What Bill Gates Says About Drug Companies
Most of what Bill Gates said to me over the course of two interviews found its way into the cover profile of him I wrote for the most recent issue of Forbes. But one set of ideas didn’t really make it: his unique and thoughtful perspective on the pharmaceuticals industry.
Few outsiders have had as clear a view of the drug business as Gates. Over the past decade, Gates has relied on giants like Merck, Pfizer, and Sanofi-Aventis to provide the vaccines that are a lynchpin of his charitable work. He’s had a long-standing collaboration with GlaxoSmithKline over a malaria vaccine. The Bill & Melinda Gates Foundation recruited its last research head, Tachi Yamada, from Glaxo, where he had headed drug R&D. During his tenure, Yamada helped the Gates Foundation develop a meningitis vaccine from scratch to help people in parts of Africa. Yamada’s replacement, Trevor Mundel, hails from Novartis, where he ran clinical trials – a sign that some industry insiders say means that the Gates Foundation may be heading even further into the development of new vaccines and drugs.
After a conversation with Gates, one wonders if the drug industry has hurt itself by focusing too much on $100,000 cancer drugs and blockbuster pills that can be sold to millions, and not enough on products that are far more cost-effective. And then, of course, there’s the fact that the entire $600 billion pharmaceutical industry has spent the past decade in a research drought, getting comparatively few new medicines to market.
“Fortunately, our vaccine discovery rate has been better than the recent drug discovery rate of pharma,” Gates said. “And, you know, pharma doing well is important for the world, so hopefully their discovery rate will go up.”
Ten or fifteen years ago, nobody in the drug business would have held up vaccines as profit centers. That was the age of Pfizer’s Viagra having the fastest drug launch in history, of the even bigger cholesterol-lowering medicine Lipitor becoming the best-selling drug in history and forcing Pfizer’s $116 billion buyout of partner Warner-Lambert, ushering in a new age of megamergers that experts believe may have squelched innovation in drug company labs.
Says Gates: “If you 15 years ago had said, ‘How important are vaccines to these various businesses?’ They would have said, “You know, our drug businesses are going to do so well. And vaccines are so tough, particularly because of liability issues.’”
But vaccines, Gates argues, “actually have more impact on health than all the new drugs.” And the pharmaceutical businesses didn’t do as well as expected. For Pfizer, for instance, a big bet on a Lipitor follow-up went down in flames when the drug turned out to increase, not decrease, the death rate. But now Pfizer is betting big on a vaccine, called Prevnar, against the pneumococcus bacteria. After Lipitor loses patent protection, Prevnar may well be the company’s top seller.
Gates thinks it is “ironic” that vaccines have done so well, along with AIDS drugs that have been a boon to companies like Gilead, one of the biggest biotechnology companies, and Merck, while heartburn medicines, cholesterol drugs, and antidepressants have failed to pay off.
When it comes to cancer drugs like Avastin and Erbitux, some of the biggest sales successes of the past decade, Gates seems unimpressed. “There’s always this divergence between what’s financially attractive and what has dramatic profit and the number of life years that you really save.” Take for instance, Novartis’ Gleevec, the crown jewel of targeted cancer drugs that can put chronic myelogenous leukemia and gastrointestinal stromal tumors into remission. “Do the math on that versus, says, preventing Parkinson’s or preventing Alzheimer’s. It’s in a different universe.”
The good news, to Gates’ mind, is that right now people are making money in the vaccine business. That means that more research is getting funded, and more innovation is happening.
“The rich world companies do more,” he says, “and that means the Chinese and Indian companies see that and they do more. You know, so it’s a pretty good virtuous cycle right now in terms of focus on vaccines. ”
Part of the drug industry’s problem, though, is that the process of inventing new drugs and vaccines has gotten more complex. Forty years ago, Leo Sternbach, a Roche scientist, could invent whole swaths of anti-anxiety drugs, and Merck vaccine researcher Maurice Hilleman, one of Gates’ heroes, could develop the bulk of the vaccines still given to children today.
“It’s like the breadth of software I got to do at Microsoft,” says Gates. “Things become more specialized and, you know, and more complex. So the idea that one guy does, like, ten different vaccines, including multiple iterations of them. And the combinations of them. He was on a roll. He got Merck into that. He figured out how it worked. He had the guts to go and try things.”
