Skip to main content

tv   The David Rubenstein Show Peer to Peer Conversations  Bloomberg  September 26, 2021 2:00pm-2:30pm EDT

2:00 pm
>> this is my filing system. over much of the past three decades i have been an investor. the highest calling of mankind i thought was private equity. and then i started interviewing. i have learned from doing it interviews how leaders make it to the top. >> he said $250. i did negotiate, did no due diligence. >> how they stay there. >> you don't feel adequate now
2:01 pm
being the second wealthiest man in the world, right? >> -- is a parallel entrepreneur. he starts many companies and biotech at the same time. one of those companies is moderna, now famous for having created the vaccine that dealt with the coronavirus pandemic. i sat down with him in boston to hear about the success of moderna and what he plans for the future in other biotech areas. >> when you came up with the idea, did you in your wildest dreams think it would change the world? >> absolutely not. we thought we might well have the next generation of biotechnology and something that had never been even dreamt before, which was the body parts own ability to make drugs. the notion would be we would introduce a molecule that would code for the drug we would want
2:02 pm
in the body would translate and make the drug that it needs. that was the basic idea, which was a fantasy at the beginning, an act of imagination. that platform would go on to create 20 different products that were being tested at the clinic when this pandemic hit, something we could envision but the pandemic itself and the ability for this technology to be used overnight to fight against this nasty virus, that we did not imagine. >> when you come up with an idea , do you get somebody to be the ceo? how does it work when you start a company. >> our process is -- we don't start with an idea for the company, we started with a range of things we could pursue for which we try to find which one actually goes forward. moderna followed the same process we have which is we
2:03 pm
asked questions that start with what if? what if we could make a code molecule that could make any medicine we wanted? the question is, how do you do that? has it been tried? what gets in the way? all of these questions, so we don't start the company based on the question, we start an exploration. in the summer of 2010 we began to explore these issues. is it even possible? i have likened it to an archaeological dig of the future. you pick up pieces and you look for value. we started doing experiments. as we went forward, we started realizing there was a path we could point to forward. once we get to a stage where it starts to become clear there is intellectual property there, we say how are we going to create a team to lead it and what is the leadership structure? >> now the company has a market value greater than mark, about
2:04 pm
$190 billion. when he first invested, how much money did you put in? >> we capitalized the first couple of years. altogether, my firm deployed $11 million to stand up the company. >> that $11 million has had a return of infinite amounts? >> north of 1000 fold. >> when moderna was you -- was coming up with this vaccine, what did the ceo say? did he say, i've got a way to cure the pandemic? what did you say to him? >> the beginnings of the pandemic were beginning to show themselves in january 2020, we had a discussion about the possibility of starting a program just to be in a position in case this got serious. interestingly, the reason was not because of the pandemic. nobody was using that word. but because we thought we had an
2:05 pm
opportunity to demonstrate one of the hidden advantages of our platform, speed. speed of execution. in a traditional biopharmaceutical world, speed is not an advantage because things take so long to be improved -- approved and regulated that going faster doesn't offer much of a result. but in a epidemic, speed becomes life or death. that is what attracted us at first, then the situation caused us to put a lot of effort into this. >> moderna was a relatively small company. you go to the government and say forget pfizer, give us some money. did they laugh at you? or, was it clear they were interested in anything? >> more the second, but we were well known in all circles of government. from the beginning, we partnered
2:06 pm
with nih. nih was testing our vaccine 40 days after we started our process. of course, they were worried, how could a company we don't know withstand this type of capital importance? how can it scale up weekly. the good news for us starting with the team, they were all-stars from all the major companies. >> did people call you up in the middle of the night? did you unless your phone number? >> i got because i never thought i would get from country leaders. >> what did they say? >> the reality is i couldn't do anything. nobody could do anything. the entire vaccine supply was in the possession of the u.s. government. it had not been authorized for emergency use, so any supply
