The company focuses on Venture Capital and structured investments and Bio Technology and pharmaceuticals. Prior for 16 years he led the firms in investment in Bio Technology and pharmaceuticals. Hes been active in policy discussions, served on the executive committee on the board of national Venture Capital association and led that groups Life Sciences efforts. Hes also served on the emerging Company Section board on the Bio Technology board industry organization. Hes served on many nonprofit boards. He is a graduate of Harvard University and the Stanford School of business. And we really appreciate your coming. Thank you. And its great to be here. Were going to talk. Im going to start with a provocative question. Does the Investment Community view the u. S. , food and Drug Administration as a Necessary Evil or as a critical ally or or Something Else . Thats a great question. I obviously cant speak on the behalf of the entire Investment Community, but i would say overwhelmingly fda is viewed as a critical ally. And it is clearly recognized the ability to do what we all do to invest the quantities of the hundreds of millions of dollars necessary to develop drugs and bring those drugs in a way that is sustainable to the market is a function of having the fda and the Gold Standard of the fda as the regulator. So i think that really does distinguish the biopharma enterprise from most other industries where the regulators are viewed as a Necessary Evil and bureaucracy that slows things down. Certainly from the industry you will hear complaints about specific decisions or specific interactions that are had with fda. And that is to be expected and inevitable because theres so many different perspectives and complexities here. But i think its almost universely recognized that without a robust and effective fda, we couldnt make the bio pharma innovation enterprise work. What is it about fda that investors want to hear, want to see . What kinds of information can come out of the agency . What kinds of explanations are people interested in . Stepping back, first of all, i want to thank you for inviting me to be here, josh, and get the investment perspective kind of things and i want to thank on the blueprint you put out and the focus youre bringing to this extremely important issue because its one i feel very passionate about. And ive been asked various times over the 20 plus years ive been in the Venture Capital business in bio tech, what are the initiatives that could be implemented that could make that whole system better . And one of the things ive often said is Greater Transparency and Public Access to the kinds of information that exist at fda. I often get a stony silence from bio tech and Pharma Company ceos when i say that, because i think they take a somewhat more cautious perspective of this, and we could talk about why. But from my perspective this is great opportunity to enhance the Decision Making that professionals make in terms of how to use marketed drugs but also to make the whole enterprise of developing drugs better and more innovative and more efficient. Now, why is that . The reason i say that is very simply the whole purpose of the Capital Markets, the investment markets is to direct Investment Capital to the most promising opportunities. And we all know, weve all seen the statistics about the hundreds of millions and dollars it cost to develop the drug and the very high failure rates that we have in the sector. Every time that huge dollars are invested in a drug that does not ultimately succeed and get to patients, those are dollars that cannot be invested somewhere else. Those were dollars that were in effect wasted. Now, youre always going to have that happen because you cant be right all the time. You cant be right all the time. But to the extent the dollars can be allocated more thoughtfully and based on better information, well get more innovation, better drugs and better returns on investment which will then transfer into work capital, more dollars going into things and more dollars going into projects. Is it fair to say transparency has a direct and indirect effect . Direct because you can pick up a document the fda releases, a complete response letter and learn something that could influence your investing decision based on the likelihood a product will succeed and fail and indirectly because the fda is releasing large quantities of information and researchers will be using that information in producing academic materials that will provide insight into the decisions that youre making . Absolutely. There is the immediately Company Specific information that one wants to have an investor to make the best possible decision. One wants to know as much as possible of what can be known about the drug and experience that has been had in patients and Clinical Trials to date. And incredibly importantly one wants to know what fda and the company have said to each other about it. One wants to know if theyve really reached agreement on a path to approval and whether the company is studying end points in its Clinical Trials whether fda will deem sufficient for approval or whether they will have uncertainties about that. One wants to know that. So thats the immediately companyspecific or drugspecific information one wants. But then also as you say to the extent the whole enterprise becomes more educated about whats going on, one can infer learnings from one set of Clinical Trials to other drugs in the same condition that are being developed. Thats