Cell Therapy Advances And Biotech Leadership With Nkarta's Paul Hastings

0:03Welcome back to the business of biotech. I'm your host, Ben Comer, chief editor at Live Science Leader. And today I'm speaking with Paul Hastings, CEO and board member at Encarta, a clinical stage biotech developing allogeneic natural killer or NK cell therapies for B cell mediated autoimmune diseases. Encarta's donor-derived CAR-NK development candidate, NKX019, is unique among allogeneic cell therapies in that it doesn't trigger graft-versus-host disease and doesn't require immune suppression, and it can be delivered in outpatient community settings. In addition to his leadership at Encarta, Paul is currently board chair at Specific Biologics and board member at NGene and a previous board member at more than 10 other companies and trade organizations, including Bio, where he worked for over two decades with a stint as Bio's board chair from 2021 to 2023.

1:01His executive experience extends to CEO and board roles at Oncomed Pharmaceuticals, QLT, Axis Pharmaceuticals, and others. He's previously served in management positions at Genzyme, Synergen, which is part of Amgen, and Roche. Finally, Paul is active in several social, patient, and community advocacy groups, including the Youth Rally, Life Sciences to End Gun Violence epidemic, No Patient Left Behind, OutBio, the San Francisco chapter, and the Tremere Institute. I'm thrilled to have Paul on the show today for an update on Encarta and a broader view of the cell therapy development space. And we'll also talk about the current landscape for biotech company creation and the impacts of federal policy changes and what industry leaders can do to sustain the innovation ecosystem.

1:52Paul, thank you for bearing with me through that long introduction. And thank you for being here. Well, thank you. I don't need to tell you anything about the company now because you did the whole thing.

2:02Paul Hastings: That was great. Thank you. Well, one thing that we like to do here on the business of biotech, Paul, is to start off with a little bit of background. And I'm not going to ask you to walk back through your entire career because we don't have enough time to do that. But I would like to know what brought you into life sciences initially. You attended the University of Rhode Island and earned a degree in pharmacy. And then I think went straight to Hoffman LaRoche after graduating. Did you plan to become a pharmacist initially? That's right. Yes, I did. And I did. I became a practicing pharmacist by working inside the drug discovery and development industry.

2:42Paul Hastings: And I used my knowledge of pharmacy to do that. Now, I will take you all the way back to my teenage years when I was diagnosed with Crohn's disease, an autoimmune disorder. So that's one of the reasons I like doing what we're doing now in autoimmune disease. But I was so sick as a kid with Crohn's disease that our local pharmacist suggested to my parents that I go to pharmacy school because when I graduated, you know, I could work in his pharmacy. And if I needed to take time off, he would let me do that. And so that's kind of why I went into pharmacy. I was very science oriented anyway. But once I was in pharmacy school, I realized, first of all, I had surgery and my life became full and my energy all came back after that surgery that was missing for so many years with Crohn's disease.

3:27Paul Hastings: But I started realizing that business and the business of pharmacy was what I was interested in. Plus, my experience as a patient, having gone through what I went through as a teenager with Crohn's disease, led me to want to work on drug discovery and development. And, you know, I started in sales and worked my way through a bunch of different areas. But really what I say now at the age of 66, by the way, and I feel like I'm 66 going on 45, is that, you know, what I really like to do is take my experience as a patient and bring it to the industry. Not just the patients in our industry, like the patient advocacy organizations, but the CEOs and make them understand that what we're all here for is the patient, not the other way around.

4:12Paul Hastings: And so I kind of take a holistic approach to our industry, having been through so many different companies. And now we're doing it kind of want to do it, doing it the way that I want to do it, which is applying the patient first and what we do in discovery and development to develop and discover and deliver therapies for patients that are meaningful to them. Well, we have pharmacy in common. I was a pharmaceutical technician, worked at a mom and pop pharmacy all through high school and college and eventually parlayed that into a journalism job covering the life sciences industry. That's that's probably where our similarities end in terms of achievements.

4:54But that's where I was exposed to the industry as well. And I want to maybe start off with Encarta and what you're up to there. But before we do, and this is going to be a hard one, maybe. But what is the biggest change, Paul, that you've observed about the life sciences industry since those early positions in marketing at LaRoche? Wow.

5:16Paul Hastings: Yeah, that is a big question. You know, I'll take this back to the most impactful thing that I've seen was when Janet Woodcock at the FDA decided to make it an FDA initiative to work on patient-centric drug discovery and development. That really, no, I worked at Genzyme where Henry Tremere, my mentor, was all about patients and he was a unicorn back then, right? That he was all about patients. When the FDA decided that the patient voice is important, not just for discovery, but also for development and also approval of these drugs, that's really when everybody paid attention to it. And I think Janet Woodcock is and was the pioneer of this, reached out to a bunch of different patient organizations, in particular the Deshaies Muscular Dystrophy patient organization to really help get these new therapies approved based on patient reported outcomes.