The sad reality: as innovation piles on innovation, doing something new and different only gets harder.
http://www.forbes.com/sites/matthewherper/2011/11/10/what-bill-gates-says-about-drug-companies-2/2/
Friday, November 11, 2011
Twenty-One Top Twitter Tips
Twenty-One Top Twitter Tips
Daniel Adler
Silly time waster? Sure. Powerful business tool? You bet.
You've heard about Twitter--that curious, strangely addictive social-networking technology that facilitates torrents of truncated messages among millions of users. You might even know your hashtags from your re-tweets. But how can you make money with it?
Forbes canvassed scads of businesses and pricey social-networking gurus looking for honest answers. Admittedly, we were skeptical. After all, how much can you accomplish in 140 characters or less?
Turns out there are myriad ways Twitter can have an impact, and not just as a marginal marketing tool. Indeed, we found 21 clever ways to use Twitter--for everything from boosting sales and scouting talent, to conducting market research and raising capital. Chances are, there will be many more.
"I believe Twitter is a communication platform," says Nathan Egan, founder of Freesource Agency, a social-networking consultancy in Philadelphia. "In a year or two, everyone will be on it, using it in totally new ways." Better yet, getting results "doesn't take a year or six months, but a matter of weeks," adds Mark Schaefer, head of Schaefer Marketing Solutions in Knoxville, Tenn.
Some strategies take more time, or are more industry-specific, than others. Taken together, though, this collection of techniques and real-world examples constitutes a powerful online arsenal for companies large and small. Herewith, some highlights:
Coupon Campaigns
Congratulations for getting to the end of this sentence. "As an online culture, people are not reading; they're scanning," says Dell ( DELL - news - people ) Computer's Stefanie Nelson, voice of @DellOutlet. "The shorter and more direct your message is, the more successful you're going to be." Dell tweets links to coupons at Dell Outlet's Facebook page, which shoppers use during checkout at Dell.com.
This strategy works for small companies, too: The abbreviated offers are easy to produce--you don't need an ad agency to write 140 characters. California Tortilla, a chain of 39 causal Mexican restaurants based in Rockville, Md., spread coupon "passwords"--through its Twitter feed @caltort--that must be spoken at checkout to be redeemed.
Viral Marketing
In July, in honor of its 10th birthday, London-based do-it-yourself Web site builder Moonfruit gave away 11 Macbook Pro computers and 10 iPod Touches. Contestants had to tweet using the hashtag #moonfruit. (Hashtags collate Twitter responses.) Nearly a month after the contest ended, traffic to Moonfruit's Web site is up 300%. Sales are up 20% this month, more than paying off the $15,000 investment. And the Moonfruit Web site has climbed onto the first Google ( GOOG - news - people ) page for "free website builder" (it used to be on the fourth).
Word to the wise, says Moonfruit founder Wendy White: Such campaigns must be courteous and fit with a company's brand, lest you draw the ire of the Twitter-sphere: "There's a fine line between annoying people and getting the thumbs up."
Artful Customer Service
Frank Eliason, director of digital care at Comcast ( CMCSA - news - people ), uses Twitter to help 200 to 300 subscribers a day with issues ranging from sporadic Internet service to errant e-mails. Frank and his team receive direct questions at the @comcastcares account and search for complaints. Twitter has a built-in search, but it's more efficient to set up a permanent search on one of the free, third-party Twitter applications, such as TweetDeck.
Eliason's key to success: maintaining friendly relationships, not foisting unwanted advice. "If they want assistance, they'll let me know," he says. Eliason has a 10-person help desk at his disposal, but small businesses can use Twitter to provide better customer service, too. Even a little help goes a long way.
Focus Groups
Back in the old days (last year), companies actually paid customers to solicit their opinions. There were 3.37 million mentions of Starbucks ( SBUX - news - people ) on Twitter through early May 2009, and all of that information is available for less than the cost of a frappucino. "There is a major element of Twitter that's about listening and learning," says Brad Nelson, the man behind @Starbucks. "Twitter is a leading indicator." Collecting the information is as simple as searching for references to your company.
