President and CEO, Tekmira Pharmaceuticals Corp.
When two companies have been bitter rivals – competing in the markets and clashing in the courts – how do they forgive, forget and hold hands?
Burnaby-based biotechs Tekmira Pharmaceuticals Corp. (TKM-T) and Protiva Biotherapeutics Inc. have played out a fierce family drama in recent years. Protiva was spun out of Inex Pharmaceuticals Corp. in 2001 and later sued its parent over an intellectual property dispute. Inex had accused its rebellious offspring of using ideas it didn’t own, a charge maintained by Tekmira when it was created out of Inex last spring.
But the dispute is over; all legal actions stopped when the two factions decided to come together at the end of May. The two companies will unite under a single roof in the coming months, pooling their knowledge in hopes that they’ll gain more through peace than by war. Pushing that vision is now the job of former Protiva CEO Mark Murray, who will become president and CEO of the amalgamated company, which will retain the name Tekmira. (Timothy Ruane, the president and CEO of the original Tekmira, is resigning but will contribute as a consultant.)
At least in the business pages, the legal dispute between the two companies has overshadowed the science. Murray says he hopes the merger will change all that, and the science is indeed fascinating. Both companies are working with a technology called RNA interference, a new means of “switching off” disease-causing genes. Combining the research of the two companies will make the merged entity a major force in their field, Murray says, and give investors new cause for confidence. But it all depends on whether they can make the marriage work.
How did you get involved with Protiva? Back in 2001, I got involved with some venture capitalists and the principals of what was then Inex, and we all put the deal together.
Protiva and Tekmira have quite a history.They started from common roots. We founded Protiva by acquiring some technology from Tekmira back in 2001. We went separate ways for a number of years. Then, in the last six months, we’ve recognized the tremendous opportunity to put the companies back together, so that’s what we’ve agreed to do. There have been a few bumps in the road and we’ve had a few disagreements, but that is all behind us now.
How did the legal action get started?It began because there was a disagreement about the technology that Protiva had developed subsequent to the spin-out. Protiva got to the point where it felt that the disagreement needed to be resolved in the courts. So we initiated a lawsuit in the Supreme Court in order to get it adjudicated.
How did the lawsuit affect your work?The key thing is that there is uncertainty around the technology, and that’s not good. Everybody continues to do work in the lab and sell products, but in the scheme of things everybody – your partners, your investors, your employees, all your stakeholders – would like to have certainty with respect to what belongs to you and what belongs to other people.
How did the merger get started?Over the years, myself and Timothy Ruane, the CEO of Tekmira, had talked about it from time to time, and there were various things that were in the way that didn’t make it feasible. For example, Tekmira had some complicated restructuring that they had to carry out and couldn’t entertain a merger until that was cleared up. But Tekmira did that and we both found ourselves working in similar technology spaces and looking at similar opportunities and the more we talked about it, the more obvious it became that it was just a great opportunity to put the companies together, put all the technology in one place, put all the intellectual property in one place and just dominate that space. Do the staff at the two companies all know each other?Many of them do, of course. They have all been involved in the Vancouver biotech scene for years, so they know each other in that world. There are Protiva employees that used to work at Tekmira and vice versa. They really live in a pretty small world in Vancouver.
What are the challenges in getting these two companies together, given recent history?I don’t want to minimize them, but I think they’ll be overcome pretty quickly, and I think the reasons are, first of all, the historical ties that have been there and the common scientific world that a lot of these guys come from. But I think the key thing is that everybody recognizes this as a great opportunity. By putting the companies together, both organizations are going to be able to do what we have aspired to do, but in a bigger and better way.
What’s your role as CEO in this?My role will be to lead the charge, first of all by communicating it. I think it’s very clear to me and I made it clear to everyone in both companies and I think that everyone sees it in the same way. I think once you’ve bought into the opportunity, looking over your shoulder about what might have gone before this is not very useful, not very interesting.
What’s the next step?We’re going to turn our attention to moving our first couple of products, based on RNA-interference technology, into human testing, and we hope to get our first product into clinical trials sometime in the middle of next year, and that will be a very significant step for us and for the field.
How will the day-to-day work change?We’re going to have to physically integrate and move from one facility into the next. It will take us a few months, but we will literally merge into the same building. But much of our work will continue as it has been as we go forward.