Doug Janzen, Cardiome Pharma's CEO, is optimistic the company will become even more profitable.
Doug Janzen, president and CEO of Cardiome Pharma, saw his company's revenues skyrocket in 2009.
Cardiome Pharma Corp.’s headquarters leave no question as to what this biotech company is all about. The first thing visitors see upon entering the office on the UBC campus is the bouncing line of a cardiogram painted up and down the hallway. And after a promising and financially successful 2009, the mood around the company notching the biggest revenue gain among B.C. public companies in 2009 is decidedly upbeat.
In March of last year, Cardiome signed an $800-million licensing agreement with pharmaceutical giant Merck & Co. Inc. – the largest in Canadian history, according to CEO Doug Janzen – and the first milestone payments from the deal saw revenue skyrocket to $54.7 million in 2009, up from $1.6 million in 2008.
The draw? Vernakalant, Cardiome’s drug-based treatment for atrial fibrillation, the most common form of cardiac arrhythmia, affecting between seven and 10 million people in the Western world. The drug has been advanced for clinical trial and the company anticipates European approval this year. The rosy outlook was a long time coming for Cardiome, which, according to Janzen, has beaten the odds and then some.
“The fact is, stunningly few products actually meet the standards of approval,” he says against an oceanside backdrop from his sixth-floor corner office. Only about five per cent of products taken into clinical trials will prove effective, Janzen explains. “So out of a pre-clinical candidate, it’s almost one out of 100 that you actually develop.”
Even more rare is the chance for a single company to discover and develop a product itself, making Cardiome an anomaly. “It’s like winning the championship; it doesn’t happen often,” Janzen says. “It’s a real credit and feather in the cap to a team that’s able to conceptualize a product that’ll make a difference and develop it in a way that’ll ultimately benefit patients.”
That couldn’t have happened without Merck coming on board, he says. Cardiome started looking for a buyer or licensing agreement during a tumultuous 2008. “We ran into an FDA delay in the first part of the year, which was a frustrating thing for the whole company. And then in the back half of ’08 we saw the demise of capitalism, more or less,” he says.
The whole debacle had Janzen, a former investment banker with a science background, determined to find a way to make the company less dependent on capital markets.
The Merck deal got the company on solid financial ground with the upfront and near-term financing it needed to bring its product through to the clinical-trial stage. Janzen expects 2010 to be an even better fiscal year with Merck handling the Vernakalant rollout in the European market and royalties expected to start coming in for Cardiome. In fact, Janzen is optimistic the company will become increasingly profitable for the foreseeable future, as he believes Vernakalant is slated for U.S. approval in 2011 or 2012.
It’s all been a whirlwind of success that Janzen hopes will have people taking his company a little more seriously. “Biotech companies tend to be run as science projects,” he says. “It’s only once they start getting approvals they can be run as a real business.”