Morgan Johnston, manager of Corporate Communications at Jet Blue, abolished a $50 fee for carry-on bikes after hearing complaints via Twitter. "Think of Twitter as the canary in the coal mine," says Johnston. "We watch for customers' discussions about amenities we have, and what they'd like to see made better." For a more formal approach, lob a simple post asking for feedback and provide a hashtag to collect the responses.
Poaching Customers
"Twitter is not just a kid story," says Chris Brogan, president of New Marketing Labs. Brogan should know: He is one of several Twitter experts advising companies on how to spy on their competition and to swoop in with a better service or discount.
Freesource's Egan describes how to do it: Using TweetDeck, set up a permanent search for all permutations of your competitor's name, as well as words that convey dissatisfaction ("sucks" or "hate"). Public replies to those new prospects are dangerous, as your competition may see them, so the best bet is to follow them and get followed back, allowing you to send direct messages.
Customer Expectation Management
Bad things happen--it's how you condition customers to deal with it that counts. Jet Blue tweets flight delays. In April, when a Stanley Cup broadcast was interrupted, cable provider Comcast used Twitter to immediately inform its subscribers that the culprit was a lightning storm, and that transmission would soon be restored.
Small companies--like United Linen, a linens and uniform company in Bartlesville, Okla.--can manage expectations this way, too. When a major snowstorm hit the area, Marketing Director Scott Townsend used Twitter to let customers know deliveries would be delayed. "It was a great way to send information to everyone," he says. "They understood we wouldn't be there, but they wanted to know what our status was and updates as the situation changed."
Corralling Eyeballs
During last year's NBA Eastern Conference Finals between the Cleveland Cavaliers and the Orlando Magic, Turner Broadcasting managed to weave social-media feeds into its home page. Fans accessed the conversation by logging onto Twitter through TNT.com, and the tweets were also posted on Twitter with links back to TNT.com. Those forums mean more Web traffic--and thus more advertising revenue. "It's exciting to sell this to an advertiser," said Liza Hausman, vice president of marketing for Gigya Socialize, the brains behind the integration technology.
Vendor Selection
Twitter can snag customers, but how about suppliers? Crowdspring, an online marketplace that marries businesses with graphic designers (see "The Creativity Of Crowds"), used Twitter to build up its stable of contributors--now 12,000 strong globally.
Business travelers can apply this same logic: Tweeting that you're about to visit a city can scare up discount offers from hotels, bus companies and other travel-services providers.
Conflict Resolution
Wiggly Wigglers, a Herfordshire, U.K.-based marketer of gardening and farming supplies, was recently overcharged $10,500 by British Telecom. Five months passed without restitution.
Finally, Wiggly owner Heather Gorringe hit the Twitter-sphere, asking if anyone else had had problems with BT. @BTCare sent Gorringe a message within 30 minutes promising help; two days later, the bill was amended. "When I phone them up, I'm an isolated call to deal with, so I'm less important," says Gorringe. "But if I tweet, and 1,193 people re-tweet, 100,000 people see it within 30 seconds."
Employee Recruitment
Sodexo, a food services and facilities management company, trains its recruiters on Twitter and other social media. An automated program sends prospects a direct message whenever a position opens up, and the messages are opened 30% of the time.
The trick, says Arie Ball, vice president of talent acquisition at Sodexo, is to be as personal and engaging as possible: "People get an insider's view, a sense if this is a company they want to work for." The company says that using Twitter as a recruitment tool has helped cut its investment in online job boards by hundreds of thousands of dollars.
Raising Capital
As in the physical world, no one likes to be solicited for contributions online. A better Twitter tack: Don't ask, just inform.
Last Thanksgiving, Epic Change, a nonprofit that encourages people to tell their stories to transform communities, launched the Tweetsgiving Web site, with the help of theKbuzz, a word-of-mouth marketing firm. Tweetsgiving asked people to tweet what they were grateful for, and compiled the responses at #tweetsgiving, with a link back to the Tweetsgiving site, where users had the option of contributing money to build classrooms in Tanzania.
