Ajit Nagral – Growing and divesting businesses in the life sciences and pharmaceutical industries?

Do you start a business with the intention to divest, or is this something that becomes clear as the business grows?

I find building a company from the ground up very exciting, so that is always a leading factor behind starting a new business. Divesting is never the intention when building a business, it is more something that becomes clear over time. The motivation behind starting my businesses is to create value and deliver a meaningful impact into the pharmaceutical and life science space, in whatever shape that may take.

Take Sciformix, for example. As with my other businesses, Sciformix was created in the right place at the right time, offering our ability to combine science and process at a time when other outsourced businesses were only offering one or the other. When creating Sciformix, the intention was not to divest at a later stage, but to deliver value in what was, at the time, a new area in science.

CROs and regulatory consultants had been around for a long time when I founded Sciformix, but pharmacovigilance (PV) was a relatively new area in the industry. As regulations tightened on the reporting of adverse events within clinical trials, the pharmaceutical industry sprang into action, and it soon became clear that the new pharmacovigilance processes were too much, and too lengthy to all be completed in-house within the 15-day deadline for reporting serious reactions. These regulations were very new when we built Sciformix, and as a result we grew very quickly and worked through roughly one and a half million cases per year. When the time was right to divest, Sciformix was acquired by Covance, and it was time to move on to the next venture (Scitara).

How do you know when it is time to divest and move onto your next project?

When you are working on your business, there is not a conscious decision to divest. You know when the time has come to move on – it is like you flip a switch and realise it is time for something new, and you begin to ask yourself “why would I sell?”

Timing is critical when considering divesting. Is it the right time for your customers? Is it the right time for your employees? And is it the right time for your investors? If it is the right time for all three of these areas, then you can begin the transition fairly quickly. However, if only one or two of these areas are ready for this change, you need to step back and ask yourself “how can I make it the right time for all three?”. Thankfully, all of my exits have been at a point where the time has been right for all three parties, so I have left my businesses smoothly and on good terms.

Does divesting affect the company’s customer base, or is there a smooth transition?

Interestingly, a lot of our customers often prefer to work with smaller companies, such as those which I founded, over larger companies who offer similar services. The benefit of smaller outsourced companies – well, small in comparison to the customer – is that the culture is quite different. Smaller companies and agencies can offer a level of flexibility and innovation to customers that can be difficult to pass through larger organisations. In addition, there is a real sense of an “I have your back” attitude, as you are able to work closely with your customers. Culturally and contractually, my companies have been able to offer something different to larger companies, and we have been willing to do anything and everything our customers needed, which is why they would often choose to sign up with us.

However, as the business grows, those customers tend to stay. When customers become a part of your journey, your relationship with them evolves and your company becomes better equipped to protect their business. Because I aim to divest at a time when my customers are ready for it, there is generally a smooth transition.

You mentioned in our last blog that Scitara was your ‘finale’ – what do you mean by this?

As my previous three ventures were in tech, services, and global delivery, Scitara is the summation of all of my previous projects. As I mentioned in the last blog, Scitara aims to solve the major problem within the lab industry of data connectivity and is leading the digital revolution in labs to address this issue. To do this, we will require the cooperation of every connection we have made over the years, as by helping us, we can help them. If we can reach out to everyone in the ecosystem, we will be able to help companies take a huge leap into their digital transformation projects by creating a platform through which they can communicate their lab data through their digital systems, something which at present is proving a real hindrance to digital transformation projects.

This is why I believe Scitara is my finale. It is almost as if we have come full circle, as Scitara pulls together the skills and relationships I have built over my entire career – into creating a final solution. I intend to go out with a bang!

Industry leader interviews – Oscar Kox?

Oscar, please introduce yourself

I am Oscar Kox, and I am an analytical chemist by training. After I graduated I worked in a laboratory, but with my energy levels I knew I wanted a change of setting. I did not want to discard all my hard work and studies, so I started working for Thermo LabSystems, where I started my sales role with LIMS. It seemed I was pretty good at this: – I understood the software, I understood the customer, I understood the lab process and the demos went well.

After 8 years at Thermo, I moved to London to work for R&D software and solutions company, IDBS. My focus at IDBS was ELN systems, and I stayed there for five years: I had accounts mainly in Europe but also a couple of global accounts.

In 2010, I set up my own lab automation company called iVention. We set iVention up with just two employees, using our own finance and have grown the company organically. 

What made you decide to set up a business from the ground up in a market with established competitors?

