When Dr. Francois Nader stepped in as President and CEO of NPS Pharmaceuticals, the company was still reeling from a devastating regulatory setback.
The management team had been certain that its lead product in development would soon be approved. In fact, they were so certain that they had just taken on $200 million in debt, due within one year. When the drug’s approval failed to materialize, the company’s stock price went into a free fall, losing almost 80% of its value in a year.
This set the stage for the success that Dr. Nader, who was named a winner of 2013 EY Entrepreneur Of The Year™ US Award in the Life Sciences category, soon realized. Here are three things we can learn from him.
Be your own “Plan B”
Soon after he joined NPS, Dr. Nader realized that the company’s assets could be redeployed to create value and generate revenue. Adopting a virtual business model, he retained only core competencies and transformed NPS from a failing, old-school manufacturer into a cutting-edge, nimble market leader.
Dr. Nader realized that the company didn’t have a “Plan B” after its original product was not approved, so he created his own. He quickly refocused the company’s development efforts on treating Crohn’s Disease and short bowel syndrome. Both treatments were eligible for orphan drug designation, which entitled NPS to seven years of market exclusivity.
To create an immediate cash flow, he entered into licensing agreements for proprietary compounds and other techniques developed by NPS. This provided working capital and helped the company pay down its debt.
“Make it happen”
Dr. Nader’s entrepreneurial way of thinking has helped NPS become the success story it is today. Throughout the transformation, Dr. Nader has repeated a simple phrase: “Make it happen.” He “makes it happen” by Identifying and hiring the right talent to for a seasoned team of “doers,” thus forming a highly qualified team and strengthening the company’s capabilities. NPS now employs more than 150 people, each of whom is personally accountable and has an opportunity to make a direct, meaningful contribution to the company and its bottom line.
The NPS team is lean and focused, and no longer performs in-house drug discovery and manufacturing. Instead, it partners or outsources those functions to gain access to expertise, technology and facilities. As a result, it is now one of the few pharmaceutical companies focused on finding treatments for rare, debilitating diseases.
Build a winning culture
Dr. Nader has nurtured what he calls a “culture by design” at NPS by repeatedly asking himself the question, “What type of company would I like to work for?”
For him, the answer is one with integrity, respect and a passion for excellence. NPS employees live by these values and embrace an overarching “we” mentality.
To ensure that employees live the values he embodies, Dr. Nader enforces transparency in all company dealings, holding frequent town hall meetings and informal lunches to encourage open dialogue. He also personally welcomes each new employee, inviting them to his office for a chat.
This focus on culture and values has helped NPS achieve a low voluntary turnover rate of 4% while increasing revenues by more than 300% since 2011. And many of the employees who left the company during that disastrous “near-death” period have since returned.
Today, with its lead product — Gattex® — approved and in the marketplace and several exciting new treatments on the verge of approval, NPS is well positioned to enjoy a bright future. And it wouldn’t have happened without Dr. Nader’s dedication to bringing NPS back from the brink of failure. His story exemplifies the resiliency that is shared by all successful entrepreneurs and proves that necessity truly is the mother of invention.