11
SIRTRIS, MASTER VOYAGER OF THE VORTEX
FACING THE CHARLES River between Harvard and MIT, the Polaroid Corporation’s former headquarters in Cambridge, Massachusetts, has the kempt, desolate air of a landmark whose significance has faded from living memory. The techies flashing by its art deco façade en route to the next big thing are too young to have witnessed the tale of hope, genius, and hubris that unfolded here as Edwin Land’s instant-photography concern rose to glory in the 1960s, then lost its way in the digital age and tottered into bankruptcy. But the moral of Polaroid’s story—never stop looking anxiously over your shoulder—was very much on the mind of Sirtris Pharmaceuticals CEO Christoph Westphal as he strode past Polaroid’s vestige in late 2006 on his way to work. As usual, he was commuting by foot from his home a mile and a half away—walking met his inner need to press forward at all times.
Westphal had begun the year with high hopes for negotiating a partnership with a pharmaceutical company that would pump millions of dollars into his biotech for rights to its early-stage medicines. But nothing had come of a series of visits by big pharma envoys during the spring and summer. More worrying, GlaxoSmithKline, the industry player that had shown the most knowledge and excitement about Sirtris’s research, had stopped talking to it about a possible deal, suggesting that it planned to compete rather than collaborate. Westphal didn’t need to look over his shoulder to see the looming competitive threat. Sirtris had a head start in developing sirtuin-based medicines, but the pursuing giant’s long shadow extended well out in front of it.
Asserting its edge, Sirtris had begun clinically testing its first drug less than two years after opening its doors. Dubbed SRT501, the medicine contained resveratrol in a form designed to get more of the compound into the bloodstream than existing dietary supplements did. The biotech had also aggressively ramped up research on novel SIRT1 activators far more potent than resveratrol. But trying to stay ahead of rivals many times its size was turning Sirtris into a cash bonfire, and it needed to raise a lot of money in the near future.
Westphal is a tallish, solidly built man with closely cropped brown hair and a disarming, jocular manner—at first glance you can readily picture him as the wisecracking high school halfback he never was. His quickness in conversation tells a more accurate story. He tends to see where you’re headed before you get there, and I’ve sometimes found that my verbal exchanges with him taking on a staccato, Twitter-like quality, as if we were both frantically trying to extend life on the cheap by packing more into the time allotted.
Bounding into Sirtris at seven-thirty, he walked into the office of the vice president of finance, Paul Brannelly, and immediately began hashing out details of Sirtris’s recently hatched plan to file with the Securities and Exchange Commission for an initial public offering of stock. If all went well, the IPO would provide Sirtris with enough capital to demonstrate signs of efficacy in clinical studies with SRT501, a critical milestone. Talking fast, Westphal seemed to have forgotten that he was still wearing his coat and fleece stocking cap. There was something else he’d apparently overlooked, a matter of somewhat greater significance: Sirtris was at an absurdly early stage to go public.
Only a few months earlier an article in the Wall Street Journal had highlighted the withering skepticism biotech start-ups were facing when trying to sell stock to the general public. “These days,” the article starkly noted, “few investors will even look at a biotech IPO unless the start-up has a drug candidate in late-stage testing, meaning it might be only a few years away from possible regulatory approval.” A number of young biotechs had been forced to cancel planned IPOs, and others had accepted miserably little for their shares. When Westphal first told Sirtris’s board in mid-2006 that he planned to move quickly toward an IPO, he recalled, “they told me I was absolutely insane.”
But he’d always maintained that Sirtris was special, and evidence was mounting that he was right. A month earlier, the famous mouse study led by Sirtris’s founding scientist, David Sinclair, had appeared, showing that resveratrol could render the rodents largely immune to the health fallout from rich diets, boost their exercise endurance, and perhaps even mimic CR’s anti-aging effect. The resulting hullabaloo had made Sirtris the most celebrated early-stage biotech since the genomics craze of the late 1990s. When I visited Westphal soon after the study was published, he commented that “there’s a funny thing about this company—it’s the first biotech I’ve seen where half the board wants to take the drugs it’s developing.”
Sirtris had another asset that set it apart: Westphal himself. Before cofounding Sirtris in 2004 at age thirty-six, he’d been one of the most prominent young venture capitalists in the country. He’d cobbled together five high-flying tech companies in five years, including two biotechs that had already reached a stunning combined market value of more than $1.3 billion. Given his track record, people tended to pay attention when he described Sirtris as his entrepreneurial pièce de résistance. As he told me in an e-mail, his standard line to potential investors in Sirtris was that he’d quit his meteoric VC career to lead the company because he was convinced that it represented a “once in a lifetime chance to change medicine and improve society.” He actually seemed to mean it.
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Westphal showed his entrepreneurial flair at about the same time of life Tom Sawyer did. His parents, natives of Germany who have spent most of their lives in the United States, remember him before age ten as a quiet, bookish youngster. While his toy train set gathered dust, he plowed through history and other nonfiction books, once even reading the dictionary from A to Z, recalled his father, Heiner, a geneticist and lab director at the National Institute of Child Health and Human Development.