We set out to create an automated upgrade platform for LIMS/LES/ELN/(S)DMS, which supports all functional areas within a single technology platform.

I know the competitors in the market well and I have a lot of respect for them, they do good implementations, but I feel there is a lack of innovation. If you look at Salesforce, or Tesla, or Microsoft 365, the system is being updated constantly at no additional cost. Why should lab automation instrumentation be any different? That is the reason I set up iVention – we are trying to change the model.

How is iVention’s approach different in terms of the technology and the business model?

Customers in the market do not look for only LIMS or only ELN anymore – they want an integrated system, a Platform. The iVention vision was to create a lab execution system within a single platform to supply all functionality requirements with no need for modules or extra payments on upgrades. Our platform allows customers to use the LIMS entity in the ELN and visa versa, giving the ability to mix up structured and unstructured data, and do everything in one platform. We like to compare it with Lego; we use functional building blocks that work seamlessly together as one.

How does iVention approach product development?

In terms of product development, we are agile. This means we cut everything down into small pieces and deliver quicker releases. This enables us to ship releases every two weeks (which is more manageable than bigger updates every six months or annually) and therefore mitigates risk. Agile implementations mean we do a very simple implementation, go live and then work from there to enhance the functionality and configuration. The simpler the system is to go live, the easier it is accepted.

While customers do not make initial decisions to buy based on long-term service, we invest strongly into support for our customers, with automation and upgrades as part of their contract. For example, we have automated OQ scripts, which we feel really is the pot of gold at the end of the rainbow because the whole process is automated.  

Is iVention today what you expected to build ten years’ ago? Are you where you expected to be?

I am now not only responsible for sales but for services, support, the development team, management of capacity, and so on. I love the responsibility.

I thought the pickup would have been at a higher pace, but we are in a very conservative industry. I quickly realised the importance of having people on the ground, so we are strong in Europe especially in DACH countries (Germany, Austria, Switzerland), in North America and in India thanks to the teams we have built.

There is one mission statement I came up with when we started up in 2010 – happy customers. That is really big for me, and I am immensely proud that we have not had a single customer loss in 10 years!

Who is your customer base and what is your global footprint?

A large portion of our target audience works in a regulated environment, in pharma, and there are also some big food and beverage companies that we work with. We also now have a growing footprint in the water industry, as there is a strong regulatory demand for sample management.

It is always good to have first mover customers in a market, so they can see your solution and talk about it to others in the market. Again, this is a conservative industry – people buy from people.

Our growth has been sustained by global partnerships, including Microsoft, LabTwin, Dextr and Perkin Elmer. We plan to grow our global footprint in the coming years, as people on the ground allows us to penetrate local markets and clients. We currently have a total of 75 people working for iVention, and very good global coverage. Our headquarters is in the Netherlands, where I am based. We have regional footprints all over the world, including an office in India, where our Global Configurations Manager is based.

However, the biggest growth area for us currently is DACH supported by our regional office in Switzerland. Next year we plan to triple our revenue across the DACH area. Our growth comes from wider knowledge and acceptance of our technology, for example, in the last three weeks we have signed up over 300 new users. We invest strongly in people in each region to support our growing customer base.

How has COVID-19 impacted you and your customers in 2020?

Since late February, all our consultants across the globe have worked remotely and have moved all ongoing projects online. As you can imagine, it has been a huge relief to our customers that we have been able to continue with projects despite the stringent travel restrictions and challenging circumstances.

We have adapted well to COVID, and these times have actually helped us to showcase the full capabilities, power and strength of our product.  We support all our implementations online, which has proved the power of the platform and the SAAS cloud technology. We can work from anywhere.

What makes iVention a success and what do you feel makes you a successful entrepreneur?

We started the company with no Venture Capital, so we are completely private, there is no external money in the company. We have built this company with decency, knowledge and with a strategy.

I think it helps that I had a reason for starting iVention. I still work as hard because I want to change this industry by highlighting it is about staying ahead of the game and constant innovation. People like to drive a Tesla; many people purchase them for the environment, but a lot of people do because it is simply great technology!

I see iVention as a family business – we go on skiing holidays with the whole team every year and do regular outings. During COVID it has been difficult and we all really miss that interaction. I miss my team! I like to make people successful in their roles, but also make iVention successful with the ambitions that we have.

The evolution of pharmacovigilance?