6:16Paul Hastings: Not, you know, these instruments, disease activity indices that academics and bow ties have developed over the year, but real patient reported outcomes. And I think industry has paid a lot of attention to that. And I think now when any one of us develops a drug, the first thing we think about is what does this do to the patient in their patient's own language? Not in our language, not in the language of the clinicians, but in the patient's own language. And I see that as the biggest sea change ever. And I'm thrilled and celebrate that that is the case. Because even at the biotech industry organization today, I just came back from the bio board meeting two days ago.

6:55Paul Hastings: The focus of bio, a big focus of bio is patient advocacy. And I help stand that up at bio, but it's still going strong. And I think we got to remember when you, when you go through, when you get through all the other bullshit that we go through, trying to figure out this administration and what they're all about, if you bring it back to the patient, you can do nothing but be objective about it. Right. And so I think that's the biggest change I've seen over the past 45 years. I started working in my early days on HIV therapeutics and on, you know, rare diseases and disease people didn't know anything about.

7:31Paul Hastings: So training the general public and training even our companies about what is HIV, what is a rare disease has been part of my backbone of growth for myself. But now it's like it is front and center. And it's amazing that it is. So I'm really pleased. The one thing about this industry I'm really happy about is this focus on patients and meaning that we're focused on patients, not just saying it, meaning it. It's interesting what you say about Janet Woodcock, because as much as a company might want to bring those patient voices forward, use those as endpoints in clinical trials. If the FDA is not accepting and acknowledging these kinds of patient reported endpoints, it may not matter if the drug is not being approved.

8:22Do you so do you think that there are currently enough mechanisms, I guess, at the FDA to adequately bring those patient voices into review decisions?

8:32Paul Hastings: Oh, yes, absolutely. So I say the one thing the FDA is continuing to do is work with these patient groups and bring in – we work with a woman here, Jen McNary. She was the Shane Muscular Dystrophy mom of two boys. She's one of our patient advocacy people here at Ancarta. One of them died. The other one survived. The one that survived was on the surreptotherapeutic. The one that died did not get access to that in early clinical trials. And she actually went to the FDA with a video of her surviving son. When he responded to therapy, he was actually able to walk in a walk-a-thon, right? So this is a kid that was in a wheelchair who got this drug and was walking in a walk-a-thon while his big brother was pushing the wheelchair that he was supposed to be in.

9:20Paul Hastings: And she showed that to Jana Woodcock of the FDA. She goes, how can we say this drug doesn't work? Here's a video of my kid. And this started this videotaping evidence of patient-reported outcomes that actually helped get some of these drugs approved. Because when you just look at a disease activity indices, the ability to walk is one piece of a complicated disease activity index, right? But to see it, it's pictures and videos say a thousand words, right? So Jen right now is a major voice inside the FDA, even with the changes happening at the FDA, about patient-reported outcomes. So that is sticking.

10:02Paul Hastings: That's important. It's important to the FDA. It's important to getting drugs approved. And I think ultimately, we've finally kind of gotten our heads out of our butts in this industry about the way we look at clinical trials and outcomes of those trials that are meaningful to patients. And maybe when we look at patient reported outcomes, these things aren't validated. They haven't been through the rigorous peer review that other instruments have been through. But just publishing what we're seeing gets people thinking about why these things are important and has a major impact on people when they look at them.

10:38Paul Hastings: So, you know, I think this is really part of the next number of years of our industry's development is to remember what we're doing here. Who is our ultimate customer? It's not a payer. It's not the government. It is the patient who receives the drug who then has an impact or this drug has an impact on that patient. And it's the drug that succeeds or fails, not the patient in their well-being. So I'm just really excited about that. Yeah, I don't want to take us too far afield, but because you brought up Duchenne, I am curious about your read on the Capricor decision, you know, the kind of re-review.

11:17There was an adcom yesterday or the day before. I think the patient advocates are in favor of approving that drug. We don't know what the FDA is going to do yet. But I and, you know, you can't extrapolate from a single case, you know, what's in the mind of the FDA. But I wonder if you have any read on on that activity.

11:38Paul Hastings: I don't on that specific drug. I've heard about it, but I can't make an educated comment on whether it should be proved or not. But what I can say is giving companies and the patient groups the ability to have a hearing like that, to be able to express what they've seen and how they've seen what they've seen, and to be able to do that in a forum where people are listening, that's what's important. Yeah. If that drug gets approved, great. If it doesn't get approved and there's a scientific reason for it not to get approved, that's the whole reason you want to have a panel like that. But to make sure that the right people are on that panel that are paying attention to the patient focus, to the science focus, to the practical focuses, to the activities of daily living that patients are able to do with or without that therapy, that's really what's important and that's encouraging.

12:30Let's talk about Encarta. You've been CEO at Encarta for over eight years now, I think. What's the next milestone that you're working toward with NKX019?