But around age eleven his inner capitalist boldly asserted itself. After arranging to mow the lawns of various people in his neighborhood, he enlisted friends to do the work and took a percentage as manager. As a high schooler, he began earning returns on the cello lessons he’d dutifully taken since age six—he’s an accomplished player—by organizing a string quartet with friends that played classical music gigs in restaurants and other venues. (It was the first of three quartets he assembled during his student years.) While spending a summer in Germany as a teen, he used three thousand dollars saved from the lawn-mowing business to buy a clutch of popular name-brand suits that he’d heard were scarce in the United States; he shipped them back in his cello case and made a handsome profit. The instrument came home in a cheap bag.
After graduating summa cum laude from Columbia in three years with a triple major in economics, literature, and biology, Westphal went to Africa for nine months on a Rotary Scholarship. Ostensibly working with a medical team and studying in Cameroon, he spent much of the time rambling around the continent as if it were a giant dictionary to be read cover to cover. To his mother, a physician, it was the vicarious year of living dangerously. “He was always very convincing,” she drily recalled, “when he told us over the phone that his school in Cameroon was closed for some reason, so he had gone to Chad or some other country that he would describe as this wonderful, safe place. Then we would wait and pray for the next call.”
No telling where it would come from—he was in all-out Kerouac mode, cramming life skills and getting, in his words, “really grounded. I was living in rooms with dirt floors, without running water, without electricity, and I was very happy. It helped me understand what the world is about.”
He also found himself in “some seriously scary situations. One time I was walking along the bank of the Congo River and these guys came at me with guns drawn, saying they were government agents. They took me into a car, and I thought they were going to kill me. But they just wanted to rob me, and took my money.
“I think traveling around Africa in your early twenties with nothing but a backpack is good preparation for being a venture capitalist. You’re on your own and you have two minutes to size up this person who’s approaching you in the street at night in Kinshasa. Do they want to kill you, or do they want to help you? What’s your judgment?”
Post-Africa, he polished off two Harvard doctorates in near record time, about six years. While getting his Ph.D. under renowned geneticist Philip Leder, he somehow found time to serve as lead author on a half dozen studies, including ones published in prestige journals such as Cell. He slogged through an M.D. on the side—he’d once pictured himself leading a life like Albert Schweitzer’s but then realized he hated the regimentation of medical practice. The best thing about going to med school, he told me, was that it brought him into contact with his future wife, who at the time was earning a Harvard Ph.D. in biology. It also led him back briefly to Africa, where he worked at the Albert Schweitzer Hospital in Gabon for three months after getting his degree—he got a lot of practice delivering babies, and later he delivered his own kids.
Next he spent two years at management consultant McKinsey & Co., then joined Polaris Venture Partners in Waltham, Massachusetts, to take up his true calling, starting companies. He honed his management skills during his five years at Polaris by serving as founding CEO of four of the companies he launched, including Alnylam, which became one of the hottest biotechs of the early 2000s.
Soon after the publication of Sinclair’s 2003 report on resveratrol’s life-extending effect in yeast, Westphal met with the Harvard researcher to discuss starting a company. They didn’t immediately hit it off. Westphal nearly walked out when the scientist refused to disclose proprietary details of his work.
But Sinclair enjoyed verbally sparring with the VC, who asked all the right questions. Westphal was clearly intrigued by the promise of sirtuin-based CR mimetics. Sinclair’s showmanship also impressed him, and he correctly guessed that when it came to selling the sirtuin story to investors, the scientist would pull more than his weight in gold. Although Sinclair had earlier planned to start Sirtris with another group of high-tech entrepreneurs, he soon decided to join forces with Westphal. In spring 2004 the two jointly began making the rounds at Boston-area VC firms soliciting funds for Sirtris’s first financing round, which Westphal’s VC firm was set to lead.
It was a harder sell than they’d expected. In the wake of the high-tech crash that began in 2000, VCs were more acutely aware than ever that early-stage biotechs face about the same odds Evel Knievel did when revving his Skycycle to jump the Snake River Canyon. (He didn’t make it.) It didn’t help that Sirtris would be an offshoot of anti-aging research, still widely seen as borderline quackery. “People were telling me this is crazy, this won’t work, and we’re not sure about Sinclair’s science,” Westphal told me. Still, some of the VCs they approached were very taken by Westphal’s willingness to accept a huge pay cut by quitting Polaris to become Sirtris’s full-time CEO—it was a form of walking the talk that the financiers found both utterly compelling and morbidly fascinating.
In August 2004, Sirtris was launched with a $5 million investment from Polaris and three other VC firms. Westphal’s mentors at Polaris weren’t happy when their star protégé resigned, and because their firm was Sirtris’s main backer he felt like a wayward son forced to borrow money from a father he’d seriously pissed off. But he never looked back. He and Sirtris’s first few employees set up shop in a Waltham, Massachusetts, office that was “so small we took out the doors because we couldn’t shut them and all sit down at the same time,” he recalled. “When the weather got cold, we were wearing Polarfleeces, sitting next to space heaters. If our investors had walked in, they would have thought we’d set up a shell company.”
As promising preliminary data from Sinclair’s resveratrol study in mice rolled in, Sirtris raised $27 million from VCs in early 2005. (That made VCs’ total bet on the biotech $45 million, including $13 million in late 2004.) The company moved to larger quarters in the building next to Polaroid’s former headquarters. Westphal’s new office, which he shared with Sinclair, who served as a scientific adviser and board member, had all the roominess of a walk-in closet. There was a door too.
