Russ: Hi, I’m Russ Capper and this is The HealthMakers Show. My guest today, Christian Tidona, Founder and Managing Director of BioMed X Innovation Center in Heidelberg, Germany. Christian, welcome to The HealthMakers.

Christian: Thanks for having me, Russ.

Russ:  You bet. Tell us about BioMed X Innovation Center.

Christian: BioMed X Innovation Center is a place to which we attract the world’s best academic research talent to work on projects for the pharmaceutical industry.

Russ: And how do you do that?

Christian: It’s a completely new approach which is based on crowdsourcing. So, we tap into the global brain power in academia and we do it in a way that we post the toughest research problems of our pharma partners worldwide at the best universities and research institutions. We invite young scientists to apply by submitting a very original project proposal of how to solve the problem. Then, we select the fifteen best ones, we invite them for a five-day boot camp to Heidelberg, and then the winner of this boot camp is then relocated to our center in Heidelberg to work for four years on such a project.

Russ: The pharma companies, that partnership with you is very important, it’s critical to success?

Christian: Yes, it’s our customers.

Russ: And do you have all the big ones?

Christian: Yes. We have seven different pharma deals so far. Companies like: Roche, the German Merck, Boehringer Ingelheim, Janssen, Johnson & Johnson, and AbbVie.

Russ: Do the young scientists that apply, do they know that they’re applying and could win as much as they can win?

Christian: Yes, that’s what we put in our call, and that’s why we get between 300 and 600 proposals for each call, from 70 to 80 different countries.

Russ: My goodness. So, contrast that to what I would call a pharma accelerator program here in the US.

Christian: Accelerators are mostly focused on a generation of startups, and what we’re doing is we’re tapping into this global academic brain power. We’re looking for academic scientists and how to mobilize their knowledge, their creativity for new medicines for the pharmaceutical industry. In the end, we’re producing intellectual property on which new medicines will be based, and we’re helping those talents to grow and to get a new job. Most of them that have ended up, of the projects that have finished, they actually took jobs in the pharma industry.

Russ: Real interesting. So, it’s not like they won and they got paid a million Euros, is what you said?

Christian: Well, they get the budget to work with. They have normal salaries, like in academia, but they have this research budget of, on average, four million dollars per project, for four years.

Russ: For four years, ok. When they’re working on it they know that they’re just sort of demonstrating their capabilities to these pharma companies, hoping that something big can come of that.

Christian: Right. The problems are always very specific, and these problems are defined in innovation workshops, which we are doing at the pharma companies, to help them to ask the right questions. Those questions are always very challenging. These are problems for which the pharma companies have no idea how to solve. Through this crowdsourcing approach, we are generating those ideas that are then the basis for truly disruptive innovation.

Russ: Give us an example of one of the challenges.

Christian: One example is, let me put this one, Johnson & Johnson. You know Listerine, the mouthwash?

Russ: Yes.

Christian: Listerine is very effective in killing bacteria in your mouth, but what remains is the biofilm. So, you still need to brush your teeth. The challenge was, what needs to be put into Listerine that you don’t need a toothbrush anymore? This is a very tough problem, and what would you do as a big company? You would put in chemicals that try to get rid of the biofilm. Those chemicals are also irritating the mucosa, which is not good. The group that actually won is a group, an Indian fellow, Balendu Avvaru, who came up with the idea to reprogram the mouth bacteria so that they destroy their own biofilm, and they’re very successful.

Russ: Share with us, I mean, how long have you been doing this now?

Christian: Four and a half years. We started in August 2013, and so far, we have twelve groups on board. The thirteenth call is just published.

Russ: Some of them have completed the process.

Christian: Right. Three of them are finished.

Russ:  And how did the winners do there?

Christian: First of all, what I found very surprising is, I would have thought that half of them go back to academia because they publish at my center, and half of them would go to industry. Except two people, every one of the first three groups got very good positions in industry.

Russ: So, it’s your operation and it’s not a non-profit, I would assume. How do you make money?

Christian: The business model works that way. Projects have this price tag of around four million per project. This is to finance the groups and to run the Innovation Center. At the end of the project, the sponsoring pharma companies can freely decide whether they want to acquire all the intellectual property that came out of their project by paying a pre-negotiated, we call it, exit fee.

Russ: Pre-negotiated with you?

Christian: Yes, with the center, and it’s in the framework agreement. If they take the intellectual property they have to pay this exit fee. If they don’t pay the exit fee, the intellectual property stays with our center and we can do something else with it.

Russ: Today I would assume you’re sitting on some pretty cool intellectual property?

Christian: On one hand, yes. Also, we have used some of those profits from the exit fees to start developing our own drug discovery pipeline, which then will generate the next level of profitability.

Russ: So, why Heidelberg?

Christian: Heidelberg is, not many people know this, but Heidelberg is one of the biggest biomedical innovation hubs in Europe. A very large campus of the University of Heidelberg, more than 15,000 people and more than 20 different institutes on one campus, plus 16,000 students. It’s a very dense biomedical research environment, and this is what helps us to attract the world’s best talent; from Stanford; from Singapore, the National University of Singapore; from all those big hubs; Boston. It’s these academic talents, they need vibrant academic environment with lots of institutions, core facilities, student life. That’s what they want.

Russ: There’s the boot camp part, but after that, if you’re successful you become into the general operation of the whole place, the whole center, right?

Christian: Yes. We give them an offer to become an employee of the BioMed X Innovation Center. We relocate them from wherever they are to live for four years with their families in Heidelberg. They live and work in this open innovation atmosphere.

Russ: To get to that, you had to be the winner of the boot camp?

Christian: Yes. You need to win the boot camp, which is very intense. We don’t let people sleep, and they are completely pushed out of their comfort zone to come up with truly a novelty of ideas in something we would call a fully-fetched project proposal.

Russ: Ok, don’t let them sleep.

Christian: We don’t let them sleep for four nights.

Russ: It sounds like SEAL training or something like that.

Christian: This is very similar. The reason why we’re doing this is, first of all, we want to select a good group leader. A good group leader means someone who is not just scientifically brilliant, we don’t want brilliant jerks, but someone who is helping others or really being able to lead a team. If you are a jerk, you can pretend to be a good leader for two days, maybe, but not having slept for four nights, if you’re a jerk it will come out.

Russ: Do they know coming in that’s the way boot camp is going to go?

Christian: Nope; no idea. They have no idea. And actually, we have half a day to impress them. They are coming with 10 top publications. So, the first day when they are on stage, they think they’re the best of all. Then, they see everybody else is about the same level, and then they find out that their project proposal was not even close to what we expect. In order to get these guys to invest four nights without sleep into a new project proposal, you need to really work on that.

Russ: Do you have dropouts?

Christian: Yes. It happens every two or three boot camps that somebody starts crying and goes back home. It’s really tough, it’s a tough experience.

Russ: Do you have any successes to tell us about?

Christian: We have completed three out of the twelve projects we have done so far. A project is successful for us if the pharma company decides to internalize the intellectual property which we have generated, and then use that to develop a new medicine. Out of the three projects, this has happened in two cases. So, two-thirds a success, which is, in biomedicine, pretty good.

Russ: Christian, thank you so much for sharing your fascinating model with us.

Christian: Thank you very much, Russ.

Russ: You bet. And that wraps up my discussion with Christian Tidona, the Founder and Managing Director of BioMed X Innovation Center. And this is The HealthMakers Show.