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In this back-to-school season, serial entrepreneur John Holaday is an appropriate businessman to study.
A longtime biotechnology guru for Montgomery County and the state as an official with the Tech Council of Maryland and founder of bioscience companies including Rockville's EntreMed and other businesses, Holaday says, "What I really am is a teacher. I think that conveys everything. Teachers have the art of selling things and if they are good, they can take complex ideas and make them easily understood."
While he lives in Bethesda and is a director of several Maryland companies, he regularly travels to North Sydney, Australia, the home of QRx Pharma Ltd., for which Holaday is managing director and CEO, and to Bedminster, N.J., site of the company's U.S. subsidiary. Then he may be in Germantown at a board meeting for biotech Xceleron or visiting Accelovance or CytImmune in Rockville, other companies he helps guide, or elsewhere in the country or abroad.
And, Holaday, who grew up in New York, Tennessee and Alabama, and served as an Army captain, says, "I give a lot of lectures in a lot of places." He spoke Thursday on rural health, the state of health care and how drugs are developed, in a program at the University of Alabama in Tuscaloosa.
What did you think of Gov. O'Malley's bioscience plan?
Any money devoted to the cause of our life sciences industry is well appreciated. It's been sorely needed for some time. Although our state has made claims to be a mecca of biotech, I think in many ways there's been more claim than there's been substance.
We haven't followed suit, or even led the way as would be expected of a state like Maryland of putting the resources to work, in our life sciences industry. [There have been] lots of deals that can be proudly mentioned … by various [economic development agencies], etc., but the end result is we haven't put, until this point in time, the millions and billions of dollars in, like North Carolina, like California and even smaller states like Alabama and others, that want to have a piece of this biotech pie.
So, any move is good one. Certainly I think it needs to be wisely distributed and I think it should be also emphasized that as it is done there needs to be a clear peer review process so that it's not just done on a political basis by either geography or by other influences that wouldn't allow it to have its dissemination to the greatest good of the industry or the state.
After O'Malley's plan was announced, there was some feeling that the plan will overlook Montgomery County in favor of building up biotech elsewhere, like Baltimore. What do you think?
Well, politics is politics. … Certainly we've got two-thirds of the life sciences companies in the entire state located in Montgomery County. There perhaps is a tendency to think we're doing just fine because of that volume and the successes of some small handful of companies in our area. And perhaps it is a goal of this plan to make it more Baltimore-centric. Clearly those of us that are devout Marylanders want the entire state to succeed.
But those of us who are also more local in terms of our environment would rather have a reasonable proportion of those funds fund reasonable science development here in Montgomery County. You don't want to put good money in places where there's little experience.
I think the total lesson of what we learn here is if this money is spent with small amounts to large numbers of companies it's not going to be a successful plan. It has to be administered to those companies that have a likelihood of making a difference in selling products. And the ones that are more likely to achieve that status are the more mature ones and within the state of Maryland, those are mostly in Montgomery County.
Of the companies you're still involved in here in Maryland, which one is going to be biggest newsmaker next?
Well, it depends on what kind of news you want. They are all so different in what they do, their business plans and their opportunities.
I'm very proud with Jack [John P. Hollerbach [president and CEO] to have built HarVest Bank [of Maryland], now with $200 million [in assets] in less than four years … and has positioned itself well under his leadership not to have been caught in the recent banking problems but instead to have grown throughout that process and met the needs of our community. Maxcyte … [of Rockville, which develops targeted drugs and delivery systems], I started that company, and it is still here, and doing well.
Xceleron, the company I was just visiting [in August], can make a huge difference in the way drugs are developed. … Can you imagine being able to do studies in people before you do them in mice? And to answer some of the fundamental questions in how drugs are absorbed in human beings, and save 12 to 18 months in the drug development process, because the dose that you use is so low …
You've heard of nanomedicine, which is what CytImmune [CytImmune Sciences Inc.] is about … with this sensitive assay system they've got, it's almost on an atom-by-atom basis one can analyze the presence of drugs in various biologic fluids. Or I should say molecule by molecule.
So that's a fascinating company. It's one that I brought to Montgomery County. It's got a facility here as the base for its U.S. operations and it's growing quite rapidly in terms of employment as well as its business opportunity. They have found a way to put toxic drugs that treat cancers into "Federal Express" envelopes that know where to go when they are mailed … get there, release their contents and kill tumors — unlike a lot of those chemotherapies, which when given generally have the adverse effect all over the body and also may help tumors. What they do with these nano-particles of gold is to send the message directly to the tumor where the toxin is released and decrease tumor growth and size.
Accelovance is run by, in my opinion, one of the smartest businessmen I've ever met, and certainly one of the best entrepreneurs and that's Steve Trevisan. Previously, he's taken four companies from a few hundred thousand dollars of investment through to $25 [million], $50 million in value — most recently TherImmune, which he sold to Gene Logic about four or five years ago, for north of $50 million.
Accelovance is a clinical or contract research organization. Most pharmaceutical companies are decreasing their own internal capacity for clinical drug development and hiring CROs now. It's a very rapidly growing field. Steve knows how it's done. He's a pioneer in the field. He was the first to use radio and TV ads to recruit patients for clinical trial studies. Accelovance is using a lot of his pioneering technologies and certainly his 20-plus years' experience, and a footprint here and in China, to provide pharma companies with more patients faster that comply more closely to protocols and give better data earlier.