From the start, Westphal kept Sirtris at a safe remove from the anti-aging quest’s shady side. His first step was to add a glittering list of names to Sinclair’s as scientific advisers, including Nobel laureate biologist Phillip Sharp (MIT); gene-cloning pioneer Thomas Maniatis (Harvard); world-leading biomedical inventor Robert Langer (MIT); and Thomas Salzmann, formerly executive VP of Merck’s research labs. With such eminent scientists on board, he had no trouble hiring prominent academic experts on sirtuins as consultants. One of the few he didn’t sign up was MIT’s Guarente, who at the time worked with Sirtris’s crosstown rival, Elixir Pharmaceuticals.
Westphal also brought in a prestigious board, including hedge fund manager Rich Aldrich, who had helped build Vertex Pharmaceuticals into a biotech powerhouse; M.D.-Ph.D. venture capitalist Stephen Hoffman, founding CEO of Allos Therapeutics; Richard Pops, then CEO of Alkermes, a Cambridge, Massachusetts, biotech; and biologist Paul Schimmel at the Scripps Research Institute, cofounder of half a dozen biotechs.
A number of biotech start-up artists besides Westphal might have lured a similarly impressive set of advisers and backers. But only the rarest of entrepreneurs could have managed to get so many big egos and potentially conflicting agendas pulling together in a single direction with maximum force for nearly four years, as he did. When I asked him how he did it, he grabbed one of the few books he keeps in his office, on abnormal psychology, and loaned it to me. I thought he was joking. But while poring over it, I noticed that it tended to fall open to the pages on narcissistic personality disorder, as if that part had been frequently consulted.
In any case, it’s arguable that the main ingredient of Sirtris’s early success—which set up its emergence as gerontology’s most successful spin-off—was simply that Westphal, for all his relentless drive and formidable intellect (did I mention that he’s fluent in four languages?), can charm the socks off a Gila monster. While sitting in on dozens of meetings at Sirtris between 2006 and 2008, I was struck by the fact that he didn’t suck all the oxygen out of the room, as many charismatic leaders are wont to do. One reason, it seems, is that he’s possessed of, and by, a strong sense of the general irony of things (think of Germans like Günter Grass and Heinrich Böll), which often prompts him to step back and poke fun at himself. When a local TV news team arrived in early 2007 to interview him and others at Sirtris, for instance, he couldn’t resist donning a white lab coat and safety glasses before going on camera, a goofy affectation (the CEO hasn’t done lab work for years) that caused much mirth at the company. “We’re in trouble if we lose the ability to laugh at ourselves,” he said when I asked what had come over him.
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By mid-2006 Westphal had installed a set of high-octane managers, and Sirtris was hitting on all cylinders. One of his first hires had been Jill Milne, a dogged, exacting former Pfizer researcher who was leading the hunt for novel SIRT1 activators—the better-than-resveratrol drugs Sirtris hoped to turn into patent-protected medicines. In 2006, she was joined by Mike Jirousek, a lean, intense biochemist who resigned as head of a large drug-discovery group at Pfizer to lead discovery at Sirtris.
Garen Bohlin, an unflappable former Wyeth executive, signed on as chief operating officer. He played Scotty to Westphal’s Captain Kirk when it came to the budget. (“I’ve giv’n her all she’s got, Captain, an’ I canna give her no more.”) Michelle Dipp, a buoyant, Oxford-educated M.D.-Ph.D. from Texas, led business development—known at Sirtris as “General Dipp,” she quickly emerged as a Westphal-like wheeler-dealer. Biotech veteran Peter Elliott directed clinical testing. A charming native of Wales whose office abounded with sheep figurines, Elliott was known for codeveloping an important new cancer drug, Velcade, at Millennium Pharmaceuticals.
The fact that a clinical expert of Elliott’s stature had joined Sirtris underscored one of its major advantages: It was in a position to test medicines in humans much earlier than most biotech start-ups. Resveratrol, the main ingredient of SRT501, had been ingested by humans for thousands of years with no known ill effects. That didn’t guarantee that the large, concentrated doses Sirtris planned to give patients would have no side effects. But it did mean that SRT501 could be classed as a dietary supplement, obviating the need for lengthy preclinical testing before trying it in people.
When Sinclair had first started thinking about Sirtris, he decided to focus initially on developing diabetes drugs—pursuing anti-aging pills was obviously a nonstarter. (Recall that the FDA does not consider aging to be a condition warranting treatment.) Given resveratrol’s apparent lack of toxicity, SIRT1 activators seemed likely have fewer side effects than existing diabetes drugs, giving Sirtris a major competitive advantage.
By rapidly initiating a clinical trial with SRT501 in diabetes patients, the company made itself interesting to investors who generally avoided early-stage biotech. That was one reason Westphal was able to turn it into a liquidity-fueled rocket that left rivals behind in the sirtuin space race. But SRT501 was just for starters. The main pay-load was to be Sirtris’s novel SIRT1 activators, which were expected to be more effective than SRT501 and, just as important, to provide Sirtris with “composition of matter” patents that could be licensed to big-pharma partners.12
The biotech was playing an especially high-risk game, though. Even if SIRT1 activation could ameliorate diabetes—a big if—SRT501 might not get enough of the drug into humans’ bloodstream to yield signs of efficacy. The resulting clinical failure would probably say little about the general value of sirtuin-based drugs, and Sirtris’s more potent SIRT1 activators might well overcome the problem. But a failed “proof of concept” trial with SRT501 could easily scare away investors and send the Sirtris rocket tumbling end over end. And ramping up clinical trials so early would test Westphal’s money-raising skill as never before.