Jamie, please tell us a bit about yourself and your background 

My name is Jamie Portnoff, and I am the founder and principal consultant at JMP Consulting. JMP Consulting assists clients in the pharmaceutical industry to achieve and sustain compliance and improve overall performance in pharmacovigilance (PV) and related functions like quality, medical information and regulatory affairs. Before founding JMP Consulting, I worked in the pharmaceutical industry. Not many management consultants working in PV have hands-on, real-world PV experience; this experience means I understand the realities of day-to-day work in and around PV, and how challenging it can be to deliver against requirements and expectations.  In my earliest days in industry, I especially enjoyed working with people and on projects, and I soon realised that I wanted to marry up my problem solving and analytical skills with my practical industry knowledge, and after a few years of working with big consultancy companies I decided to start JMP Consulting.

Big changes are coming in PV, but before we look at the future, we need to understand the past

Let us look at the last three decades.

In the 1990’s there were basic PV safety database systems, such as ArisG, ArisLite and ClinTrace. Fax machines were a huge part of the tech that enabled PV processes, with a high volume of incoming and outgoing data by fax. Processes were extremely paper-intensive and were designed to accommodate transactional work, such as processing of cases and putting aggregate reports together; everything was very compliance-focused. Consequently, there was demand for full-time roles dedicated to paper management, typing up documents and data entry. Teams were typically regionalized, and everything was done “onshore”.

In the 2000’s, PV technology became more sophisticated, more globally oriented. There were advances in what the technology could do, and consolidation of major tech players due to M&A activity. Paper-based processes began to give way to more digitization and electronic workflow management. Analytics tools become more prevalent and more user-friendly.  However, a typical PV department was still very paper-intensive. Some of the regionalized models began to consolidate to one system, one process, and one organization, particularly between US and Europe. 

Throughout this decade, more stringent regulatory requirements were continually being introduced, such as the Risk Evaluation and Mitigation Strategy (REMS), as well as Volume 9a. Consequently the bar was being raised for the calibre of work, and quality management expectations were increasing. We saw more focused teams dedicated to signal detection and risk management, and specialized teams emerged to manage increasing business system needs as the regulatory requirements led to increasingly complex systems. Dedicated vendor oversight teams were also required as companies began to work offshore with vendors.

Over the last decade, good pharmacovigilance practices (GVP) were introduced in the European Union (EU). The Qualified Person for Pharmacovigilance (QPPV) is not a new requirement, but it became clear that this person needs a whole team around them to support them and help shoulder the workload.

Offshore work has grown in magnitude, partnerships between companies have become an integral part of how business is done, and next generation technology is rolling out to improve efficiency and consistency. Safety systems have become truly global, enabling a scalable end-to-end safety process within a single system.

Figure: Illustrated examples of the way the world of PV has evolved.

What will happen with the advent of next-generation technology?

Big changes are coming with PV technology, which will drive major shiftsin the way we think about how PV work gets done. We have seen evolution in PV technology before, but it seems this time around will be more impactful than anything from the past 20 years.

With the advent of next-generation technology, new hard skills will be required, such as understanding of machine learning, natural language processing and artificial intelligence. Organizations need to be able to manage transformation of the PV business effectively and regularly, and leverage advanced analytical tools to derive meaningful insights from various data sets. Additional ‘soft’ skills will also be needed, such as adaptability, flexibility, open-mindedness as well as the ability to ‘think outside the box’ to drive improvements through innovative thinking.

New roles within the organisation will emerge, with specific roles dedicated to:

Meanwhile, other roles will fade out and teams of people (in-house or outsourced) performing transactional activities will become a thing of the past.

What does it mean to be future-ready in pharmacovigilance?

From a process perspective – Processes must be highly scalable to accommodate growth in volume and complexity, and a blend of proven and cutting-edge technology is needed to support and enable this. A future-ready process has metrics to enable continuous improvement; it can efficiently evolve and adapt to simultaneously accommodate new regulations, innovative products and evolving stakeholder expectations.

From a technology perspective – Highly agile, flexible and robust, technology needs to be business-led with strong IS support and should be woven into an organisation’s processes, not vice versa.

From a people perspective – People in the organisation must accept increasing automation of processes – you can have the best technology in the world, but if the people in the team are rejecting it, it is not going to be successful. Well-managed resource models are also hugely important.  The organisational structure must be designed around the business’ needs, not vice versa. Employees should offer more than one skillset and in return, they must have a pathway to develop professionally. It is critical that a team can approach things from different angles and can adapt to change – these days excelling in just one area is often not enough.

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