Over the 48-hour campaign, 15,000 people came to the Tweetsgiving site; 360 donated, for a total of $11,000. "We never asked people to give," says Stacey Monk, founder of Epic Change. "We got people invested in their own, personalized way."
http://www.forbes.com/2009/07/31/top-twitter-tips-entrepreneurs-technology-twitter.html
Daniel Adler
Silly time waster? Sure. Powerful business tool? You bet.
You've heard about Twitter--that curious, strangely addictive social-networking technology that facilitates torrents of truncated messages among millions of users. You might even know your hashtags from your re-tweets. But how can you make money with it?
Forbes canvassed scads of businesses and pricey social-networking gurus looking for honest answers. Admittedly, we were skeptical. After all, how much can you accomplish in 140 characters or less?
Turns out there are myriad ways Twitter can have an impact, and not just as a marginal marketing tool. Indeed, we found 21 clever ways to use Twitter--for everything from boosting sales and scouting talent, to conducting market research and raising capital. Chances are, there will be many more.
"I believe Twitter is a communication platform," says Nathan Egan, founder of Freesource Agency, a social-networking consultancy in Philadelphia. "In a year or two, everyone will be on it, using it in totally new ways." Better yet, getting results "doesn't take a year or six months, but a matter of weeks," adds Mark Schaefer, head of Schaefer Marketing Solutions in Knoxville, Tenn.
Some strategies take more time, or are more industry-specific, than others. Taken together, though, this collection of techniques and real-world examples constitutes a powerful online arsenal for companies large and small. Herewith, some highlights:
Coupon Campaigns
Congratulations for getting to the end of this sentence. "As an online culture, people are not reading; they're scanning," says Dell ( DELL - news - people ) Computer's Stefanie Nelson, voice of @DellOutlet. "The shorter and more direct your message is, the more successful you're going to be." Dell tweets links to coupons at Dell Outlet's Facebook page, which shoppers use during checkout at Dell.com.
This strategy works for small companies, too: The abbreviated offers are easy to produce--you don't need an ad agency to write 140 characters. California Tortilla, a chain of 39 causal Mexican restaurants based in Rockville, Md., spread coupon "passwords"--through its Twitter feed @caltort--that must be spoken at checkout to be redeemed.
Viral Marketing
In July, in honor of its 10th birthday, London-based do-it-yourself Web site builder Moonfruit gave away 11 Macbook Pro computers and 10 iPod Touches. Contestants had to tweet using the hashtag #moonfruit. (Hashtags collate Twitter responses.) Nearly a month after the contest ended, traffic to Moonfruit's Web site is up 300%. Sales are up 20% this month, more than paying off the $15,000 investment. And the Moonfruit Web site has climbed onto the first Google ( GOOG - news - people ) page for "free website builder" (it used to be on the fourth).
Word to the wise, says Moonfruit founder Wendy White: Such campaigns must be courteous and fit with a company's brand, lest you draw the ire of the Twitter-sphere: "There's a fine line between annoying people and getting the thumbs up."
Artful Customer Service
Frank Eliason, director of digital care at Comcast ( CMCSA - news - people ), uses Twitter to help 200 to 300 subscribers a day with issues ranging from sporadic Internet service to errant e-mails. Frank and his team receive direct questions at the @comcastcares account and search for complaints. Twitter has a built-in search, but it's more efficient to set up a permanent search on one of the free, third-party Twitter applications, such as TweetDeck.
Eliason's key to success: maintaining friendly relationships, not foisting unwanted advice. "If they want assistance, they'll let me know," he says. Eliason has a 10-person help desk at his disposal, but small businesses can use Twitter to provide better customer service, too. Even a little help goes a long way.
Focus Groups
Back in the old days (last year), companies actually paid customers to solicit their opinions. There were 3.37 million mentions of Starbucks ( SBUX - news - people ) on Twitter through early May 2009, and all of that information is available for less than the cost of a frappucino. "There is a major element of Twitter that's about listening and learning," says Brad Nelson, the man behind @Starbucks. "Twitter is a leading indicator." Collecting the information is as simple as searching for references to your company.
Morgan Johnston, manager of Corporate Communications at Jet Blue, abolished a $50 fee for carry-on bikes after hearing complaints via Twitter. "Think of Twitter as the canary in the coal mine," says Johnston. "We watch for customers' discussions about amenities we have, and what they'd like to see made better." For a more formal approach, lob a simple post asking for feedback and provide a hashtag to collect the responses.