Speed and efficiency became a mantra at Sirtris as its burn rate escalated. To help minimize costs, Elliott orchestrated initial diabetes trials with SRT501 in India. (Lest you think that that common industry practice is unethical, consider that many sick people in places like India can’t afford any medicines at all, much less therapy given in stringent trials designed to meet FDA standards.) Saving both time and money, Westphal, Sinclair, and Elliott used themselves as unpaid volunteers for preliminary tests of SRT501’s ability to get significant amounts of resveratrol into the bloodstream—Sinclair, who hates needles, often looked ashen after the blood-drawing sessions that were required. The biotech also farmed out much of its chemical synthesis work to a contractor in China.
Meanwhile, Westphal kept the liquid-fuel tanks topped up. Before Sirtris went public in 2007, he brought in a whopping $113.5 million from venture capitalists and other investors in five financings—far more than any previous gerontology spin-off had secured at such an early stage. Sirtris’s ability to raise money partly stemmed from growing excitement about anti-aging research in general, and about Sirtris’s in particular. But Westphal made use of the buzz with great care. He’d worried from day one that Sirtris would get sucked into what he called “the vortex of inflated expectations” surrounding anti-aging science. On the other hand, he knew that public fascination with Sinclair’s anti-aging research could be a powerful money magnet.
Sirtris’s need for unassailable scientific respectability predominated at first, and the company’s releases before 2006 merely stated that it was focused on sirtuins without mentioning its link to anti-aging research. But figuring out how to safely tap the vortex’s energy was never far from Westphal’s mind. And as evidence accumulated that Sirtris’s underlying science was sound, it seemed less risky to do so.
By mid-2006, Milne’s team had found SIRT1 activators that were a thousand times more potent than resveratrol. As Sinclair had expected, and the more guarded Westphal had ardently hoped, the novel compounds engendered CR-like effects in mice. In fact, Sirtris’s biologists showed that both SRT501 and the new SIRT1 activators, whose molecules were very different from resveratrol, significantly reduce blood glucose and insulin in mouse models of obesity and diabetes. SRT501 also had been found to block optic nerve damage in mice with a disease akin to multiple sclerosis, indicating that Sirtris’s drugs might ameliorate various forms of neural degeneration. There was a collective sigh of relief at the biotech as the encouraging animal data rolled in.
The glow at Sirtris was further stoked by promising, unpublished data flowing from the labs of its academic collaborators. (While building its brain trust, Westphal had nearly cornered the world market on sirtuin expertise.) The parallel studies with resveratrol in mice led by Sinclair and by France’s Johan Auwerx were especially heartening. The emerging evidence that SIRT1 activation rejuvenates mammals’ mitochondria particularly excited Sirtris’s drug developers, because decay of the cellular power stations had been implicated in many diseases of aging, including diabetes. In late 2006, Dipp began setting up a clinical test with SRT501 in patients with MELAS, a rare genetic disease involving defective mitochondria that leads to fatal brain and muscle degeneration.
Ironically, the progress at Sirtris was quietly unfolding at the same time that doubts about Sinclair’s discoveries were being raised and forcefully reiterated by the University of Washington’s Kennedy and Kaeberlein. Sinclair was frustrated by the fact that the biotech’s trade secrecy prevented disclosure of its findings, which represented compelling support for his embattled view that resveratrol and other SIRT1 activators are CR mimetics. Westphal was chafing too. As the CEO well knew, VCs who were considering making bets on Sirtris, as well as potential drug-company partners, were likely to get an earful from Sinclair’s critics while doing their due diligence. And the skeptics were essentially arguing that Sirtris’s pursuit of SIRT1 activators was folly.
But publicizing the telling results with Sirtris’s novel SIRT1 activators in a press release would likely backfire—the critics would trash it as unsubstantiated corporate hype. When Westphal and Sinclair proposed instead that Sirtris report the findings in a peer-reviewed journal, the biotech’s board nixed the idea. Landing the report in a top publication like Nature would require disclosing the SIRT1 activators’ chemical structures. That might enable competitors to rapidly develop variants of the molecules that weren’t covered by Sirtris’s patents.
But Westphal, who’s a good listener but not so good at taking orders, wasn’t about to drop the idea. After the board dismissed it, he found himself wondering whether he would get fired if he went ahead.
He had another reason for wanting to stir excitement about Sirtris’s progress. Sinclair, who was continually bombarded with requests for advice on taking resveratrol, was convinced that there would be huge demand for SRT501 if it were sold as a dietary supplement. Westphal saw a lot to like about the idea. It would obviate Sirtris’s need to deal with the FDA on its first product, cut its cash-burn rate, and make him less beholden to the VCs supplying money to Sirtris, who dominated its board. There were precedents. Italy’s Sigma-Tau Pharmaceuticals, for instance, was mainly a prescription-drug company yet also sold clinically vetted nutraceuticals for various diseases.
