How to Stop China From Leapfrogging the US in Biotech

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2:41in a pivotal sphere. We should point out that Beijing for years has imposed travel restrictions on key personnel from prominent college researchers to nuclear scientists and executives at state firms. Okay, at the same time, a few things catching our attention apart from that. A report about a Nobel-winning chemist leaving the U.S. to direct an AI materials lab in China. And then, Carol, an op-ed piece about how to stop China from leapfrogging the U.S. when it comes to biotech. That was in the Washington Post. It actually caught the attention as well of our next guest. Robert Blum is with us. He's president and CEO of the nearly$11 billion market cap clinical stage biopharma and biotech company.

3:18It is Cytokinetics. He launched this company back in 1998. Stock, by the way, up about 27 % year-to-date. He joins us in studio. Welcome, welcome. Thank you. Thanks for having me. You know, if I can share before we got going when I said, you've been there at the company long and you reminded us that you launched the company, but you don't necessarily, you like to credit the research team that founded your company. Research is at the heart of so much in your industry. Tell us about what concerns you right now. Yes. So one of our core values at the company is science is in our soul. We have four scientific founders.

3:59We refer to them as our four amigos. And they came out of academia because they had good ideas, ingenuity leading to innovation. We joined them, several of us with business backgrounds in launching this company. And what concerns me, and ours is a quintessential biopharmaceutical story, is that in today's day, it's harder to build these types of companies that could ultimately deliver sustainable enterprise and medicines for the longer arc of benefit to patients. And that's because, I think, and it shouldn't be as a surprise to anyone, there's an evolution that has reached an urgent call to action.

4:40I do believe that companies like cytokinetics would be far more difficult to build today, in part because we don't have an industrial policy, a nationwide commitment to science, medicine, and the pursuit of the kinds of things that cytokinetics does so well. When did we lose that vision? I'd say we've lost it over a period of years, but it's more acute care now over the last two to three years. Because of the Trump administration's cuts? I wouldn't say it's only because of that. I would say that there's a natural competitive advantage that is beginning to be ceded to China for the fact that they've made a deliberate strategic commitment to a policy industrialization that we could do well to mimic and demonstrate again how we can win.

5:36You know, it's interesting. It comes at a time when you think about something like critical minerals or rare earths. We certainly, it seems increasingly, have a national policy about that. When it comes to semiconductors, you even have a government that's taking, we all own pieces of an Intel or some other names. Which, by the way, not everybody thinks these are good industrial policies. No, it's a really good point. And what's interesting is the U.S. has often criticized China specifically for its role in their businesses. Um, what's at risk? Cause you say this has been happening for a while.

6:10So maybe it's not political because it sounds like it's happened under different administrations. Um, so what are we missing? What are we losing? Cause I also feel like if you go back to COVID, we realized how exposed we were as a nation as well, not just supply chains, but for pharmaceuticals. Absolutely. And you make a good point. It starts with commoditization of pharmaceutical ingredients, moves to supply chains, then to clinical trials, and ultimately to medicines for patients. Cytokinetics is a great example of a company where patients are at the heart of everything we do. And we believe very much that science and medicine should know no borders.

6:51But at the same time, there are things we can do to outcompete and to continue to capitalize on where there's ingenuity. For instance, where do early career scientists feel like they're going to have the best opportunity to make an impact, make a dent in the universe for medicine and patients? In the United States, there's been more recently a beginning of distrust around science. We need to restore that trust in science for the benefit of scientists who want to contribute to humanity and benefit mankind. To be fair, I do feel like that is certainly something you can point to the current administration for.

7:29You know, I don't want to get into the politics of it all, but I will say it has, I believe, transcended politics to the point where it's distrust for science, funding for that which is government and academic science for the benefit of companies like ours that can industrialize that. What I find notable about what you're saying is that, I mean, your roots are Silicon Valley. That's where your company's based. That's where the DNA of your company is. There's so much of Silicon Valley has gone to Washington with this administration. Do you have conversations with the folks who used to be on your home turf who are now in Washington?

8:06They are the ones who, they understand academia. They understand research. They understand science. They understand investing and the way that startups play a role in this ecosystem. Yeah, all the time. And you're right. it just hasn't yet extended to biotechnologies the way it should. When nation states decide that biotechnology is an industrial competitive advantage, they'll be, I think, lining up together with us to be able to do what's right for all patients, regardless of geopolitics. And that's something that I think cytokinetics can be an exemplar. We used to talk about how we can punch above our weight class at cytokinetics.

8:47Ours is a company built on the industrialization of science that started with federal funding of academic research, and then we parlayed that into research development and now commercialization. It's taken us 28 years to get to a place where we have a sustainable R &D engine that can deliver medicine after medicine. We just launched our first commercial medicine earlier this year, a drug for the treatment of a disease called obstructive hypertrophic cardiomyopathy. Over the course of 28 years, we invested billions, literally$3 to$4 billion in net operating deficit until now. but for the fact that this can harvest return for patients, return to shareholders in a way that companies like Genentech or Amgen, Vertex, Regeneron have done.

9:38It took those companies 20 to 30 years and look at where they are now. They were startups at one point too. Hopefully cytokinetics can be an exemplar of that too. Robert, unfortunately, and I hope we can continue this conversation in the future, 30 seconds left here. So what would you like to see the administration do? Or I don't know. What is it between public and public sector? Just quickly. I think public-private can join together. We're all oriented towards the same objectives, mission and medical. And to the extent that we can make this a national priority, we can compete on our own merits.

10:13We don't need protectionism, but we do need to know that everybody's aligned to the same hopeful objectives. Yep. A common goal, perhaps. Robert Blum, thank you so much. President and CEO of Cytokinetics joining us right here.

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