Poaching Customers
"Twitter is not just a kid story," says Chris Brogan, president of New Marketing Labs. Brogan should know: He is one of several Twitter experts advising companies on how to spy on their competition and to swoop in with a better service or discount.
Freesource's Egan describes how to do it: Using TweetDeck, set up a permanent search for all permutations of your competitor's name, as well as words that convey dissatisfaction ("sucks" or "hate"). Public replies to those new prospects are dangerous, as your competition may see them, so the best bet is to follow them and get followed back, allowing you to send direct messages.
Customer Expectation Management
Bad things happen--it's how you condition customers to deal with it that counts. Jet Blue tweets flight delays. In April, when a Stanley Cup broadcast was interrupted, cable provider Comcast used Twitter to immediately inform its subscribers that the culprit was a lightning storm, and that transmission would soon be restored.
Small companies--like United Linen, a linens and uniform company in Bartlesville, Okla.--can manage expectations this way, too. When a major snowstorm hit the area, Marketing Director Scott Townsend used Twitter to let customers know deliveries would be delayed. "It was a great way to send information to everyone," he says. "They understood we wouldn't be there, but they wanted to know what our status was and updates as the situation changed."
Corralling Eyeballs
During last year's NBA Eastern Conference Finals between the Cleveland Cavaliers and the Orlando Magic, Turner Broadcasting managed to weave social-media feeds into its home page. Fans accessed the conversation by logging onto Twitter through TNT.com, and the tweets were also posted on Twitter with links back to TNT.com. Those forums mean more Web traffic--and thus more advertising revenue. "It's exciting to sell this to an advertiser," said Liza Hausman, vice president of marketing for Gigya Socialize, the brains behind the integration technology.
Vendor Selection
Twitter can snag customers, but how about suppliers? Crowdspring, an online marketplace that marries businesses with graphic designers (see "The Creativity Of Crowds"), used Twitter to build up its stable of contributors--now 12,000 strong globally.
Business travelers can apply this same logic: Tweeting that you're about to visit a city can scare up discount offers from hotels, bus companies and other travel-services providers.
Conflict Resolution
Wiggly Wigglers, a Herfordshire, U.K.-based marketer of gardening and farming supplies, was recently overcharged $10,500 by British Telecom. Five months passed without restitution.
Finally, Wiggly owner Heather Gorringe hit the Twitter-sphere, asking if anyone else had had problems with BT. @BTCare sent Gorringe a message within 30 minutes promising help; two days later, the bill was amended. "When I phone them up, I'm an isolated call to deal with, so I'm less important," says Gorringe. "But if I tweet, and 1,193 people re-tweet, 100,000 people see it within 30 seconds."
Employee Recruitment
Sodexo, a food services and facilities management company, trains its recruiters on Twitter and other social media. An automated program sends prospects a direct message whenever a position opens up, and the messages are opened 30% of the time.
The trick, says Arie Ball, vice president of talent acquisition at Sodexo, is to be as personal and engaging as possible: "People get an insider's view, a sense if this is a company they want to work for." The company says that using Twitter as a recruitment tool has helped cut its investment in online job boards by hundreds of thousands of dollars.
Raising Capital
As in the physical world, no one likes to be solicited for contributions online. A better Twitter tack: Don't ask, just inform.
Last Thanksgiving, Epic Change, a nonprofit that encourages people to tell their stories to transform communities, launched the Tweetsgiving Web site, with the help of theKbuzz, a word-of-mouth marketing firm. Tweetsgiving asked people to tweet what they were grateful for, and compiled the responses at #tweetsgiving, with a link back to the Tweetsgiving site, where users had the option of contributing money to build classrooms in Tanzania.
Over the 48-hour campaign, 15,000 people came to the Tweetsgiving site; 360 donated, for a total of $11,000. "We never asked people to give," says Stacey Monk, founder of Epic Change. "We got people invested in their own, personalized way."
http://www.forbes.com/2009/07/31/top-twitter-tips-entrepreneurs-technology-twitter.html
Law of Patience, with business
Patience is not a skill that comes naturally. At least not to me. I’m just as aggressive as the next person when it comes to wanting to see the impact from my ideas. What I have plenty of is impatience. I want to see the results now, not years down the line. The reality is that innovation takes time.