But even if Sirtris avoided the kind of hype that gives the nutraceutical business a bad name, selling a dietary supplement with purported anti-aging effects would force it to head right for the vortex Westphal had long avoided. The company’s eminent scientific advisers, and some of its staff scientists, might even resign, fearing taint by association. Besides, if SRT501 really worked as hoped, offering it as a nutraceutical would probably mean forgoing much greater future returns from its sales as a prescription drug.
After mulling the nutraceutical option for months, Westphal and his top managers decided it was best kept in reserve until more was known about SRT501’s prospects as a prescription drug. Nevertheless, the safe distance from the vortex that Sirtris had maintained since its inception was about to end. After the electrifying mouse studies on resveratrol came out in late 2006, Sirtris was vortex-bound whether Westphal liked it or not.
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Sirtris was deluged by calls after the results of Sinclair’s study were widely reported in the media. Everyone from reporters in Australia to a pair of elderly sisters planning to add the biotech’s drugs to their daily doses of red wine were suddenly trying to get through to Westphal, as were potential new investors. When I stopped by Sirtris soon after the news broke, Westphal’s tiny office was more cramped than usual because of several large, handsomely wrapped packages piled near his desk—Christmas gifts, he told me with pained amusement, from people he’d never heard of. He hadn’t quite gotten used to his new image as keeper of a golden goose.
He liked its eggs, though, and six weeks after the resveratrol study was published Sirtris took the first step toward an initial public offering at an all-day confab with investment bankers. Leaning back in his chair in the biotech’s bare-bones conference room, Westphal watched with judicious absorption as delegations of dark-suited bankers came through, each allotted an hour to make a presentation aimed at convincing him to hire them to manage the IPO. His sober demeanor belied his thoughts—he was ecstatic.
Early-stage biotech start-ups often find themselves playing the role of beggars rather than choosers at such meetings. Big investment banks often don’t even bother to bid for the small potatoes represented by tiny biotech firms’ IPO fees. Sirtris’s meeting, however, had become a jam-packed beauty pageant—with Westphal as the judge. J.P. Morgan even sent its director of equities trading. Struck by his casual air of command, Westphal later referred to him as “the regal guy.”
As one of the last teams of bankers filed into the room with smiles and handshakes, Hoffman, a Sirtris director whose sense of humor is similar to Westphal’s, leaned over to the CEO and whispered that he should have worn a papal ring for the bankers to kiss as they came through the door. Laughing, Westphal shot back that “in a few months, I’ll probably be on my knees begging them to keep the IPO on track.”
He wasn’t exactly joking. In fact, six weeks later he was walking past a Fidelity Investments office in downtown Boston and noticed that every stock price displayed on a big screen in its window was shown in red. The market had suddenly gone south with a vengeance, and the Dow Jones Industrial Average had just plunged more than five hundred points, its biggest drop since the September 11 terror attacks. One of the possibilities that kept him awake at night seemed about to become real, for trying to sell early-stage biotech shares in the wake of a market crash would be like panhandling during a hurricane. But when he talked to the J.P. Morgan bankers leading the IPO later that day, they made reassuring sounds. The downturn was no more than the expected stumbling of an aging bull, they said, and Sirtris’s story was so special and hot that the market’s vicissitudes likely wouldn’t have much effect on demand for its shares.
Indeed, investment bankers were pressing Sirtris to seek at least $60 million from the IPO, which at first was more than Westphal thought prudent. He worried that its shares would wind up being sold at a demoralizing markdown if the expected demand didn’t materialize. But he became significantly less worried after he was unexpectedly dealt a couple of wild cards in his high-stakes game with Wall Street: Two famous investors came forward out of the blue and jammed a small fortune into Sirtris’s back pocket.
In early 2007, hedge fund tycoon John Henry, principal owner of the Boston Red Sox, and legendary former Fidelity fund manager Peter Lynch joined forces to lead a $36 million investment in Sirtris—Henry initiated the financing after getting excited about the potential of sirtuin-based drugs to retard aging. To Westphal the extraordinary infusion of cash couldn’t have come at a better time, for it sent a clear message to the institutional investors who would mainly buy the biotech’s IPO stock: Sirtris isn’t desperate for your money, so forget trying to beat down its per-share price.
Just before the price was finally set in early May at a quite respectable $10 a share, netting $62.4 million, Westphal and his top lieutenants at Sirtris went on “the road show,” a standard part of the IPO process, during which they crisscrossed the country to give presentations to potential investors. They felt like overbooked rock stars. At one point, Bohlin gleefully e-mailed Sirtris colleagues from his BlackBerry that they were “fortunate not to be riding with us right now on our way to the airport. Your CEO just did a complete change of clothes in the back seat of our SUV. Fortunately, Michelle [Dipp] is in the other car.”
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With about $100 million added to its coffers by the IPO and the prior financing round in early 2007, Sirtris had little need to forge an alliance with a large drug company in the near term. But to maintain its momentum, Westphal needed to keep its stock price out of the doldrums. If the price sank much below what the shares had sold for at the IPO, and stayed there for an extended period, Sirtris would likely get a reputation as just another biotech that had failed to deliver—totally unjustified, perhaps, but that’s life on Wall Street. Thus, he had to veer near enough to the vortex to generate positive media coverage, but not so close as to tarnish Sirtris’s image.