12:43Paul Hastings: Dr. David Morgan Data in multiple autoimmune diseases in our phase 1-2 study by the end of this year. So definitive data that will tell us where do we go next. If we go to pivotal trials, where will we be going? And we'll have data. Again, we've announced this by the end of this year in one, two, three indications where we'll be able to say, hey, here's where we're going next. We're going to do pivotal trials in these indications, and here's what the data look like. with, you know, handfuls of patients with each disease with, you know, three, six months of follow-up data, you know, some cases one month, because as you roll patients over the course of time, you only have so many months of follow-up.

13:20Paul Hastings: But that's a real pivotal moment for our company. And you mentioned me being the CEO for eight years. I started Encarta with our venture capitalists that started this company. So I was the first CEO and it's been an honor to work in the field of oncology and now to pivot it to autoimmune disease. It really interesting for me is at the age of 66, this is the first company that I've run that's had an emphasis on diseases that also have affected me. So it's personal. It's really personal and it's really wonderful to be able to work, to be working in this space. So, so Encarta is a labor of love. The people here that, that have taken us to where we are today and, and, and to this very pivotal year for us, where we're going to be presenting data at the end of this year, which will be very telling in terms of where we go next.

14:09Yeah, I'm sure that must be a powerful, motivating factor. Is lupus the kind of, are you considering lupus the lead indication? Are you exploring multiple indications at the same time? I guess I'm asking, you know, what the data read that you're expecting will be on.

14:27Paul Hastings: Yeah. So there is one study, Entrust One, that is in lupus nephritis patients. And there's another study, Entrust 2, that's a basket study. And that has scleroderma, myositis, vasculitis, and rheumatoid arthritis as the indications that we're looking at there. So I'm not saying which ones, but a few of those indications will be the ones we will highlight. Those will be the indications where we've enrolled the most patients. The lupus area, I will say, is a crowded area. There's a lot of therapeutics in development in lupus. And there's, you know, one of the things I want to talk to you about is the way our clinical infrastructure system in this country is failing patients.

15:08Paul Hastings: Because there are so many patients out there that should be getting into clinical trials that are not getting into clinical trials because they're not part of the 5 % that has access to academic medical centers. And lupus patients suffer from that the most. And that's unfortunate. it. But, you know, we'll be announcing data in whatever indications we've enrolled the most patients and have the most follow-up in by the end of this year. All right. I'm going to come back to the clinical infrastructure piece and maybe get your recommendations on what needs to happen. But I have a couple of other things I wanted to ask you about NCARTA.

15:44And one is that the NKX019 relies on healthy donor cells that are then engineered before patient administration. My question is, are there enough donors to treat a U.S. population of 1.5 million? And I'm talking about lupus here, 1.5 million, I think, in the U.S., 5 million globally. And you can use a different disease as an example, if you like, but how do you scale that up? What does it look like?

16:17Paul Hastings: That's a wonderful setup question that you didn't realize you set me up for, but you could have one donor that could be a universal donor that can make enough cells for the world. Really? Okay. Population patients, yes. So the concept of an off-the-shelf cell is that this cell therapy is like an antibody. It's like a pharmaceutical. You're not taking blood from a patient, aphericing that patient, and then engineering that blood and then giving it back to the patient. You're taking blood from a donor or a set of donors, and you are making a master cell bank worth of cells that can then reproduce over and over again lots of material.

17:04Paul Hastings: So it's purely off the shelf. So when you come, if you have an autoimmune disease, scleroderma, for example, and you go to your treating rheumatologist and say, and the rheumatologist says, hey, I'd like to put you on the NCARTA clinical trial for scleroderma. You're getting off the shelf cells. You're not being asked to give your blood to be able to then, you know, manufacture your own cells. You're getting cells from another donor. And those cells have already been made and they're ready to dose. All you have to do is show up, thaw the cells, inject the cells. And you could theoretically have one donor that could supply the world.

17:37Paul Hastings: Now, you have multiple donors for different reasons, but no, this is a very rich reservoir, if you will, of cells to be able to make an off-the-shelf, on-demand, ready-to-use therapeutic. Thank you for explaining that. I wasn't sure if it was like a one-to-one donor. I mean, I assume that it couldn't be, but yeah, that's, you know, it does. So the scale - Autologous therapies are one-to-one. The patient comes in, they give you your blood. Right, that's when you're taking from it, yeah. But allogeneic, it's like a regular pharmaceutical. It's off the shelf. I wanted to, I just, you know, there was a cell therapy, allogeneic cell therapy approved at the end of June, Orca Bio.

18:23I think it's intended to help graft versus host disease in blood cancer patients. And I only ask you about this because I wonder if there was anything surprising or instructive about that FDA approval. It's not the same as the candidate that you're developing, obviously, but it has some similarities. I think that yes, absolutely.

