Taking big steps

MorphoSys is evolving. We talked to Chief Executive Officer Dr. Jean-Paul Kress about the challenges and opportunities facing the company.

Taking big steps

MorphoSys is evolving. We talked to Chief Executive Officer Dr. Jean-Paul Kress about the challenges and opportunities facing the company.

Jean-Paul Kress, you’ve been at MorphoSys for half a year now. What is your impression of the company?

J.P.K - MorphoSys is one of the successful European Biotech companies that has clearly passed the inflection point of transforming into a fully integrated biopharmaceutical company. The company is deeply rooted in science with a great reputation for its antibody generation and engineering technology platform; it has a strong track record in successful partnerships and a culture that embraces change. Lately, MorphoSys has added an innovative development capability and commercial operations. This, combined with a very promising asset – tafasitamab – on the verge of entering the U.S. market (pending FDA approval), makes MorphoSys a very exciting place to be as a CEO.

Before joining MorphoSys you lived and worked in a number of countries. What do you like about how business is done in Germany?

J.P.K - Yes indeed, I have split my time between Europe and the U.S. lately, and, in fact, continue to do so. First and foremost, MorphoSys’ culture is that of a global Biotech – based in Germany. I have an appreciation of agility paired with precision, innovation paired with robustness, foresight paired with reliability. Germany and the adjacent European countries offer a great talent pool of scientists and engineers with strong backgrounds and great skills. Our workforce combines these with exceptional talent from around the globe and is highly diverse, creating a multicultural and inspiring environment right in the heart of Bavaria and now also in the U.S

Not only does MorphoSys have a new CEO, the company itself is also changing. Could you tell us a bit about the development MorphoSys is undergoing right now?

J.P.K - MorphoSys truly lives up to the origin of its name. Metamorphosis. We are very successfully transforming from a leading technology provider into a fully integrated biopharmaceutical company, aiming to master every step of the value chain. To be able to excel commercially, we have added several capabilities including global Commercial Supply Chain Management, Medical Affairs, Market Access, Pricing, Marketing and Sales. Our supporting infrastructure and services are evolving to serve these new units, all aimed at achieving the ultimate goal of better addressing patient need.

Is this transformation being done incrementally?

J.P.K - No, we are making bold moves. We’ve made an informed and deliberate decision to go for it. Fast and furious. We just filed for U.S. marketing approval for our lead investigational asset, tafasitamab in combination with lenalidomide in r/r DLBCL, which has been accepted and granted priority review by the FDA, with a PDUFA (Prescription Drug User Fee Act) goal date of August 30, 2020. We successfully launched our U.S. subsidiary in Boston and established the commercial infrastructure to be prepared for the anticipated launch of tafasitamab – given FDA approval, of course. We have chosen a partner to accelerate seizing of the opportunity we have with tafasitamab – our lead asset and a potential pipeline in a product in the hematology-oncology space and potentially even beyond.

Dr. Jean-Paul Kress

holds an M.D. degree from Faculté Necker Enfants Malades in Paris as well as graduate and post-graduate degrees in pharmacology and immunology from École Normale Supérieure in Paris. Prior to joining MorphoSys, Dr. Kress served as Chief Executive Officer at Syntimmune (now Alexion), a clinical-stage biotechnology company developing differentiated drug candidates in autoimmune diseases. He also held leadership positions at Biogen, Sanofi-Genzyme, Sanofi-Pasteur MSD, Gilead, Abbvie and Eli Lilly.

Why not continue what MorphoSys has been doing so successfully for over two decades? What are the benefits of the new business model?

J.P.K - Our technology provider business model brought us to where we are today. We learned a lot in terms of indications, antibody engineering and our R&D spend was partly covered by our partners. But there is a certain limit to the value you can generate without becoming a fully integrated biopharmaceutical company. We have far greater opportunities if we aim to be in command of the whole value chain, from research through clinical development to commercialization. Yes, we were very successful with the previous model, but we can accomplish even more, which is why we have decided to take the next step.

At the forefront of this transformation, as you mentioned, is your leading candidate tafasitamab.

J.P.K - Tafasitamab is an Fc-enhanced anti-CD19 antibody. CD19 is an antigen that is very broadly expressed on the cell surface of B cells. Another particularity of tafasitamab is that it is thought to activate two key anti-tumoral pathways antibody-mediated cell killing and antibody-mediated phagocytosis.

Who will benefit from this drug?

J.P.K - We hope to be able to help patients in potentially a number of hematological malignancies in which there is a high unmet need. The first patient group with a particularly high unmet need are those suffering from relapsed or refractory DLBCL, the most prevalent and very aggressive form of non-Hodgkin lymphoma. If you are a patient with this disease, and you do not respond or relapse to the first treatment you receive, your chances of survival actually decreases significantly. The results of our L-MIND study, a combination of tafasitamab plus lenalidomide, in this indication have shown significant promise.

“We are making bold moves. We’ve made an informed and deliberate decision to go for it. Fast and furious.”
Was finding a partner for tafasitamab MorphoSys’ biggest challenge in 2019?

J.P.K - It was one of our key objectives, indeed. And it turned into a great opportunity. One of my first actions after I joined MorphoSys was to re-think the partnering strategy with the management team without preconceived ideas. And we came to the conclusion that we should aim for a global partnership with a 50/50 copromotion and profit share in the U.S. and out-licensing ex-U.S. rights. We ended up with excellent terms – both financial and non-financial -, which put us into a strong position for future value creation.

Why have you chosen Incyte? Why are they attractive as a partner?

J.P.K - The whole process and the negotiations we had were very competitive. We selected Incyte for both, economic and cultural reasons. They are like us – absolutely focused and dedicated to the asset. Two biotechs joining forces. They have proven commercialization capabilities and expertise in the hematology-oncology space. The whole team involved in the partnering process and I really value Incyte’s approach, their availability, the tone of the discussions and of course the terms had to be competitive. I am very confident that together we can unlock the full potential of tafasitamab.

Before joining MorphoSys you have gathered a lot of experience in both pharma and biotech companies. Is there one thing you learned at each company that will especially help you to make MorphoSys’ transformation a success?

J.P.K - Thinking back, there were three key learnings during my professional career that will contribute to the success of MorphoSys. The first set of experiences is that I have led breakthrough specialty care launches in the U.S. and internationally. Several of these launches were through partnerships, in a similar fashion of what we have done recently with Incyte. So I am familiar with the requirements to be successful in business partnerships and joint ventures. There is a bit of an art to this. You anticipate issues, you put a lot of effort in, it is like a marriage. The second element that will help me is my former position as CEO of a VC backed biotech company in the U.S., which was acquired by Alexion. This endowed me with important M&A corporate strategy experience which will be certainly helpful for MorphoSys. Last but not least, I am confident that my experience in commercial and at leading organizations as well as bridging cultures on both sides of the Atlantic will ideally complement our future strategy at MorphoSys. Being familiar with both the U.S. market and European requirements will help us to become a global biopharma company.

Looking to a future beyond the launch of tafasitamab, where do you see MorphoSys?

J.P.K - We deliberately take one bold step a time. Right now, our focus is on achieving approval for and successfully launching tafasitamab. Tafasitamab is a potential pipeline in a product. We are committed to creating as much value as reasonably possible, fast and jointly with our partner Incyte – not just in the U.S. but globally. Beyond tafasitamab, we have promising proprietary assets in our pipeline such as MOR202 in an autoimmune setting and MOR107 in oncology as well as a strong cash position. We hope we can successfully commence the clinical development towards a potential future launch of these assets, supported by our commercial U.S. operations.