His role as the “the great levitator” (his post-IPO nickname at Sirtris) didn’t require as much prestidigitation as it did for many biotech CEOs. Research on sirtuins was taking off, and labs around the world were making advances that found their way into Wall Street analysts’ reports on Sirtris, bolstering perceptions of it as a hot stock. Many of the findings sprang from labs overseen by Sirtris advisers. Indeed, Westphal had fashioned the biotech’s far-flung group of advisers into a kind of melting pot for sirtuin research.
One of the scientific advisory board’s latecomers was MIT’s Guarente, the father of the sirtuin niche and cofounder of Elixir Pharmaceuticals. Elixir and Sirtris, recall, had long vied for recognition as the leading biotech based on aging research. A few months after the IPO, Sirtris announced that it had licensed exclusive rights to applications of an important discovery in Guarente’s lab that suggested SIRT1 activators might reduce artery clogging. The announcement left little doubt that Sirtris had pushed ahead of Elixir in the sirtuin niche, and a few weeks later, Guarente was named cochairman of Sirtris’s scientific advisory board.
But it wasn’t all smooth sailing following the IPO. For one thing, Sirtris was having trouble getting FDA clearance to begin U.S. diabetes trials with SRT501. In keeping with a long-standing rule, the agency required the biotech to submit toxicity data on SRT501 from two quite different animal species before testing the drug in people. Typically, mice and dogs are used in such studies. All had gone well in the tests with rodents. But the canine part hadn’t panned out—for some reason, SRT501 tends to pass through dogs’ digestive tracts without being absorbed. (Curiously, that doesn’t happen in rodents and people.) And despite the fact that scores of diabetes patients had already safely taken SRT501 during Sirtris’s preliminary trial in India, the FDA insisted that human testing in the United States couldn’t proceed until more animal data were available. One day when I visited Elliott after he’d had a particularly frustrating phone conversation with an agency official, I had a premonition that the eminently throwable sheep figurines on a shelf in his office weren’t long for this world. But I was wrong—the mild-mannered clinical director never hurled a single one at his wall.
In September 2007, Wall Street analysts downgraded Sirtris’s stock—the shares had simply gotten too pricey, they said. But doubters about the company had another thing coming from the great levitator. A few weeks earlier he’d decided to go ahead with the report on the research advances at Sirtris, and Nature had quickly accepted the paper for publication. (After leading the highly successful IPO, Westphal had more power to call the shots at the company.) As expected, Sirtris was required to divulge the structure of the compounds whose effects were highlighted in the paper. Among them was the first molecule that the company’s researchers had identified as having real promise as a prototype drug. Dubbed SRT1720, it appeared to be a potent SIRT1 activator with salubrious effects in lab mice prone to diabetes.
Ironically, after Westphal had made the decision to reveal Sirtris’s results with SRT1720, the compound began losing luster as a drug candidate. Mysteriously, it was found to cause nausea in monkeys. Luckily, the side effect didn’t appear to be a general downside of SIRT1 activation, and quite different molecules soon replaced SRT1720 in the company’s queue of development candidates. But by the end of 2007, SRT1720 was headed to the shelf. Thus, when the Nature paper appeared in late November, it divulged little of value to Sirtris’s competition. Right after the paper was published, Sirtris’s share price briefly spiked from the midteens to more than twenty dollars, establishing a high-water mark that would figure into the company’s value when it was acquired a few months later.
The report in Nature opened a new chapter in the sirtuin story, helping to move it beyond the haze surrounding resveratrol. It described in detail how SRT1720 potently activates the SIRT1 enzyme in the test tube, and induces CR-like effects in rodents, including the lowering of insulin in different mouse models of diabetes and the forming of new mitochondria in muscles. Importantly, the rodents’ weight was unchanged on the drug, so the effects couldn’t be dismissed as a case of drug-induced appetite suppression inadvertently causing CR.
France’s Auwerx chimed in a year later with a second report on SRT1720 showing that, like resveratrol, it boosts exercise endurance in mice and enhances the use of fat as fuel in their muscles. Hefty doses of SRT1720 even prevented weight gain on rich diets. The study, coauthored by Sirtris scientists, did show some differences between the actions of resveratrol and the novel SIRT1 activator. But it generally supported Sinclair’s and Guarente’s view that SIRT1 activation mimics calorie restriction. (It should be noted that not all of the mouse data on SRT1720 have been encouraging—a group at Pfizer reported in early 2010 that the compound failed to show benefits in diabetes-prone mice.)
The Nature paper burnished Sirtris’s reputation as more than a hot stock—the company was beginning to look like a truly substantial drug developer. That impression was further strengthened by growing evidence that multiple members of mammals’ sirtuin family of genes have major roles in metabolism. The family is defined by its seven members’ resemblance to the SIR2 gene in yeast, which MIT’s Guarente had famously identified as regulating life span. While the sirtuins have very complex functions that will take years to pin down, it seems that at least several of them join with SIRT1 to help slow aging when starvation looms. SIRT3, SIRT4, and SIRT5, for instance, appear to be involved in fuel switching during CR, boosting energy production from molecules other than sugar when it’s in short supply. A 2006 study overseen by Harvard researcher Fred Alt, a Sirtris adviser, showed that SIRT6 helps keep DNA molecules pristine—when SIRT6 is disabled in mice, they show signs of premature aging and die soon after birth.