18:46Paul Hastings: I and congratulations to Orca for getting that drug approved. and I call it a drug because they are drugs, right? These are cell therapies, but they're drugs. They act and look like drugs, allogeneic ones anyway, not autologous ones, but allogeneic ones. So yes, that's great that that was approved because the recognition, if you will, and the knowledge of cell therapies is sporadic when it comes to the physician community and even some of the pharmaceutical companies that want things that look like pills or injectables, right? And so allogeneic therapies are like an injectable, but there's still some awareness we need to work on.

19:34Paul Hastings: So any allogeneic therapy that gets approved helps everybody else, right? There's some recent data from another one of the companies that has allogeneic NK cells. They're not engineered, but they're allogeneic. Great. The more data that's out there from other companies, the better. The more approvals, the better. Because at the end of the day, where cell therapy is today is where antibodies were 25 years ago. Nobody really knew where these antibodies going. Are they going to become a mainstay of pharmaceutical company development? And they are. I think cell therapy will be the same, but awareness right now needs to be enhanced.

20:11Paul Hastings: And these companies, they're They're buying these in vivo CAR T companies and whatever. You can see that the companies, the big companies are starting to realize that cell therapy works and it works well and it works deeply. It penetrates where it needs to penetrate to get the therapeutic effect it needs to get. And I think ultimately cell therapy is going to be something that people just think of as another antibody, another therapeutic in the armamentarium of even some of the biggest companies in our industry. Gilead, for example, right? Yeah, right. Right. BMS, Novartis, they all have these.

20:45Paul Hastings: Lilly, Genentech. Genentech recently announced, by the way, that while one of their T-cell engagers was being dropped on the portfolio, they have cell therapy and they're excited about it. And I was just telling one of their leadership members the other day at the BioBoard, thank you for saying that because that helps the awareness of the industry to understand why they should be looking at cell therapy and cell therapy companies. Yeah, especially when especially when big companies are saying it. And I was curious about like awareness among the investor community. What is the current funding picture look like for for cell therapies?

21:23I mean, let me ask this a different way. Like what what do early stage cell therapy cell therapy companies need? What do they need to do to survive into late stage development right now? Have good data.

21:37Paul Hastings: I mean, one of our colleagues and competitor companies in the NK space had some recent data, announced the data, raised$300 million, right? So now that company is able to go into pivotal trials and complete its pivotal trials. And the investors who invested in them recognized the difference between the clinical outcome of that company's sales versus other modalities. So investors, not all of them are aware of these cell therapies. Not all of them are interested even in these cell therapies because they tend to go, well, they don't tend to, I can't speak for them. People watch what pharma companies want to do when it comes to the emerging companies in our industry.

22:21Paul Hastings: And they say, if pharma wants this, we'll get behind it. And so the awareness, if you will, of the investment community in cell therapy, it was high when we first started. People were reporting out data, one, two patients, and people were getting all excited. Market caps were going crazy. Now they're wanting to see data and durability of response. And I think that's good for us. And so what companies need to be successful is data, durability of response, good data in more than one or two patients, but handfuls of patients where we're showing some efficacy that's beyond what they're seeing with small molecules, T cell engagers and other allogeneic therapies.

23:03Paul Hastings: I'm sorry, other autologous therapies. Yeah, well, there have been more, I think, autologous therapies. Well, I know there's been more autologous cell therapies approved than allogeneic cell therapies. But I remember, you know, not so long ago when everyone was thinking, you know, allogeneic cell therapies are really, you know, because they're off the shelf, because of the, you know, less complexity and administration that they would sort of lead the way. Do you think that still is going to happen? Do you think there will continue to be a place for both autologous and allogeneic? Or does it matter, you know, if one beats out the other?

23:38Paul Hastings: Well, first of all, we shouldn't be in the business of trying to beat each other out, right? Autologous therapies work and there's data that support that. Good for them, right? So now there are, like with any drug, there are pros and cons of those drugs. So for autologous CAR T therapies, particularly at autoimmune disease, these cells tend to expand over a long period of time and cause things like cytokine release syndrome and neurotoxicities. So the one area where we could provide a benefit over autologous CAR T is if we had a cell therapy that you could give where you didn't get cytokine release syndrome, where you didn't get neurotoxicities.

24:13Paul Hastings: toxicities. And so far in our autoimmune clinical trials, we have none of that, zero, zero incidence. So if we're able to have the efficacy of the fantastic level that autologous CAR-Ts have without having to apherese the patients, without having to put them through that, then we have a home run. But that's yet to be seen with data, with good efficacy, and with durability. And we're behind because these cells came around later. So now we got to show that. So if we can show that, we can be competitive with autologous CAR-Ts. And from my point of view as a patient, I want patients to have access to everything.