One example of getting it right is the story of David Packard and HP’s decision to jump into the computer market. At the time, the industry was dominated by IBM, DEC and others. HP managers made their case that HP should enter the market based on the companies expertise and capabilities. David wasn’t convinced but made the decision to follow the expertise, commitment and passion of his executives. When the decision was made, David made it clear to everyone inside HP, that this was a total commitment on the part of the company. The timeline he set out? To be the #1 computer manufacturer in the world in 25 years. How long did it take? HP became the #1 computer manufacturer in 23 years. That’s what I call “sticking with it“.
At the same time, some innovations do need to be killed. They should be killed when all other options for success have been exhausted and its obvious that they aren’t going to deliver.
Be careful not to be too quick to pull the trigger and kill an idea. Anyone can use short term metrics to rationalize a decision not to go forward. The safe answer is “no” as it eliminates the risk while the risky answer is “yes”, when the path to success is not guaranteed. There are no guarantees in life. I’m sure Bill and Dave questioned the decision to go into computers, but they had patience and stuck with it.
How should you instill patience into your innovation programs?
1. Be realistic about how long this is going to take and set an appropriate time horizon. If it will take decades, then set the timeline accordingly.
2. Define regular checkpoints/gates with clear objectives for each gate. Do not make these gates correspond to budget or planning cycles.
3. Do NOT use the gates to rationalize killing the project, but instead, use the gates as a prompt for management to know where to commit time and resources to ensure the project is successful.
4. Only after you’ve exhausted all options over multiple gates, do you consider killing the project. Even then, make sure you aren’t killing it for the wrong reasons (e.g. getting nervous, wall street pressure, etc)
The point is, when you start down the path of creating breakthrough innovations, realize that you are making one of the most significant commitments for the organization. Once you commit, then really commit. Don’t throw in the towel at the first sign of trouble.
How important is the law of patience to your organization?
http://www.forbes.com/sites/philmckinney/2011/09/07/innovation-law-4-the-law-of-patience/
One example of getting it right is the story of David Packard and HP’s decision to jump into the computer market. At the time, the industry was dominated by IBM, DEC and others. HP managers made their case that HP should enter the market based on the companies expertise and capabilities. David wasn’t convinced but made the decision to follow the expertise, commitment and passion of his executives. When the decision was made, David made it clear to everyone inside HP, that this was a total commitment on the part of the company. The timeline he set out? To be the #1 computer manufacturer in the world in 25 years. How long did it take? HP became the #1 computer manufacturer in 23 years. That’s what I call “sticking with it“.
At the same time, some innovations do need to be killed. They should be killed when all other options for success have been exhausted and its obvious that they aren’t going to deliver.
Be careful not to be too quick to pull the trigger and kill an idea. Anyone can use short term metrics to rationalize a decision not to go forward. The safe answer is “no” as it eliminates the risk while the risky answer is “yes”, when the path to success is not guaranteed. There are no guarantees in life. I’m sure Bill and Dave questioned the decision to go into computers, but they had patience and stuck with it.
How should you instill patience into your innovation programs?
1. Be realistic about how long this is going to take and set an appropriate time horizon. If it will take decades, then set the timeline accordingly.
2. Define regular checkpoints/gates with clear objectives for each gate. Do not make these gates correspond to budget or planning cycles.
3. Do NOT use the gates to rationalize killing the project, but instead, use the gates as a prompt for management to know where to commit time and resources to ensure the project is successful.
4. Only after you’ve exhausted all options over multiple gates, do you consider killing the project. Even then, make sure you aren’t killing it for the wrong reasons (e.g. getting nervous, wall street pressure, etc)
The point is, when you start down the path of creating breakthrough innovations, realize that you are making one of the most significant commitments for the organization. Once you commit, then really commit. Don’t throw in the towel at the first sign of trouble.
How important is the law of patience to your organization?
http://www.forbes.com/sites/philmckinney/2011/09/07/innovation-law-4-the-law-of-patience/
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