Being in charge of a health care company during a pandemic is a ton of work — just ask Eric Hobbs, CEO of Berkeley Lights, who met with 180 investors over Zoom over three and a half days — and lost 10 pounds over the process.
You don’t have to go on a virtual roadshow to work tirelessly in the drug business nowadays. Major drug companies are racing to develop a Covid-19 vaccine. But Hobbs says it won’t be easy to come up with one that works right off the bat.
In an exclusive interview with CNN Business, Hobbs said that the probability of success with any drug is around 4% and that there probably needs to be at least 20 to 25 viable vaccine candidates in the works to ensure that one truly works.
“All this money is being dumped in but there is a low chance of success and high costs. The world is learning how hard this is,” Hobbs said.
Hobbs’ company is working with AstraZeneca as well as the US Department of Defense and Vanderbilt University on Covid-19 vaccines. Berkeley Lights also counts Amgen, Pfizer, GlaxoSmithKline and Bristol-Myers Squibb as large customers.
One of Berkeley Lights’ main products involves using what is known as opto-electropositioning (i.e. light patterns) to help move individual cells so they can be looked at to see if antiviral medications or other drugs are having the desired effect. The technology was developed at UC-Berkeley.
That’s why the company has the somewhat unusual name of Berkeley Lights, which Hobbs conceded sounds like a brand of cigarettes. (There is, in fact, a Berkeley brand in the UK.)
Hobbs told CNN Business he is hopeful that there will be a vaccine soon. But he expressed caution.
“If a vaccine is not good enough, you cant build up immunity. I think we’re getting to a point where there’s a good set of clinical candidates,” he added. “But the world cannot take its foot off the gas pedal until we have an approval — and even then not until levels of immunity are high enough to ensure that the world’s population is safe.”
Berkeley Lights, which went public last month, is benefiting from Wall Street’s insatiable appetite for health care initial public offerings. Investors are eager to buy shares of new companies that are helping treat Covid-19. The company’s technology is also being used in cancer treatments and drugs for inflammatory diseases and other infectious diseases, Hobbs said.
Shares of Berkeley Lights more than doubled on their first day of trading and the stock is currently up nearly 165% from its offering price.
The company’s shares soared despite the fact that Hobbs describes himself as a more introverted type of person. He didn’t do the usual business news media blitz the day the stock debuted.
Meeting with hundreds of investors via Zoom
“The IPO was just a fundraising event. I’m super interested in running the business,” Hobbs said. “It didn’t occur to me to be on TV. I also like being humble — which is not a terrible thing to be.”
Nonetheless, Hobbs made himself available to meet with prospective investors in a marathon virtual roadshow.
Executives of companies looking to go public typically travel across the country to hold meetings in various cities with people from big mutual funds, pension funds, hedge funds and other large money managers to try and convince them to invest in the stock. Needless to say, this was a no-go due to Covid-19.
So Hobbs did Zoom calls from home instead, waking up at the crack of dawn on the West Coast to start chatting with people on the East Coast.
“Most of the calls were one-on-one. I’d Zoom from 3 a.m. all day and then pass out,” Hobbs said. “My kids would crawl in to the room and give me food. I’d pound fluids like I was running a marathon before getting back to calls. I lost 10 pounds during the process.”
Hobbs said doing the roadshow this way was a phenomenal experience. And once the stock began trading, Hobbs said he rang the bell at the Nasdaq virtually from his living room with his wife, three kids and dog.
This may be the new reality for companies planning to go public until there is a vaccine.
Mike Pykosz, CEO of Oak Street Health, a company that runs a network of primary care centers for Medicare beneficiaries, told CNN Business that he did nearly 45 individual meetings virtually and a couple of group chats. He joked that he didn’t lose weight since he was sedentary and eating more.
Oak Street Health shares also surged in their debut, rising about 80%. Pykosz said investors seem to recognize that companies helping to deal with this health crisis will be in strong demand.
The company may not be involved in developing vaccines, but Pykosz pointed out that its patients are all seniors who are on Medicare. Nearly 90% of the patients they treat have two or more chronic diseases.
“We’re seeing older adults with moderate to low incomes. They are more at risk,” Pykosz said, adding that the company has quickly ramped up its telehealth capabilities and is now using vans that it previously had to take patients to its health centers to instead deliver food to needy patients.