24:51Paul Hastings: Autologous therapies, allogeneic therapies, CAR-T, CAR-NK, T-cell engagers, bispecific, small molecules, as long as they all work and patients have options. When have we ever had a situation with an autoimmune disease where patients had four or five options that they could do? And if they become resistant to one, they can go on to another. Never. So now we have that opportunity. And that's what I'm excited about. I want to get back to your comment about clinical infrastructure, Paul. And, you know, given your experience, active participation in the industry trade organizations, I wonder what maybe what you could say about the state of innovation broadly in the U.S.

25:34and in terms of kind of what's going right and what's going wrong. And also talk to me about, you know, problems with clinical infrastructure and how they might be fixed.

25:45Paul Hastings: What is going right right now is that as a nation, we are recognizing that while we had the state-of-the-art clinical trial infrastructure for many, many years, we're losing it to China. Okay, that's number one. And we have to admit that. They're kicking our ass, all right? They're able to enroll multiple patients in clinical trials very quickly, report on our results. Why? Because they're focused on it. We lost the focus on clinical trial infrastructure. We got caught up in punishing academic centers for making political statements, taking away their funding. And so the clinical trial infrastructure is strained.

26:26Paul Hastings: And when that infrastructure is strained, patients don't get enrolled. Results don't happen quickly. We burn through hundreds of millions of dollars to do clinical trials. So it's not the academic institution's fault that right now the clinical infrastructure needs upgrading. but it does need upgrading. One way to do this, in my opinion, is to start working with community-based centers in disease areas where patients live in communities. So rather than have to send 95 % of the patients that don't have access to New York or Boston or Philadelphia or Chicago to those cities, is to have community-based centers in their areas that actually can conduct clinical trial research.

27:09Paul Hastings: And when you hear from big academic centers that these small institutions can't do it, I don't buy it. I'm looking at centers now in the community that can do everything as well as the big centers, but what they do better than the big centers is understand who the patient is because it's their patient. It's the doc in that institution or in that clinic that know that patient because it's part of their practice. So if you can supplement the academic infrastructure, which tends to be big and bureaucratic and sterile, with more community-based centers where they're actually focused on treating their own patients, I think you then have a one-up on other countries who are trying to do this.

27:53Paul Hastings: And you're going to be able to find patients where they live, treat them where they live, provide services for them where they live. like the simple, when you look at what it costs to do a clinical trial. In cell therapy, it's multiple hundreds of thousands of dollars per patient to enroll them in a clinical trial. So you could spend maybe$20 ,000,$50 ,000 on a patient by providing childcare services, doggy daycare, fertility services for them, travel to and from the site, travel for their spouse. right? These are infinitesimal costs that you can do to make it easy for them to get to those clinical trial sites in their communities or in those big academic centers.

28:36Paul Hastings: We do that now. It's a small cost compared to the rest of the cost of the clinical trial. But by making the clinical trial infrastructure patient-friendly, so when the patient walks in the front door of the institution they're going to for their clinical trial, the person at the front desk, when the patient says, I'm here to enroll in my clinical trial, doesn't say, what clinical trial? They say, oh yeah, I know that. Here's where I'm sending you. Go there, get your lab stud here, then go there. We're going to help you every step of the way. That's what companies need to do. That's what institutions need to do.

29:08Paul Hastings: And it's the company's onus to own that process and make sure that happens for the patient so they're not floundering about trying to figure out where their clinic is, where they need to get their treatment. Because again, patients are giving up portions of their life to be involved in clinical research for us. So we have to own it. We got to work with them. We got to help them. We got to make this a process that is friendly to them so that they want to be involved in clinical trials. That's what we need to do to make our clinical trial infrastructure better in this country. And this is companies supporting these community center providers and community centers to actually conduct trials or helping provide patients what they need to actually get to where a trial may be happening or both?

29:53All of the above.

29:55Paul Hastings: Yeah. All of the above. So the one thing I will tell you that I always say to early stage CEOs and I chair companies and boards of companies of early stage CEOs is details matter. You know, this concept of servant leadership where you get out of the way and everybody just does their job and you trust that everyone's going to do the job, which of course you should trust people do their job. But you need to be hands-on and you need to know who's the investigator in my trial, who's the administrator of the hospital that the investigator works in. So, if something goes wrong, you know what's happening and you can get in there and try to fix it.

30:30Paul Hastings: And there are some institutions that don't have study coordinators. Provide non-restrictive grants to those institutions so that they can actually get a study coordinator. It's an infinitesimal cost compared to the whole cost of the trial. And it helps the institution, It helps the PI as long as it's done the correct way legally and within the boundaries of clinical trial ethics. And it all can be done. So many things can be done that people have said, no, no, you can't do it that way. Well, you can. You can actually reimburse patients for the amount of time they lose at work to go into a clinical trial.

