Executive of the Year: Pushing the biotech envelope
CEO Watkins leads Human Genome Sciences into profitability and cutting-edge treatments
Not long ago, Renée Winsky congratulated H. Thomas Watkins on his company's encouraging clinical trial results for its new treatment for the autoimmune disease lupus.
"Tom's response was unadulterated enthusiasm about the possibilities of helping patients with lupus," recalled Winsky, CEO of the Tech Council of Maryland, who worked with Watkins on the Maryland Life Sciences Advisory Board when she was leading the Maryland Technology Development Corp. "That's Tom. It's about the patients and finding treatments and cures."
Along the way, Watkins continued to play a high-profile role in biotech, professional and community circles. He chairs the Maryland Life Sciences Advisory Board, which issued a detailed plan for the BioMaryland 2020 initiative last year. He serves on other key boards with companies and organizations, from Vanda Pharmaceuticals and the Biotechnology Industry Organization to the U.S. Chamber of Commerce and National Symphony Orchestra. He was named the 2009 Business Leader of the Year by the Montgomery County Chamber of Commerce.
Based on factors such as business success and commitment to community service, Business Gazette editors and executives selected Watkins as Executive of the Year for 2009. The Gazette's annual honor dates back to 1997.
‘Terrific set of moves'
Having such a successful year during an otherwise severe economic downturn was the result of years of hard work and careful planning, as well as excellent employees who are motivated by helping patients and finding cures to troubling diseases, said Watkins in a conference room at his company's spacious three-building campus on Shady Grove Road.
"This company's founders made a terrific set of moves to help us get to where we are," said Watkins, 57. "It is interesting that it all came together for us around the same time."
The lupus treatment has the potential to be the first approved such drug in more than 50 years. HGS is partnering with GlaxoSmithKline to sell Benlysta, which Watkins hopes to see on the market by next year, pending regulatory approval. Analysts expect annual sales to eventually exceed $1 billion.
Watkins estimated that the company had already spent "hundreds of millions of dollars" on research and development costs for the lupus treatment over more than a decade. "Several hundred employees have worked on it," he said. "It's a high-risk business. It is a very time-consuming and capital-intensive process."
Last year, Benlysta succeeded in two phase 3 clinical studies, helping raise HGS stock, which was as low as 45 cents in March. It was selling at $27.47 Thursday afternoon.
Two phase 3 clinical trials involving Zalbin to treat the liver disease chronic hepatitis C also have returned positive results since December 2008. Watkins hopes that product will also hit the market by next year, again pending regulatory approval.
In addition, the company has been delivering tens of thousands of doses of the anthrax treatment raxibacumab to the U.S. Strategic National Stockpile. The latest purchase order is for 45,000 doses of raxibacumab over a three-year period, and the first delivery was in November 2009.
The company hit a snag in its efforts to win marketing approval when a Food and Drug Administration advisory panel in October questioned the anthrax treatment's efficacy in trials involving monkeys and rabbits. Those tests showed that adding the HGS treatment, called ABthrax, to a conventional regimen of antibiotics had little benefit. The company plans to respond to the FDA concerns.
Watkins has done an outstanding job in leading the company's continued development of new medicines to treat and cure serious diseases, said William A. Haseltine, HGS founder and its CEO until his retirement in 2004. Watkins was chosen to succeed Haseltine, who is now president of Haseltine Associates in Washington, D.C.
"These will be the first genomic based drugs to benefit patients, fulfilling the dream of the original founders of Human Genome Sciences and all those who have helped to make genomic based drugs a reality," said Haseltine, a pioneer in genomic medicine who taught at Harvard University before founding HGS in 1992.
The company, which went public in 1993, has grown to number among the larger biotechs in the state with some 900 employees, up from 284 in 1997. Most of those are in Rockville, though the company has offices across the nation and in Europe. HGS plans to soon add up to 100 employees across the nation, with many in sales and marketing to work on campaigns to market the new products, Watkins said.
Montgomery College has been a good source to find qualified employees, he said. "They have a really good biotechnology program," Watkins said. "They turn out to be terrific employees."
