indicator of success in our business. Ken Frazier, CEO, Merck & Co 11
12 New Discovery Site Leaders Mathai Mammen, MD, PhD SVP, Immuno-oncology, Cardiovascular and Metabolic Discovery Research Site Leader: Bay Area, CA Work Experiences Merck March, 2016 SVP, Biology-Discovery Theravance SVP, Research & Development Theravance VP, Head of Dept, Molecular & Cellular Bio Theravance Sr. Dir, Medicinal Chemistry Theravance 1997 Founded Advanced Medicine (now Theravance) Cofounded Theravance and subsequently Therevance Bio Pharma Led the companies R&D activities focused on immunology and cardiovascular medicine Has also led multiple groups at Theravance including biology, chemistry and clinical development Authored more than 150 peer reviewed publications and patent and serves on various boards and advisory committees. MD PhD BS Health Sciences & Technology Physical Organic Chemistry Chemistry, Biochemistry Education Harvard Medical School/MIT (HST Program) Harvard University Dalhousie University 12 Merck Present Daria Hazuda, PhD Vice President - Infectious Disease and Vaccines Discovery Research Chief Science Officer Site Leader: Cambridge, MA Work Experiences Chief Science Officer, Cambridge Merck VP, Research Science Infectious Disease Merck VP Franchise WW Basic Head Infectious Disease Merck VP Sci Affrs-Infect ious Disease /HIV Merck VP Virus & Cell Biology SKB Post Doc, Chemistry 20+ years of experience in drug discovery and development including leadership of the research effort that identified Isentress, first in class HIV integrase inhibitor awarded Prix Galien in 2008 Authored more than 180 publications Bernie Field Lecture Award, David Barry DART Achievement Award for HIV Drug Development, Fellow of the American Society of Microbiology Numerous external scientific advisory boards Board of Scientific Counselors for the National Cancer Institute and the American Foundation for AIDS Research (AMFAR) Education PhD Biology SUNY at Stony Brook BS Biology Rutgers
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