31:06Paul Hastings: But nobody wants to go there. Everyone's afraid of that. But you actually can do it legally and within the confines of good clinical practice. So, you know, if you offer those things to patients and say, we're here for you, well, now they trust the institution of a clinical trial versus not trusting it. Their own community doc is the one administering therapy. So they trust the community doc. So it's, again, looking at this from the eye of the patient. Yeah. And maybe that community doctor is key because there was a lot of excitement several years ago about Target, Walgreens. I think even Walmart was proposing conducting clinical trials.

31:45And their whole thesis was, we already have these retail customers. We know them. We can get them into clinical trials. It didn't really work, though. But I think maybe it's because those, you know, talk about sterile. It's a different type of organization than a community doctor who may know not just the patient, but their family as well. Well, patients are people.

32:10Paul Hastings: People go to Target. People go to Walmart. People go to Costco. Right? So people get there. By the way, these glasses came from Costco. I get my eyes examined at Costco every year. Why? Because it's a third of the cost of going to a freaking optometrist in the Castro where I live. If it's going to charge me$1 ,000 for a pair of glasses, when Costco charges me 25 bucks or 100 bucks or whatever it is. So I think the consumer is the customer. People need to understand how to work that. And I remember when the business of pharmacy started going from these mom and pop retail stores into CVS, Walgreens, et cetera, and then into Target and Costco.

32:50Paul Hastings: Remember, who is it important to be serving here? Is it our profession? No, it's the patient who's a person. Where do they go to get the things they need for their week, right? They go to these big box stores to get their groceries, to get their pharmaceuticals, to get whatever. So as a pharmacist, if you're working inside a Walgreens or a Target or a Costco, why not, right? You can build a pharmacy there. You can have a one-stop place for patients to get all their needs. And so why not, right? Whatever makes it easier for the patient, as long as it's done within good pharmaceutical practice, good clinical practice, and people in the profession have great jobs there.

33:38Paul Hastings: They're treated well. By the way, Costco and other of these big corporations are diversity, equity, inclusion specific. They're still doing a lot of work there and they're treating their employees well. Why not? Yeah, except for Target. I think they've backed off some of that a little bit. Well, they've backed off. Well, yes. Well, look, we can get into this whole subject of what I think corporate leaders need to do, which is speak up. Yeah. But, you know, when I see people backing off, I lose confidence in those. Yeah. Right. So if I see the store that I go to backing off of what is important for people in this country, I'm going to go, wait a minute, Costco's still doing it.

34:22Paul Hastings: I'm going to go to Costco. So it's supply and demand, right? It's supply and demand, and it's consumerism. So you think there is a potential future then to conducting some clinical trials in big box stores like that? Well, I don't know that you can actually do a clinical trial, but you could certainly – I mean, wouldn't it be great when patients have to go in for a bloodline? If they could do it at Costco. Right. I mean, you can you can get your flu vaccine. I get your blood work done there. They can hire a lab tech. Right. All these like quest and all these diagnostic places. They're just little box stores inside clinical, you know, clinical centers.

34:58Paul Hastings: So you could put one in a in in a retail pharmacy. Why not? I definitely do want to get your advice, Paul, on what biotech leaders should be doing and how they can speak up. and, you know, what they should be speaking up about. And maybe a way to get to that is your stint as as bio board chair a few years ago. I'm curious, you know, what you maybe learned from that job or what the hardest part of that job was. Well, to be clear, it wasn't a job. It was a volunteer. By the way, yes, being on the board. I'm sure it felt like a job. Yeah, it does. It does feel like a job. Yes. But it's a commitment and it's a responsibility.

35:39Paul Hastings: In my opinion, this industry gives to us, we need to get back to the industry. And if you could be the head of the trade organization, the chair of the trade organization that helps the industry do what it needs to do and keep itself relevant, I think that's a good thing to do. So I believe these things are an obligation, not just a volunteer activity. So what I learned from being chair of bio and what I continue to learn being on the board of bio is what is important to our industry? What are the important aspects of education on the Hill? You know, making sure that our senators and Congress people are up to date on what we do, that they understand our industry, that they're getting appropriate messaging of what our industry is, not hearsay from others.

36:27Paul Hastings: One area that we all need to speak up against are these so-called pharmacy benefit managers. What are they providing to our ecosystem besides nothing other than being a middleman, right? So I do believe that as leaders, we have to take a stance. While we're being attacked by other industry organizations, we need to make sure that we are transparent about the way the pharmaceutical infrastructure and innovation infrastructure works. And part of that is, unfortunately, making sure that people know that a PBM is taking large percentages off what the insurance companies are paying for products and not giving it back to the patient.

37:10Paul Hastings: I think that's really important to know that. I think it's really important to understand what HHS and FDA and Department of Homeland Security and all the other groups within the administration are doing to and with and for the people who are our employees. Right? So we're an ecosystem of innovation. If we're going to continue to have an ecosystem of innovation, it's probably important that we have an opinion about immigration. It's probably important that we have an opinion about people who come here to be educated and keeping them here versus sending them back to their countries like China to take what they learned here and just replicate it there in a much more efficient manner.