2:07 pm
under the table would be illegal. i told many people i would more readily get an assault rifle than i could a vaccine because it was completely illegal to do anything with it. it was difficult for me to understand because they viewed it as innovation. people don't realize just how carefully governed this whole thing was and in a way it made it easier for us because had we been able to do this, the demand was in the hundreds of thousands. >> the efficacy is around 93.5%. which means you've got a pretty good chance of not getting the virus. but now the delta variant has come a long. is the moderna vaccine going to be working against that? do you have something just for delta? >> we are preparing for any eventuality including looking at what our baseline after two doses does, which the six month
2:08 pm
data we have available is very robust. we have not seen real deterioration of protection. against deltek, we have strong protection and we will expect that to continue but we do not know for how long. you find out when your guard is down after your guard is down. to prepare for that eventuality, we have begun to make vaccines that have different sequences that if needed we can accelerate so we can actually use that. i think we are going to work closely with regulators. to figure out -- the beauty above -- we can actually do this type of rapid response versus conventional biotechnology that takes years. >> i've got tumor donor shots. do i need a booster? >> the best advice so far is that people after a certain age
2:09 pm
-- and i cannot tell you with that would be because that would be set by the government, would most likely need a booster to be protected against the variant and public health will decide. my guess is that given enough time, we may end up in a situation where we have yearly vaccinations just like the flu. >> tony fauci he has said we must use the example of coronavirus to prepare for other viruses down the road and that companies like yours will do that. are you working on that kind of thing? >> absolutely. a very big part of our future will be being the lead vaccine developer, but additional new technologies we are considering to augment our capability. i should say within the broader flux of engineering, we have multiple projects looking to expand the security net for future pandemics. ♪
2:10 pm
2:11 pm
>> we are in boston. it is probably not a surprise that people would say m.i.t. was involved in moderna, but your background is different from m.i.t. or harvard. you did not grow up in this country. >> i was born in beirut, lebanon. i lived there until the civil war in 1975, and ended up growing up in montreal, canada. >> you were a teenager? >> i was extremely fortunate my parents took us as political refugees. we escaped lebanon.
2:12 pm
>> you went to mcgill university and you majored in? >> chemical engineering, which was interesting at the time because that was the first field that got drawn into biotechnology. >> you then went to m.i.t.? >> yes. i was the first graduate of the bioprocessing engineer center. the first -- who were trained to do work in biology and this industry was being born so you needed engineers to come up with how to make the products. >> were there [laughter] [laughter]a lot of armenians in this program? [laughter] >> i was not surrounded by familiar faces. >> did you want to teach or go into the industry? >> i have reflected on this quite a bit. because this was a new field and i realized how advanced
2:13 pm
education works, the most prestigious thing would have been for me to go teach. here was a field that didn't exist, so i could teach anywhere. they needed people who were proficient in this. i did not seriously think about that. personality wise, but i saw the professors doing. i thought this was not my temperament. because since i have taught at m.i.t., i have realized education itself has changed so much you can be an entrepreneur and a faculty member at the same time. in 1983, that was not the case. the choices then were join a large pharmaceutical company just beginning to hire engineers. what i ended up doing by a chance encounter i had with somebody was decide to start a company, which was rare in the 1980's, let alone for a
2:14 pm
24-year-old immigrant with no experience. >> did your family say get a real job? >> absolutely. even though my father was an entrepreneur in import-export, but the risk was throwing away the education. >> you start a company when you are 24 years old. how did it do? >> the company failed to fail, therefore it succeeded, eventually becoming the largest instrument company in the field at the time, which was 1995. we invented a number of new technologies that can be used to study and make proteins. we grew the -- in revenue. it was a public company for a number of years. lots of ups and downs, but for the period, ultimately successful. >> so you cashed out, got a lot money for a young person, did you retire or teach?