Ohio roots, college in Virginia
Growing up in Cleveland, Watkins decided to move east for college, attending the College of William and Mary in Williamsburg, Va., to earn a bachelor's in accounting. He was impressed with the school and tired of brutally cold Ohio winters. He also liked that College Football Hall of Fame coach Lou Holtz led the football program there and played for two years as a tight end.
"I didn't go to college there to play football," Watkins said. "But I am supportive of athletic programs. You learn concepts that help you throughout life, such as discipline and team work."
He grew intrigued by leadership and management in college. He attributes a good part of that to his father, Hays T. Watkins Jr., who led the Chesapeake & Ohio Railway and CSX. Watkins' first job out of college was with the accounting firm Arthur Andersen & Co. in Washington, D.C., where he grew to appreciate its urban neighborhoods, culture and architecture.
After a few years in the corporate world, Watkins returned to the Midwest to earn his master's in business administration at the University of Chicago Graduate School of Business. He worked as a management consultant with McKinsey and Co. in Chicago for six years, and then started an almost two-decade stint with Chicago-area pharmaceutical giant Abbott Laboratories and its affiliates in the U.S. and Asia.
In his first position with Abbott, Watkins started a business to commercialize rapid tests and small instrument-based testing systems for physician offices. He was promoted to divisional vice president of the Pharmaceutical Products Division and then to sector general manager for Benchtop Systems in the Diagnostics Division, where he supervised about 450 employees and was responsible for worldwide development of small laboratory instrument systems. He soon was promoted to area vice president of Abbott's Diagnostics Division affiliates in Japan and Asia, supervising some 1,300 employees. He was president of Abbott's Japanese subsidiary and was later promoted to corporate vice president and vice president of Abbott's corporate marketing and distribution division.
Living in Japan for four years was an eye-opening experience — not just living in a different culture, but learning how businesspeople operate there, Watkins said. He impressed his bosses enough to be chosen as president of TAP Pharmaceutical Products, which was jointly owned by Abbott and Japanese pharmaceutical giant Takeda Pharmaceutical. Watkins presided over its annual revenue growth from some $2 billion to $4 billion and worked to move products into the marketplace more rapidly.
The Chicago business community is larger than the one in the suburban Maryland-Washington region, but does not have nearly as much federal government influence, Watkins said. "Here, it was not as obvious that there was a recession going on," he said.
Community service important
While his first priority is HGS, community and professional service is important to Watkins.
"I try to be careful not to take on too many tasks," he said. "Serving on other boards can be helpful to our company. You can get a good perspective of what is going on in the community. It makes us a better company."
For instance, chairing the Maryland Life Sciences Advisory Board gives Watkins a greater understanding of trends and developments within the state's biotech industry, Watkins said. And being on the board of the Biotechnology Industry Organization, a national trade association that is based in the District, gives him insight into the national industry.
Service on the U.S. Chamber of Commerce board keeps Watkins abreast of general business trends. He also supports groups he appreciates, such as the National Symphony Orchestra and the College of William and Mary Foundation.
Watkins has brought to the BIO board an invaluable combination of passion for biotechnology and business acumen, said James C. Greenwood, president and CEO of that organization. Watkins was among the speakers at last year's Mid-Atlantic Bio Conference in Washington.
"He is well-respected by his colleagues and serves as a highly effective spokesperson in communicating the value and promise of biotech to help heal the world," Greenwood said. "Tom's company is one of the leading innovators in our industry. Under Tom's leadership, HGS exemplifies the best of biotech — delivering breakthrough science that provides new hope for patients around the world."
The state Life Sciences Advisory Board's detailed plan for the BioMaryland 2020 initiative that it released last year includes recommendations such as improving biotechs' access to capital though a state life sciences venture capital trust, upgrading bioscience infrastructure and expanding tax credit programs. Some recommendations, such as establishing the Maryland Biotechnology Center, have already been achieved.
In the present budget-crunch climate, it is hard to move ahead with everything, said Watkins, who praised state leaders for their support during the recession.
"We have to be realistic," he said, pointing out that it is a 10-year plan. "Other states, such as Virginia, are being aggressive in growing and attracting biotechnology companies. So we have to be forward-looking."