37:52Paul Hastings: So we should have opinions about that. We should work on that. We should be collaborative and cooperative in doing so, but we should be honest about how we feel about that and make sure that our voice is heard in D.C. and make sure that the people's voice and the patient voice is heard there as well. So not speaking up to me is cowardice and speaking up to me is an obligation. What's the best forum for speaking up? I mean, is it is individual CEOs, you know, doing like going on television, writing op eds? Should it be more behind the scenes, direct to, you know, folks in power at the federal level?

38:29Like, what do you think is the most effective way that that leaders in the life sciences industry can speak up on some of these issues?

38:38Paul Hastings: Well, going to the going to a fly in on the hill is not, you know, behind the scenes. It is very up front and center. So I want to say that. Right. So, I mean, you know, that's important. All of the above is important. Right. It is – I'm not going to compromise my standards or my ethics or pay to play for anything. I'm going – by the way, I contribute to no PACs. I contribute to no – well, I do contribute to some politicians. But I want to see what people can do and that they're doing the things that I think are important, that my spouse thinks are important, that we believe is the right thing to do before I give them a penny.

39:21Paul Hastings: So I like moderation and I like the ability to negotiate and work with the other side in the middle, not the far left or the far right. So I just think it's our obligation to do all the above. So by the way, you don't need to be on CNBC or MSNBC or, you know, heaven forbid, Fox News or anything like that. What you need to do is if you're asked, if you're called on to have an opinion, to have a goddamn opinion, right? And actually speak what you think and speak your mind and do it in as kind and gentle a way as possible by getting your point across what's important to you, what's important to your employees and why it would benefit people to do X, Y, or Z.

40:06Paul Hastings: So I think it's an obligation. And I think all of the above of what people should be doing, hiding and not having an opinion about something. Why be in leadership if you don't have an opinion about something? Right. That's my opinion. Yeah. Yeah. I mean, I think that the only rebuttal I could potentially see from leaders as well, you know, I don't want to jeopardize, you know, my review at the FDA. I don't want to say something, you know, that and of course, that should never happen. And obviously, you know, speaking, you know, an opinion about an issue should never change the science of an FDA submission.

40:42But I mean, I sense that there is some people had people had those fears.

40:47Paul Hastings: And and again, it is up to us to hold our politicians accountable for that. Like we shouldn't have to have fears about if we don't like what Homeland Security is doing, that should not affect how our interactions with the FDA are. And I'm not seeing that in my interactions. Yeah. So, you know, I'm seeing an FDA that likes cell therapy, that likes innovation, and that's working with us. I don't bring up to the FDA what I think about Homeland Security. You know, I don't bring up with Homeland Security what I think about the FDA. I think each one of these departments or ventures or whatever within the government needs to be dealt with separately and objectively and with an objective lens.

41:30Paul Hastings: And so, yeah, I think to say I'm not going to support my employees because I'm afraid of retribution. I mean, really? So, by the way, anything we do as leaders, there are repercussions one way or the other. So, we either take a stance or we're not going to take a stance. But if we don't take a stance, are we really the right people for the job? I don't know. I don't think so. So, yeah, I just to be a leader, right? It's a privilege to be a leader and you have to you got to you have to play. You have to pay to play if you want to play and be a leader. And and and you people are looking to you to help lead, not follow.

42:10I want to ask you about a couple of the groups that I mentioned in the introduction, Paul. But before I do, before we leave the FDA, my sense and you can correct me if I'm wrong on this, is that there's been some stability now. Just in terms of personnel with Kyle Diamantis in the acting role and Kareem McHale as the acting head of CBER. I won't ask you specifically about those two gentlemen, but what about current policies at the FDA? Or are there any that that you're watching carefully or that that you're concerned about or that you think, you know, the FDA needs to adopt yesterday?

42:52Paul Hastings: All of the above in terms of watching initiatives. Okay. And I am encouraged by the fact that the gentlemen that you just mentioned are focused right now on making sure that we can put a drug into development and get it approved in as efficient way as possible. So I'm encouraged by that. How they go about doing that, jury's out. We got to wait and see what happens, right? I do know that one of the areas they're working with is academia to help speed up clinical trials. And to me, that's an oxymoron. Academia slows down clinical trials. We need to figure out a way to help academia speed up clinical trials.

43:29Paul Hastings: So that's a good initiative. But looking to them for solutions on how to make clinical trials faster, to me, it's a little bit backwards. So I would look at community centers and community docs and say, how do we get these trials done? How do we get them done in an efficient manner? How do we make it easy for patients to have access? So I hope they focus on that and I believe they are. So I think where they're trying to go is a good place. They're big. They're bureaucratic. They have to learn how to act like a biotech company, if you will. If you want to do what China is doing and enroll patients quickly in an efficient, effective, and ethical manner, I don't know that China is doing it ethically or not.