2:15 pm
what did you decide? >> it was complicated because i had started a number of other companies. between 1994 and 1990 seven, four other companies, three of them got sold. in a way it was worse than just doing one thing then calling it a day because i have now sampled doing multiple things. so, i did not consider retiring but one thing i did realize was doing yet another company wouldn't accomplish much because i was not drawn into this notion of being a serial entrepreneur. that's when i started thinking about ideas that have led me to what i do now. in the 1990's i was enamored with parallel entrepreneurship. at that time it was not a thing. the notion of parallel entrepreneurship was, why can't you sign will tenuously think deeply about -- at the same
2:16 pm
time? >> i was doing it individually on that led to institutional virgins. >> the norm would be serial entrepreneurship, you are going several at the same time, not unlike what elon musk is doing. >> yes. >> when did you start raising funds for people could give you money to invest and you would invest in different ventures? >> since 2000, we have operated a series of funds. some of which has been -- and the reason we did it that way was that our idea was to deploy the funds exclusively to companies we can create the science of which we generate. as opposed to the typical investment deal flow, select the winners, we don't have any of that. whatever projects make it through our system get capital. >> if i had been lucky enough to
2:17 pm
know you in 2010 i put $1 million in, how much what i have made? >> i do not have a simple answer but it is safe to say over 15 years we have operated nor -- north of 30%. >> you recently went out and raised new funds and that money came from individuals from all over the world, institutions who beg you to come in? did you turn people away? >> we did but we were pleased with the interest we got. much of the capital came from investors we have had for more than a decade but some of it was new endowments, large pension funds. in this country, we probably represent the best investment multiple states have made. it makes me proud as an immigrant it makes me proud to have a stake in someplace and actually feel good about what we have been able to generate. >> you have had a great
2:18 pm
achievement with moderna, do you think you can do anything as great as that in the future? >> we can generate an engine that can produce companies that might be 1/10 of a moderna. ♪ >> that technically penalize you. i think what people do societally is to invest in a
2:19 pm
license to operate. it is a fickle license because when corporations earn a lot of capital lose that license to operate. if you take your suppliers in your environment and every aspect of what makes your ecosystem -- i grew up in a world where everything was nature driven. everything i understand about biology. there is a biology ecology around companies. if you lose the company, that is your lifeblood. >> some ceos say it is important to speak out on public issues. voting rights things like that. do you have a view on whether that is something public company ceos should do? or should they stay out of public issues? >> during immigration discussions over the last few years, i spoke up vociferously. none of any of the companies we do would have existed. if i didn't do that, it was an
2:20 pm
act of omission i was being complicit with that thought process. in other areas, i do not know that i need to speak out as strongly because other people may have something to add. we should be open-minded. >> a lot of companies in silicon valley and boston are started by immigrants. maybe they are harder working or trying to prove something. have you observed how many companies are immigrant founded? >> the majority in different accounts. i have been involved in various discussions with the political environment was quite against immigration, even talent. but indeed it is the case that there is a lot of immigrants that tend to get to the cutting
2:21 pm
edge of things whether it is because there are things to prove, or by nature they are taking little for granted and are therefore comfortable with discomfort. if you change countries, you don't have much time to say what is owed to me and how come i got disadvantaged? these are privileges of rooted people. if you -- you actually need roots to make you feel like you are entitled. >> sometimes when you have great success in life, it is hard to do it a second time because it is rare someone has a second great achievement. you had a great achievement with moderna which did incredible things to save the world from the pandemic good do you think you can do anything as great as that in the future? >> what matters more to me even than one instance is to actually create. that is what flagship is all about. we are an experiment in whether
2:22 pm