extraordinarily important. And not only just Clinical Trial information but regulatory. When one Company Develops often together with the fda a better idea about how to develop a drug for a particular condition, what Patient Population to study, what end points to study that will provide the most robust treatment that measurable and detectable, one wants to know not not only for the drug thats being developed but for the Community Active in that area. Can i just say i endorse essentially everything that was in your blueprint for Greater Transparency to the fda while recognizing there are complexities related to commercial and confidential information and burden that is put on fda. And certainly when you get into patient level data, confidentiality. And there are very legitimate concerns that must be addressed. But i endorse essentially whats there, but i would go much further. I would certainly endorse the release of the complete response letters or at least as was talked about with the commissioner this morning, the release of clinical and regulatory information, not so much the manufacturing information that may be confidential. But understanding why fda, what fda found to be deficient about a companys file for approval and what theyre asking for in terms of Additional Information to try to address that is incredibly important. But that even for me is the end of the road. Most of the time were investing in companies or Drug Development programs that are not yet unfortunate enough to have received a complete response letter. But were still very, very interested in what fda has to say about it and what the company has presented to fda in the context of the back and forth. Right. Someone might say why dont you just ask the company . If youre financing it, why wouldnt the company just hand over all the documents . I mean help me understand the need for fda to have a policy rather than for you to thats a great question and is often what fda officials will say is dont put the burden on us. Companies can release anything they want. They can reluease the full correspondence if they choose to. Companies essentially never do. I can count on one hand the fda documents released in their entirety by companies. Why is that . This a great perversity in the Capital Markets as i see it. I spend most of time investing in Venture Capitals and those kind. But my colleagues spend more time investing into private companies. As investors always we demand to see the primary fda documents. That is a condition to invest, and we will essentially never invest if a company wont hand that over to us under a confidentiality agreement. Sometimes companies resist a bit, but ultimately if they want our capital theyre going to provide that. And those documents, the back and forth between a company and the fda throughout the Drug Development process are very often the most informative things or among the most informative things that we get to see in making Investment Decisions about companies. And often we learn things that we wouldnt have learned anywhere else. Unfortunately, often we find out or sometimes we find out the way management has conveyed their intera int interactions of fda where not quite reflecting the full texture of whats in those documents. When we invest in public companies, we essentially never get to see that. We cant demand that or the companies can say no and they dont release this information. And so the perversity of if its the most Important Information to us as an investor in a private company, a similarly situated private company, billion of dollars of Investment Decisions are being made. And another perversity tat always strikes me there are requirements for companies to release Material Information about their business. And the fcc is of course the traffic cop for all of that. Companies are required to release any material agreements they enter into in the course of their business, if theyre a private company. Ask those agreements are filed as attachments to fcc filings. So i can or any member of the public can go and read the release that a Biotech Company has entered into it with its landlord. But i cant go and read the spa that the company has entered into which is the criteria for what the successes are. Theres a great perversity in what is out there in Public Information in biotech. So it sounds like its your view, more data, better decisions that you could make, more likely that medical products be developed that are successful, that will get the support that patients who want drugs to be developed will actually have products developed for their conditions with Greater Transparency. But i want to go back to the stony faces you mentioned before. So despite this advantage, despite the people who are investing in companies, you know, really wanting to see this information, companies are skeptical. And i wonder if this is case in their own case theyre worried about something, but, you know, for the whole enterprise it would advance if there were Greater Transparency. But im wonder how do you understand their stony faces as you put it . Well, theres a secret unspoken reason for it from my point of view, and ill tell you what it is here, companies are afraid their stock prices will go down if all that information is in the public domain. I dont mean to minimize the legitimate concerns that are there as well and that is legitimate concern. But i believe that thoughtful people working through that can manage that in the same way you can redact competitively