44:07Paul Hastings: But I don't see any reason to believe they're not. But if you want to do all those things, you've got to think like an entrepreneur. And I think there's a focus there on doing that and making it an efficient organization that I'm very pleased with. So what about. Yeah, sorry. Go ahead. No, go ahead. I was just going to say, what about integrating AI into the FDA? And in Carta, is AI something you're leaning into at the FDA? Do you think AI is a kind of key plank toward modernization? How are you thinking about AI? AI is a tool in our armamentarium of tools. Yes. All right. Well, we'll leave that one there.

44:47I honestly don't want to get too deep into that myself. But I do want to ask you about the Termir Institute, which I believe you co-founded, I think, in 2023 or 2022. Is that correct? I did not co-found it.

45:02Paul Hastings: It was founded by Henry's wife, Belinda, and she built the organization and I'm a member of its board. But I'm very excited about what the Tumir Foundation does because it speaks to your audience. It speaks to first time entrepreneur CEOs and how do we provide an environment for them to succeed. Okay. So it's like a leadership training kind of organization. Is that what it's focused on? It's a peer-to-peer leadership mentoring organization. That's right. So we have these quote-unquote Tremere Fellows. They apply for fellowships within the Tremere Institute. And then I become a mentor as a board member.

45:42Paul Hastings: There are other former Genzyme employees and former people that were friends with Genzyme that are mentors to these first-time CEOs. And we help them through some of the issues they have. They have someone to call and say, hey, I'm facing this. What do you do when you face that? So it's a little bit like being board members of all these early stage companies, but you're actually helping them. And the institute provides grants to these people for some of their own research and some of their own development. And a lot of these first-time CEOs are people who came up with an idea in their postdoc or in their academic institution who then decided to start a company.

46:16Paul Hastings: Some of them are just first-time CEOs that realize it'd be great to have some mentorship and to be part of an organization where there's a whole bunch of first-time CEOs working together and socializing together and learning together. And so it's a wonderful, wonderful thing to do. And it's got some great names behind it, like John Maragonori and Deborah Dunzire and just some really great people that are very successful biotech CEOs that are working together to make sure that the next generation of biotech CEOs has the same opportunities that we had. Just give him back. That's excellent. The other organization I wanted to ask you about is No Patient Left Behind, which I believe was started by the investor Peter Kolchinsky five or six years ago.

47:06What are they up to? What are you doing with that organization?

47:10Paul Hastings: I'm an advisor to No Patient Left Behind. I'm a proud advisor to No Patient Left Behind. I'm a very big fan of Peter Kolchinsky because the man cares. He steps up. He has an opinion. He speaks up. Yeah, he does. He speaks up, and he fights for the patients, and he fights for no patient left behind. I mean, that was his idea. So he's got a great staff there that works at No Patient Left Behind, and I help them wherever I can. They're a mini trade organization, basically. They're really their sole mission is that no patient is left behind, that we are actually looking out for the patients. And and so they have an opinion about what patients have access to.

47:51Paul Hastings: And so working with them, it's been a pleasure. I'm going to continue to work with them. And Carta is a member of No Patient Left Behind. You can, you know, pay membership dues and and be a part of the organization. And I think it's a great organization to be a part of. I'm running out of time with you, Paul, as I suspected I would. So I'll just get one last question in here for you, which is what are your top goals for the rest of 2026? It could be goals for Encarta, for the industry at large or personal goals. I'll let you decide. Yeah, well, data, data, data is my goal for for 2026. And to make sure that whatever data we present leads us to take our company to the next stage.

48:35Paul Hastings: That is the number one priority of my personal agenda, of my professional agenda, and my industry agenda for this year. Other things are making sure that we have an FDA that listens to its constituents and does the right thing for patients. And I'm encouraged by what I'm seeing so far. And that we have a Congress that is understanding of our industry and is also speaking up for their constituents, which are the same people that are our constituents that are our employees, right? So those are the sort of the three top things that I'm looking to do this year. Excellent. Well, we'll have to leave it there.

49:16Thank you so much for coming on the show, Paul.

49:18Paul Hastings: It's a real pleasure speaking with you. My pleasure, Ben. Thank you. As a side note to listeners, Paul is part of an all star live panel that Life Science Leader is hosting. And I'm moderating on August 20th at 11 a.m. Eastern. Paul will join Ovid Therapeutics, Jeremy Levin and Bios Senior Vice President of Science and Regulatory Affairs, Annette Beauregard, to talk about FDA engagement strategies and best practices during a time of rapidly changing FDA personnel. and policy. Listeners can register to join that event for free on the Life Science Leader website, or you can look for my post about it on LinkedIn.

49:57For Business of Biotech, find us and subscribe anywhere you listen to podcasts, and be sure to check out our weekly video cast of these conversations every Monday under the Business of Biotech tab at lifescienceleader.com. We'll see you next week, and thanks as always for listening.

50:22We'll see you next time.