Which of these is further advanced as far as earnings?
Only one that is not is CytImmune. All the others are certainly earning dollars. Our bank is profitable. Xceleron is profitable and Accelovance is profitable. So they all have the magic word "revenues" associated with them … and in the life sciences industry that's kind of a rare thing these days.
CytImmune — what is the prognosis of their products?
I think they've got an enormous opportunity to make a difference. Were I ever to develop cancer, that's one of the first things I'd try to seek out if it were available. I like the concept, the data look very, very good to date. They're looking to increase [their] capital structure so they can expand their already promising clinical trials. I would imagine you could say that's the case of most of the life sciences companies. I'd bet that two-thirds of the life sciences companies in Montgomery County and the state of Maryland have less than a year of cash to survive in the bank.
This is a nuclear winter for funding life sciences companies … worse than it was in '02, which killed a lot of very good companies. It is indeed a challenging time for our local companies that have breakthrough products that will help patients, employ great people, but have insufficient resources to achieve their goals. Seeking financial support in this environment is like preaching to a deaf congregation. Clearly, finding survival mechanisms for our local entrepreneurs is going to be critical for them to ultimately get their products on the market.
Explain a little what QRx Pharma is all about. They recently got Food and Drug Administration approval for clinical trial plans?
Yes, QRx Pharma is my day job, that's my passion and it's doing extremely well.
On the FDA review, this is a significant and positive outcome. The acceptance of QRxPharma's streamlined development plan for Q8003IR [a compound for pain management treatment, which completed its first phase 3 clinical trial in April], is a measure of success in terms of reduced risk, resource efficiencies and potential value of dual opioids [a fixed-ratio morphine and oxycodone combination product]. This is a $7 billion market in the U.S. alone, and there is an enormous need for pain relief with few limiting side effects.
I've been working with a lot of Australian companies over the years. Queensland has been a state always known for mining and agriculture. They elected a premier there 12 years ago who said this is a state with a lot of intellectual power, let's see if we can become a technology state as well.
So in order to achieve that, he put together an infrastructure to build technology and then commercialize it and he asked me to join back when I was head of the Maryland BioAlliance [part of the Tech Council of Maryland] to see if we could find like efforts and grow business relationships. I met the guys involved with QRxPharma and became very interested in their technology. I worked as a consultant for them, and then as things evolved I took the helm of the company and took it public in Australia a year ago and have since been doing the clinical trials.
How many employees?
A total of 12 … three in Australia and nine in New Jersey. And me here. We're a very virtual company, because what we do, we're taking a mature product and then developing that through the clinical trials. So we're not white coats and mice and laboratory benches. We're taking something that's already been through that process and taking it into the clinic for commercialization. So we're a late-stage company. And most of the people that do that are located in New Jersey, because they all have come out of big pharma.
One of the problems that we face in Montgomery County and the state of Maryland is we don't have a lot of people that can develop drugs like that. They can invent them but they don't know how to market them. So only one or two companies really sell things.
Is QRx Pharma making money?
No, we're spending money. Our burn rate is pretty modest, just a few hundred thousand per month. We've now got over $30 million in the bank in Australia and we are in the middle of phase 3 studies and for pharmaceuticals that's really a momentous time. Because that means we're only about two years away from launching a product and selling it.
No one else is doing this dual opioid strategy?
No one else is … and they can't because we've got the intellectual property, so it's well-patented. And the beauty of this, to me, is because when I did my training out at the University of California in San Francisco 35 years ago, I was one of the early researchers in the endorphins, the body's own natural opiate. So in doing that work I worked in the opiate field, so this is a return for me to a field where I've published hundreds of papers. And for me it's both scientifically satisfying as well as it is developing a business that makes a difference.
What makes this special is for 200 years people have sought a better version of morphine, with limited side effects. Over the years, hundreds, thousands of drugs have been made and launched with the hope they would have fewer side effects, with the same pain relief. So what we have done is put morphine together with oxycodone, and you get synergy without side effects.
Any other irons in the fire?
No … not really consulting in any way other than serving on the boards of directors of the companies we talked about earlier. A lot of of folks ask me a lot of things a lot of times and I'm very good to give free advice … but you get what you pay for. [Laughs].
John Holaday
Age: 63.
Position: Managing director and CEO, QRx Pharma Ltd., a specialty pharmaceutical company in North Sydney, Australia; director, Xceleron of Germantown, and Accelovance, CytImmune Sciences and HarVest Bank of Maryland, all of Rockville; associate professor of anesthesiology and critical care medicine, and senior lecturer in medicine, Johns Hopkins University of Medicine; adjunct professor of psychiatry, Uniformed Services University School of Medicine, Bethesda.
Education: Bachelor's and master's degrees in biology, University of Alabama; doctorate in pharmacology, University of California, San Francisco.
Organizations: Leadership Board for the College of Arts and Sciences, University of Alabama; board of directors, University of Maryland Biotechnology Institute; Judges Panel for the Ernst and Young Entrepreneur of the Year award, 2003 to present.
Awards: Ernst and Young Entrepreneur of the Year Hall of Fame, 2006; Algernon Sydney Sullivan Award, University of Alabama, 2008.
Publications: More than 200 scientific articles and reviews, edited five books.
Residence: Bethesda.
Family: Wife, Dori; children, Sean, 14, and Jackson, 12.
Hobbies: Running, tennis, skiing, horseback riding, golf.