Sensitive Information in the fcc filings. But it doesnt change the fact it is deemed important for the fcc as it is for the Capital Markets while redacting what is competitively sensitive. But it is a bit of a prisoner emphasis dilemma as you characterize it. Because companies are afraid that if they are the only one to release their documents, and this goes back to your question as to why dont companies do it, if one company does it and no one else does in general what Companies Say about their fda interactions is putting a positive face on whats in those documents. If you release the documents then you see all the sor dud details and questions that come up in the process and uncertainties and so on, now i firmly believe that if that were out there for every company, on a level playing field, if they were automatically released, then most Company Stock prices i believe would be higher because Greater Transparency would lead to greater confidence in Investment Decisions. What happens in reality is every time we hear investors describe their interactions with fda most companies do describe it fairly. Some dont. And because you dont know in any given case, you have to ascribe some kind of a discount factor to the things i may not know about the companys interactions with fda that i may find out later that would burn me. So how does the discount factor have an impact . It means less money for them . Whats the impact of that . Yeah, it means instead of being 100 confident that i feel like i know when the Company Tells me, for example, weve agreed with fda that the end point were using in our phase three program is supportive of approval, so if weve hit that end point fda will agree weve demonstrated advocacy in an effort to support approval. When you hear that, you say, okay, im 90 sure thats true. The company having said that, and therefore whatever the evaluation is on the business, if i think the company is worth the 300 million maybe it would be worth 350 million if i were really sure if what they were telling me is true. It has all kind of implications on the companys ability to raise capital. When they go out to issue stock to raise capital for their Clinical Trial development programs. The Companies Care immensely as they need to what is the evaluation of their company, is their stock price because that informs their ability to raise capital. So if we have a situation where individual companies which are very worried about the specific products, dont want to be the first ones to put all that information out there and potentially have it picked apart, yet at the same time if all the information were out there, the whole enterprise would go for it and the stock priced would be higher and more importantly investors from the companys perspective would be more interested in investing more now, in the context of dr. Gottlieb, hes taking sort of modest steps. You know, hes starting with the csrs. Hes assigned someone to look at 100 complete response letters. He seems to have a few ideas on how to get the companies to move forward. You know, he seems to be saying that part of the deal will be a different, maybe more coherent review if they signup for this. But what are the kinds of things that you think people can do, maybe not just Investment Community but others if they want to support what the commissioner is doing and really see him go further . Well, i think its a matter of public policy. I dont think this prisoners dilemma can be solved by exporting companies to release information. Theyre not going to unless everybody else does and everybody else isnt going to unless they have to for some reason. So it seems to me that im not the expert on the legalities here, but mulultimately it fallo some kind of legislation or policy decision by regulators to say we are going to make available this information or were going to require that Companies Make available certain categories of information. So my simple way of thinking about it, the simple way to do this would be for fda to release everything in the way that the sec releases everything. I can go in and see not only the companys sec filings but the drafts that led to the filing. I would certainly like to see a similar kind of concept at the fda where all these documents that already exist, Companies Make their submissions to fda in the context of formal meetings. Fda responds to those with formal responses. All of those meetings result in forming minutes that are ultimately provided to the company. This is probably not practical in a single step, but i sort of youll take it all. Id like to see and envision where we would love to be and get to somehow, if you could release all of that with mechanisms to redact and enable companies to redact information that really is competitively sensitive, that would solve this problem. And youre not imposing a whole lot of burden on the fda because theyre already producing these documents. Youre saying were going to post them on a server somewhere where the public can access. Now, this redaction process would require some resources. I dont mean to trivialize all that, but its a whole lot easier what fda struggles with for good reason, which is fda should release companys public statements. It probably is good thing for fda to be able to counter truly misleading information that is put out into the marketplace. So i would endorse that, but thats a huge burden on fda to track that information, figure out when they should take that step and the potential for that to become politic