you could institutionally make breakthrough -- with huge impacts and to create companies that can realize that impact. if we can do that systematically over and over, that is such a defiant thought the conventional wisdom that says rare things only happen rarely. we are saying we can generate an engine that can reduce companies that might be a moderna, 10 times moderna. moderna our self was not our design goal, it was the -- moderna was called el s.a.p. when it was born. it was the 18th project. we are now on number 88 in terms of projects that are born exactly the same way. some folks sit -- >> can you make people feel better to say you've failed at something? you just said, this is not going
2:23 pm
to work? >> many of them. in our case, differently than an invest in, i can't write it off. we own the entire entity. we can't wash ourselves from a particular company. i will say quickly, the reason we use the word pioneering is we leap into things that are not yet known to be viable and we try to make them real. this sleeping, and inevitably you lead to places where there is no value. >> leave vaccines out for a moment, what are the two or three things you are most interested in trying to do in biotech that is going to make people's lives better? anything to make me live longer and healthier? >> one major theme that inspires us that we are doing a number of things in his preemptive medicine. we observe what we call today health care is really a
2:24 pm
euphemism for sick care. you've got to get sick to get any of it. there is fitness and living a good life but in between we know scientifically that the beginnings of disease go way before we know we have a disease. if we could intervene at that time and delay or completely deter the disease, we have a different health care cost challenge, let alone a lifestyle. currently, there is no way of developing products for that because the fda doesn't regulate it. their insurance will reimburse it. they need a good disease to do their thing. we have to change that mindset. how can flagship contribute? we started five different platform companies that tackle that either through urgent -- early detection or new types of vaccines that protect before there is a threat could those things are all trying to create an environment where governments and other corporations start doing that.
2:25 pm
>> today, the average person's life span is the mid 80's or something. do you think it is possible to live to 120? is that a good thing or a bad thing? >> it is possible. i am not sure it is a good egg on a planet that is dying. we have to think of our existence not as individuals not anymore then our liberal -- our liberty doesn't think if they are going to live. if we don't start to think about where our society is going to live, it is a moot point as to whether individuals live to 100. there will be this reckoning where we have to create an environment that is worth living. >> did your parents see your six harris -- success? >> they didn't see the last 12 months, but i know that they felt the decisions they made on
2:26 pm
behalf of their children, particularly moving us to north america and giving us an opportunity, as having been more than validated. >> what keeps you motivated? you are obviously wealthy. you could retire tomorrow and be famous. what keeps you motivated to work hard and not spending your money on lavish toys that rich people like to buy? >> i think we have seen the beginnings of a start up industry in this country that has revolutionized the world. in the next few decades, that industry will become professionalized, institutionalized and will do in the creativity world what institutional investors did in the financial world and i am drawn to being one of the pioneers of that. if i can show one way of doing it, organizationally or methodologically and that leads to companies who do it for a living, that interests me as a
2:27 pm
lasting impact. the fact that everything we work on has societal impacts, people say what is your social impact strategy? 100% of what we work on has societal impacts. that's what draws me and keeps me interested. ♪
2:28 pm
the comfortable way to work out. -that looks fun actually. -it looks fun? it looks comfortable and fun. it looks like something i would put by the pool -or something. -looks like a paisley. -hey, a paisley, we'll take it. -yeah. oh my god, i could do this and watch tv at the same time. -exactly! how do you feel? -it feels good. feel my heart racing a little bit, ya know, gotta catch my breath a little bit, but it's good. oh yeah, i can definitely feel it. fantastic. oh yeah, i can do this. this is easy. yeah, that feels great and definitely better than the floor. treadmills, you've seen the bikes with clothes hanging on them, but people don't use it. what's the point? the aerotrainer, people want to use it. -wow, this is easy! -absolutely! it feels good. it feels sexy. i love this, aerotrainer, i want one. i like this. like, i can do this. i want this in my house. (host) wondering if the aerotrainer is tough? you bet it is. (upbeat music) ♪ (engine revving)
2:29 pm
2:30 pm
>> the following is a paid program. the opinions expressed do not reflect bloomberg llc or its employees. -- the market for coins and lien are unregulated. the market cannot predict future performance. these are not the views of this statement -- station or


info Stream Only

Uploaded by TV Archive on