Pharm Exec's 2013 Emerging Pharma Leaders - Pharmaceutical Executive


Pharm Exec's 2013 Emerging Pharma Leaders

Pharmaceutical Executive

Top Grade in Generics — Jeff George, Sandoz

Jeff George, Global Head, Sandoz
In today's generics business, there is no sense of entitlement—profit margins are middling, product timing is defiantly of the moment, and every last inch of commercial turf is contested. For Sandoz' Global Head Jeff George, the appropriate response to all this market mayhem is to invest each of his waking moments with a sense of urgency. "The first asset required of a leader in the generics business today is: you've got to have drive." Precisely because the barriers to entry in generics are so low, he says, maintaining a competitive edge often depends on distinctive individual character traits like energy, passion, analytical clarity, and that sheer will to win.

At age 39, George occupies a pivotal role in the industry, leading a high-profile business with nearly $9 billion in annual turnover and a workforce of approximately 26,000 people located in over 140 countries. Sandoz, a division of Novartis, ranks a close second to global leader Teva in annual sales of generics. The business has a large footprint. Sandoz manages an inventory of some 25,000 SKUs with an annual production volume of 49 billion tablets and injectables manufactured at 45 different sites in 17 countries; some of this activity is conducted in cooperation with external partners, of which there are more than 200. Six percent of the world's population—420 million people—was given a Sandoz medicine last year and the company is now closing in on serving 500 million patients.

The position he holds within Novartis is commensurate to the responsibility. George is the youngest member of the Novartis Group's Executive Committee and reports directly to Novartis CEO Joe Jimenez. George considers both Jimenez and incoming Novartis Chairman Joerg Reinhardt as key mentors, as Reinhardt was instrumental in recruiting George to Novartis in January 2007 to head the Western and Eastern European vaccines business. More recently, Jimenez and former Chairman and CEO Dan Vasella have been major influences, as George worked for Jimenez first at Novartis Pharma and then assumed the larger role at Sandoz.

Family background and a diversity of positions in his early career helped smooth George's transition to the "c suite." His father, Bill George, led the device manufacturer Medtronics for many years. George obtained a Harvard MBA and then took his first post as a consultant at McKinsey & Company, which led to assignments in the retail consumer business, ending up as head of strategy and business development for a division of Gap Inc., where he was instrumental in building the Banana Republic brand.

This retail background did more to prepare him for his current role in pharmaceuticals than might commonly be assumed. "My experience allowed me to see that a key sweet spot for the pharmaceutical industry lies at the nexus between healthcare and retail. Healthcare today is an increasingly consumer-driven business, one in which pharmaceuticals are required to demonstrate value to many stakeholders beyond the physician. Understanding retailing is helpful to make the case for medicines in an environment where patients and payers have real choices." George notes that he applies the lessons he learned from retail by constantly underscoring Sandoz' association with and commitment to quality. "I've made it clear to everyone that we live or die on this—it's central to our business mission and reputation."

Since assuming the top job at Sandoz in October 2008, George has pursued a strategy to grow and transform the generics business through innovation—in products, process, technologies, and people. "It may seem counter-intuitive, but the generics business today is where new ideas on how to create operational efficiencies, expand patient access and market cost-effective product solutions for payers are all coming together," George says. He notes that the generic business itself is consolidating to become more competitive in global markets. "In 2000, the top four generics companies together had only a 13 percent market share; today, it's approaching 30 percent. So you have to innovate to survive."

Under his leadership, Sandoz has built on its historic base in INN generics to establish an unrivaled position in complex, differentiated generics that carry a heavy dose of science, often developed in cooperation with the patented, R&D side of the Novartis business. These differentiated generics provide that coveted "blue ocean" space—where Sandoz can stand alone, ahead of the competition—by requiring more costly science and extra regulatory hurdles, or by being hard to manufacture.

Biosimilars, injectables, and specialty drugs like ophthalmics and dermatologics now account for roughly 45 percent of Sandoz's sales, up from 30 percent when George came on board in 2008. Sandoz has captured the number one global sales position in each of these categories, supplementing organic growth with a targeted acquisition strategy, where Sandoz has bought leading-edge companies in dermatology (Fougera, in 2012), injectable oncologics (EBEWE Pharma, in 2009), and respiratory care (Oriel Therapeutics, 2010).

Sandoz has notched a particularly strong performance in biosimilars. The company began prepping for a stake in this area way back in 1996 and was the first big industry player to introduce a biosimilar, launching its version of Pfizer's Genotropin in Europe in 2006. Partly because of that foresight, Sandoz over the last five years has quintupled sales in this segment to secure a 50 percent share of the regulated worldwide market.

Another element in George's innovation agenda is making Sandoz a leader in access to medicine among underserved populations in the developing world. "The cost benefit ratio from use of quality generics is second to none, and our price points bring the Sandoz product line in reach of 90 percent of the world's population." Specifically, he sees long-term commercial potential for the company in Africa, where Sandoz is testing out new, needs-relevant approaches to drug distribution and patient education. There is an element of altruism here that is unusual for a generic company, but George stresses that every access initiative pursued by Sandoz is designed ultimately to be profitable, in keeping with the parent company philosophy that only those programs that can pay their own way will remain sustainable in the face of economic downturns or management changes.

"I made three trips to Africa last year and will go again at least twice this year. All the factors for success are there, including a growing, youthful population; expanding investment and strong GDP performance; and huge unmet medical need, particularly for high quality, affordable drugs. I'm convinced governments, providers, and patients will remember who pioneered in investing in sub-Saharan Africa's health infrastructure—I want that company to be Novartis."


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