The rapid pace of discovery on the various sirtuins confronted Sirtris with a tricky decision: whether to continue betting the farm on SIRT1-based drugs or instead to devote a big portion of its budget to early-stage research on other members of the sirtuin family. Some of the biotech’s top scientists pushed the latter as a way to mitigate risk— if activating SIRT1 turned out to have major side effects, for example, the company would have fallbacks. Others favored maintaining the heavy emphasis on SIRT1, including an expansion of clinical testing with SRT501 to cancer patients. Westphal steered a middle course, supporting initial forays into the wider sirtuin space but not spreading bets so much that the ambitious SIRT1 program had to be scaled back. As chief levitator, he regarded the ability of clinical trials with SRT501 to generate investor interest as critical for maintaining Sirtris’s momentum. Besides, he still felt that if SRT501 fulfilled his and Sinclair’s dreams for it—a long shot, he readily conceded—it would change everything, and not just for Sirtris.
But would the powers that be at GlaxoSmithKline buy into the dream?
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Talks between Glaxo and Sirtris had begun more than two years earlier when Tachi Yamada, then the British drug company’s head of research and development, had explored a possible partnership with the biotech. It was obvious that Glaxo saw SIRT1 activators as potential successors to Avandia, a blockbuster for diabetes that it had launched in 1999. Avandia helped usher in a new class of medicines, called glitazones, that mitigate insulin resistance. But the glitazones can cause weight gain and other side effects that SIRT1-based drugs might dispense with while delivering similar benefits.
Glaxo wasn’t interested in developing resveratrol (or SRT501) because of the murk surrounding its mechanism of action and the inability to patent it. And when its team arrived at Sirtris in early 2006, the biotech had little to show besides preliminary mouse data with resveratrol. “It was like, ‘Who cares about that?’ ” Westphal told me later. “But they told us that if we got good results [with novel SIRT1 activators], they’d be very interested.”
For the next two years Sirtris saw Glaxo as its leading competitor. But the rivalry turned to romance after Sirtris reported the promising results with SRT1720 in Nature. Glaxo R & D chief Moncef Slaoui, a dapper, cosmopolitan Moroccan immunologist who had succeeded Yamada, wasted no time letting Sirtris know that the drug company’s interest in a partnership was on the rise. In late 2007, he and Glaxo’s head of drug discovery, Patrick Vallance, flew to Boston to meet Westphal and talk about combining forces on sirtuins.
In January 2008, Sirtris stirred further excitement by announcing at a major biotech conference that SRT501 had shown modest but statistically significant signs of efficacy in its early-stage trial with diabetes patients. After that, recalled Westphal, “the dance was fully on” with both Glaxo and several other prospective partners.
Sirtris’s negotiations with Glaxo, however, were complicated by an ongoing CEO transition at the pharma company. In October 2007, it had announced that Andrew Witty would succeed Jean-Pierre Garnier as chief executive. As the changeover drew near, Glaxo seemed to lose interest in Sirtris. Toward the end of March 2008, Westphal recalled, “we hadn’t heard from them for a month. I was really annoyed,” and he decided to skip an upcoming research conference in New York that Glaxo had invited him to. “But Garen [Bohlin, Sirtris’s chief operating officer] said, ‘You have to go.’ So I said, ‘Okay, I’ll do the dinner the night before’ ” the meeting and then leave.
After the March 31 dinner at Per Se, one of New York’s few Michelin three-star restaurants, Slaoui took Westphal aside for a private chat. The impatient biotech CEO decided to take a fish-or-cut-bait stance, and to keep it simple he surprised Slaoui by proposing that Glaxo buy Sirtris outright, cutting short the protracted negotiations that would be necessary to work out who would control what in a partnership. A few days later Glaxo tentatively agreed to buy Sirtris for $22.50 a share, or $720 million.
When the deal was announced on April 22, many industry watchers seemed mystified. Underscoring the bafflement, Forbes called the deal “an expensive purchase of an essentially unproven medicine,” adding that Sirtris had been trading for only about twelve dollars a share before the announcement.
Glaxo’s logic wasn’t all that hard to figure out, though. A year earlier, the New England Journal of Medicine had published a high-profile study linking Avandia to increased risk of heart attacks. The data on the issue weren’t clear-cut, and some studies showed no appreciable signs that the Glaxo drug poses cardiac risk. But as the controversy about the drug escalated, the FDA told Glaxo to add a “black box” warning related to heart risks to its label. Then an FDA advisory panel recommended that in the future the agency should more rigorously scrutinize diabetes drugs’ safety risks before approving them. Avandia’s sales plunged, and some consumer advocates even called for it to be pulled off the market. If Sirtris’s drugs worked, they would be just what the doctor ordered for what was ailing Glaxo in the diabetes market.
That wasn’t all. Like other industry players, Glaxo has been beleaguered by the soaring costs of drug R & D. Industry-wide, the average cost of developing a drug in 2004 had risen to more than $860 million, probably too much to be sustained for long, according to a 2006 article in the New England Journal of Medicine. Worse, drug regulators are increasingly reluctant to approve, and insurers to pay for, new medicines that offer only incremental improvements over older, cheaper generic ones. The possibility that Sirtris’s experimental drugs were CR mimetics—and thus able to counter many diseases of aging in a novel way with few side effects—promised some potent relief from this larger, long-standing malaise. As Witty commented after the acquisition was completed, “If we are right then [Sirtris] is a platform for multiple drugs. This is a very binary type of investment because if we are wrong we might get nothing, but this is exactly the type of thing that a company like GSK should have in its portfolio.”