Maryland's biotech industry contains a wealth of talent, including from private and public sources, he said. There are a good number of small companies, but there is still an enormous untapped potential, Watkins said.
"The challenge for many companies is to become bigger," he said.
Watkins said he learned much from observing how MedImmune of Gaithersburg grew to become the state's largest biotech under then-CEO David M. Mott. Mott, the Gazette's Executive of the Year for 2007, is now general partner of venture capital firm New Enterprise Associates, which has offices in Chevy Chase, Baltimore and other cities.
Watkins described his managerial style as hands-on, but he allows scientific experts and others a good deal of leeway in making decisions. He gets out of his office and even dons a lab coat to observe the scientific process.
"I don't stick my nose into decisions I'm not equipped to make. We have senior managers who have been together a long time and key people who are experienced. We have excellent scientists here," Watkins said. "It's a very participatory environment. There are not a lot of edicts. ... Still, decisions don't rest entirely with these individuals."
Jerry Parrott, vice president for corporate communications and public policy, said HGS is the "most collegial place" that he has worked.
The company's board is very experienced, professional and hard-working, Watkins said. In turn, Chairman Argeris N. Karabelas, a partner with Princeton, N.J., investment company Care Capital, praised Watkins as an outstanding leader.
"He has weathered difficult challenges and, together with his team, has achieved remarkable, value-added milestones," Karabelas said. "We are not quite where I know Mr. Watkins wants to be, so there should be considerably more to report in the future."
A Bethesda resident, Watkins said he likes to visit cultural institutions, such as the National Symphony Orchestra and Smithsonian museums, and sporting events, with his wife, Wendy. They have three grown children, including one in college.
Looking ahead, Watkins noted that the HGS campus has room to grow, with one wing largely unoccupied that he believes will fill up in the near future.
"We have a chance to help a lot of patients," Watkins said. "At the end of the day, that is what it is about."
H. Thomas Watkins
Position: CEO, Human Genome Sciences, Rockville, since late 2004; president since late 2005.
Career: President, TAP Pharmaceutical Products, jointly owned by Abbott Laboratories and Takeda Pharmaceutical 1998-2004; AbbottLaboratories, 1985-2004, positions included president, Abbott Laboratories, Japanese subsidiary; management consultant, McKinsey and Co., 1979-85; Arthur Andersen & Co., 1974-77.
Community and professional activities: Chairman, Maryland Life Sciences Advisory Board; trustee, College of William and Mary Foundation; trustee, Mason School of Business, College of William and Mary; board member, Vanda Pharmaceuticals; board member, Biotechnology Industry Organization; board member, U.S. Chamber of Commerce; board member, National Symphony Orchestra.
Education: Bachelor's in accounting, College of William and Mary; master's in business administration, University of Chicago Graduate School of Business.
Family: Wife, Wendy; three children.
Age: 57.
Residence: Bethesda.
Previous Gazette Executives of the Year
A panel of Business Gazette editors and executives selected H. Thomas Watkins, CEO and president of Human Genome Sciences in Rockville, as Executive of the Year for 2009 based on factors such as business success and commitment to community service.
Previous winners:
2008: Elizabeth "Betty" Buck, president of Buck Distributing.
2007: David M. Mott, president and CEO, MedImmune.
2006: Carol Trawick, president and CEO, Trawick & Associates.
2005: Jaye S. Gamble, regional senior vice president, Comcast.
2004: James Soltesz, president and CEO, Loiederman Soltesz Associates.
2003: Gary Murray Sr., CEO, Human Vision.
2002: Jack Fitzgerald, founder and owner, Fitzgerald Auto Malls.
2001: Mary Frances leMat, president and CEO, Social & Scientific Systems.
2000: Hunter R. Hollar, president and CEO, Sandy Spring Bank.
1999: John Hendricks, chairman and CEO, Discovery Communications.
1998: Laura Henderson, Prospect Associates.
1997: Cliff Kendall, Computer Data Systems.
Copyright © Post-Newsweek Media, Inc./Gazette.Net