Seqirus Exec on Vaccine Differentiation
Brent MacGregor has been around the world, with some of the top companies in the vaccines industry.
He put in 16 years at Sanofi Pasteur, most recently serving as Managing Director in Japan. Following Sanofi Pasteur, he was president of Novartis Vaccines U.S. and then CEO for Influenza Vaccines. At that point, Novartis was involved in selling their influenza vaccines business to the Australian company CSL That vaccine company eventually became Seqirus, where Brent became SVP for Global Commercial Operations. His vision, from 2016 on, was to establish a portfolio of differentiated influenza vaccines despite the traditional image of the flu business as a commodity enterprise. How he accomplished that was the best part of the story. It involved everything from identifying and building a leadership team to changing the image of the product, and ultimately helping to lift the company from a negative balance sheet to profitability that seemed unachievable to many, and annoyed the competition.
A PRODUCT PERCEIVED AS COMMODITIZED, A COMPANY IN THE RED CSL had an existing vaccines business and folded the Novartis business into it, creating the company name Seqirus to indicate a new entity. Brent moved from CEO/ Global Head of the entire Novartis Influenza business to SVP Commercial Operations of the new Seqirus entity in 2016. At this point, the company was unprofitable. CSL informed the market (the Australian Stock Exchange, ASX) that they intended to make it profitable by the end of their 2018 fiscal year. Today, Seqirus offers a portfolio of differentiated seasonal influenza vaccines, based on their innovative cell-culture and adjuvant platforms, a pandemic countermeasures business, and in Australia and New Zealand a suite of in-licensed vaccines and pharma products. Traditionally, influenza was seen as a commoditized space where vaccines were made the same way, regardless of manufacturer, using egg-based manufacturing technology. The only way to “differentiate” was through aspects like pricing and speed of delivery rather than product efficacy, because no one could claim a better medical benefit from their vaccine. The World Health Organization, WHO, identifies flu strains each year and provides the virus seed stock to each manufacturer to develop their branded vaccines. But physicians and pharmacists alike often substitute the brand they have in stock for another that’s considered comparable. Recently, innovative vaccines have started to come onto the market and it was up to Seqirus to differentiate its own innovative vaccines from those its competitors.
THE MARKETING STRATEGY: DIFFERENTIATION WHERE NONE EXISTED BEFORE; A VIABLE ALTERNATIVE WHERE IT DID Brent formed a seven-person leadership team from former Novartis and CSL executives. All the members were competent in their own realm, but Brent realized that this does not necessarily lead to a well-functioning team. To create that bond, he first built a common belief in the product and the mission. Since each flu season differs from the last, it is important to generate real world evidence (RWE) from the flu season just passed to demonstrate that your vaccine actually performed as you said it would, in the context of what your clinical trial showed. It was critical for the Medical Affairs team to demonstrate the effectiveness of the cell derived product, and of the enhanced immune response offered by adjuvants. The next task was to build a capability in government affairs, in public policy, and in health economics, as well as a marketing strategy. The challenge was to advocate to the Centers for Disease Control and Prevention (CDC) and other healthcare authorities to recommend Seqirus vaccines. In the caseof its adjuvanted vaccine (FLUAD), Seqirus was entering a space already occupied for some years by a competitor with the same indication. The Seqirus team was focused on establishing Fluad as a worthy alternative for that indication. Over time, the perception in the industry is slowly changing from the commoditized view, to recognize that one flu product is not like another.
BUILDING THE COMMERCIAL TEAM, PROTECTING THE BOTTOM LINE At first, it was a challenge to attract more top-level talent, since no one had heard of Seqirus, and it had no track record. Up against top competitors, the company quickly took to building a more visible public profile, leveraging RWE and new investments in its technology. Gradually, Brent was able to build his team and bring in fresh faces with competitive backgrounds and valuable perspectives. Even though Medical Affairs did not report directly to Brent, he and his team collaborated with their medical colleagues to support the overall mission of the company. He also focused on adding talent in health economics and pricing/contracting strategy, which were critical specializations to support a differentiation strategy, as well as marketers and key account people. Still, given their financial situation, he had to stay as lean as possible on commercial spend while supporting the build of the brand. Getting the business to profitability was a vital objective.
THE SWING TOWARD PROFITABILITY Brent knew that its competitors would underestimate the Seqirus team because they were the newcomer in an established industry. Yet by 2017, they had achieved exponential growth, which contributed greatly to the profitability objective. Seqirus reached profitability by 2018, and Brent projects the growth in revenue and profit will continue at a strong pace. Still, at first management didn’t project too far into the future. The initial focus was entirely about reaching profitability. Brent sees this as two different visions. One was to secure a foothold and prove their worth. He practiced transparency: everyone knew the numbers they started with were not promising, but they needed to believe in how they were getting from here to there. “This transparency is not the norm at most companies,” says Brent. “But the leadership team of Seqirus felt that the best policy was to be realistic, in order to inspire confidence.”
CREATING THE CULTURE Then came the turnaround in leadership strategy. Brent says “I came to feel that my team was highly competent individually, but that we were not leveraging our collective talent for exponential growth going forward. I was a big fan of the ‘What got us here won’t get us there’ mantra and believed that we, as a leadership team, needed to re-invent ourselves to become more effective at delivering to even greater expectations in future.” That was dependent on building a unique company culture. “Openness and collaboration were key to making it all work,” he says. “Friendliness and collegiality contributed to the feeling that everyone was on the same page, part of a streamlined machine.” Brent instituted a Transformational Leadership program in 2018, with the “What got us here won’t get us there” ideal as a driver. They needed to optimize the caliber of team members, make the whole greater than the sum of the parts. The point was to use everyone’s strengths to their ultimate potential. There was a focus on continual improvement and open collaboration. In short, what each leadership team member needed to become was an enterprise leader, not just the leader of their respective function. And this was the point at which they opened up a view of the future, and allowed themselves to ponder “What does 2030 look like? How do we keep differentiating products that have been commoditized for decades?”
A DIFFERENTIATED LEADERSHIP Unusual for such a successful leader, Brent preaches humility. “We need people who are smart and unafraid to speak up and debate, to offer a view that may not agree with top management. You need to be convinced that your view alone is not the best, but can absolutely be improved upon, and your people need to believe that their unvarnished feedback is desired and valued.” The result, he says, is to “Leave people bigger.” A disruptive leadership team culture encourages debate and a multiplicity of solutions. “It doesn’t always have to be the perfect solution; sometimes an 80% solution is enough to get started. The process is to try things; monitor closely; adjust along the way; and don’t give black marks to people who proposed things that didn’t ultimately work. Encourage creativity and participation.” Finally, “Reward people accordingly – not just financially, but demonstrably. Spread the credit, even to people down in the organization who played small parts. Everyone’s contribution is important. That’s how you streamline progress.”