Glaxo also coveted Sirtris because Slaoui and Witty were planning to restructure their company’s drug-discovery operation to infuse it with biotechlike speed and creativity. The plan called for the formation of small “discovery performance units,” or DPUs, of ten to eighty people that would be more narrowly focused than Glaxo’s traditional discovery groups—a DPU might work on a single drug target. Slaoui saw Sirtris as a ready-made, bellwether DPU, and because of that, Westphal felt Glaxo would take special pains not to crush Sirtris’s entrepreneurial spirit.
Despite the deal’s made-in-heaven look, Westphal was asked to make a major concession during the negotiations. Eager to keep him on staff after the acquisition, Glaxo insisted that he forgo his right to exercise all of his Sirtris stock options when the biotech was sold—in essence, it wanted to hold back a fourth of the pay to which he was contractually entitled upon a change in control at Sirtris and dole it out it to him over a four-year period, giving him an incentive to stay. That was fine with Sirtris’s board, which didn’t want Westphal to rock the boat with Glaxo, potentially putting the deal at risk. Indeed, Westphal informed me later, one board member “told me, ‘Sorry, Christoph, you’re just going to have to be thrown under the bus on this one.’ ”
After some tense interactions with his fellow directors, who weren’t asked to take a similar hit to their postacquisition proceeds, Westphal agreed to the concession with the proviso that none of Sirtris’s staffers would get less than he did in terms of stock-option vesting. What the heck, he’d wanted to stick around anyway, he told me after the deal was announced, and it often occurred to him that helping Sirtris realize its promise might well be the most important thing he ever did.
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When I dropped by Sirtris a year after the acquisition, Westphal seemed happy with the way things had gone. Keeping to plan, the mother ship, as he called Glaxo, had maintained its distance, largely leaving Sirtris to its own devices. Much of the biotech’s staff had stayed, although there were a number of new names on its organization chart. The highest-up one was George Vlasuk, a former Wyeth executive who had been appointed president, a new position. While Westphal was still overseeing Sirtris, he was spending much of his time in a new role—he’d been tapped to lead a Glaxo unit that develops alliances with outside biotechs. Dipp, after working with Bohlin to integrate Sirtris with Glaxo, had also been drafted to help run the deal-making unit.
For his part, Sinclair was still serving as a scientific adviser to Sirtris, spearheading sirtuin studies at Harvard, and occasionally stirring controversy. In late 2008 he’d quit as a scientific adviser to Shaklee Corporation after a Wall Street Journal article suggested he was helping to promote a resveratrol-containing tonic Shaklee touted as “the world’s best anti-aging supplement.” In media stories about the episode, he expressed dismay about being portrayed on the Web as a kind of celebrity endorser of the product.
There had been some culture clashing. Westphal, for instance, had annoyed some visitors from the mother ship by declining to take part in the kind of all-day meetings they were used to. But the pluses, he said, had dwarfed the problems. “If we hadn’t been acquired, our stock would be worth a lot less now,” he told me—biotech shares had been crushed by the market crash. Like many other small biotechs, Sirtris would probably have had to curtail R&D to avoid a cash crunch. Instead, it was moving at full speed and had launched clinical tests with a novel SIRT1 activator to treat diabetes and inflammatory disorders such as psoriasis, initiated two cancer trials with SRT501, and, in concert with Glaxo and outside scientists, begun investigating its medicines’ potential to treat many other diseases, from Alzheimer’s to atherosclerosis.
While talking about the present and future with Westphal, I found myself also looking back, musing about how he and colleagues had managed to prove that anti-aging research can spawn a roaring commercial success.
Sinclair’s sass, brass, and ambition were obvious contributors, as was Westphal’s gift for getting a passel of big cats to act like Iditarod huskies pulling across Alaska. Luck—lucky timing, in particular—was also a factor. It’s arguable that Elixir Pharmaceuticals came along a little too early to fully capitalize on its founders’ exciting basic research on gerontogenes. As a result, it wound up licensing its leading drug candidate from another company—a relatively low-risk, low-reward strategy compared with Sirtris’s big bet on SIRT1 activators. Just after Sirtris agreed to be acquired for a flabbergasting sum, Elixir withdrew a planned IPO for lack of investor interest.
But the chief reason for Sirtris’s success, in my view, was that its underlying scientific premise, while possibly off in some details, was basically sound—at this point the balance of evidence indicates that resveratrol really does emulate key aspects of CR in animals, and that sirtuins at least partly mediate those effects. That explains why one study after another, including ones by researchers with no ties to Sirtris, have appeared since the early 2000s suggesting that targeting SIRT1 and other sirtuins may confer a strikingly broad array of health benefits that would otherwise be hard to account for. The Sirtris team deserves credit for deftly riding this scientific wave, but the company wouldn’t have gone far unless the wave had been truly powerful. So here’s what I see as the moral of Sirtris’s story: Sinclair/Westphal may be the Lennon/McCartney of twenty-first-century biotech, but you don’t necessarily need another blue-moon pair like them to realize the promise of recent progress in anti-aging science. You just need to make a beeline, as they so singlemindedly did, for the Great Free Lunch.