Last week, Lion Bioscience announced that former CEO Friedrich von Bohlen would be returning to the company in a new role as chairman of its supervisory board. BioInform spoke to von Bohlen to find out how he plans to assist the company in this new position, and what he’s been up to since he resigned in January.
Why are you coming back to Lion? What were some factors you considered in deciding whether to return?
When you found a company and run it for such a long time, you stay committed. I have been committed to help the company in the best way I could, and the same is true right now. To be very honest, when this situation came up, I didn’t even have to think about it. I think it was a situation where the company really needed help, and I immediately offered to help in whatever role or capacity I could.
In addition, I’m still the largest shareholder [in the company], so of course I have an interest in the success of the company. So I thought that with almost seven years experience as CEO, and now having seen and learned many other things over the past 10 months, that that can become very good for the company.
As the primary shareholder for Lion, what role did you play in the executive- and supervisory-level changes that were announced last month?
That had nothing to do with my role as the major shareholder. The discussions that they had, and the decisions they made, they made on their own, and it obviously was a unanimous decision to resign, and it was a surprise to me. To be honest, I think it was a bit of an overreaction, but we heard the reasons and let’s take them as they are.
But for me, it’s clear that as a major shareholder I have a responsibility here, and as a former CEO, even more. So again, there was not a single second that I doubted that it was at least the right signal to offer my help, and now that it’s been accepted, I think that’s good.
Can you share some thoughts on how the company can reach its performance goals over the next fiscal year?
First of all, and this is a general answer, I think the company has many strengths. We had a time at Lion where we were thinking that diversification was right, but that did not work out the way we planned. So at this time, where I think the company really has to become break-even as soon and as sustainably as possible, you have to consider what your strengths are.
The second thing is that Thure [Etzold] and Joe [Donahue], the two co-CEOs, I know that they’re working on that plan for the future, and we’re going to meet in the near future so that they can share that with us. And I want to wait until I have heard from them, so I don’t know exactly what they will come up with. I’m interested to hear how they will bring the company to profitability sooner rather than later.
The third point I want to make may be my only criticism over the last 10 months. The former executive team and the former supervisory board — we had a plan toward profitability, and don’t ask me why, but they didn’t execute that plan. And I can tell you that I was surprised that they didn’t. I don’t know whether Thure and Joe will come up with that plan now, but at least I’m in a role where I can ask and in part enforce that plan, and I think that’s good for everyone — for the shareholders, for the customers, for the employees — if the company is heading toward break-even, because I think that’s the only question everyone has: When will this company stop losing money? I’m very committed to helping the company answer that question.
How much of a hands-on role do you plan on having as chairman of the supervisory board?
No hands-on role. German law has relatively clear responsibilities. In Germany, the supervisory board and the executive team are two organs. ... In the US it’s one organ — the board — and you have the acting and non-acting directors on the board. But still, the board has joint responsibility. In Germany, they are basically both responsible to the shareholders. So I will not work hands-on, but I think that with the experience I have in the industry, with the knowledge I have about the company, and also with the good relationship that I have with Joe and Thure, I think that I can do more than just ask the question of which paragraph in the law does that support or not? I think I can act a bit more like an American board member, which is soundboarding, helping, advising, but not doing their job.
Can you share any thoughts on the pros and cons of the company’s possible delisting from Nasdaq?
Let’s wait to see what the executive board proposes. My opinion on that, however, is that the pros and cons remain the same. We have very few ADR holders in the United States, and we have the high cost. And for these reasons, it might be the right proposal for the executive team to delist from Nasdaq and deregister from SEC. But they will come up with a proposal and we will discuss it and then we’ll see. But I’m not negative to it.
What have you been up to in your time away from Lion? How might your experiences affect what you’re bringing to Lion right now?
I said in December that I would stay in the industry and that I would stay active, and that is true. I am actively involved in two transactional projects within the life science industry that have nothing to do with Lion. One project is with a pure-play diagnostics player, and the other one is with a pure-play biopharmaceutical player in the cancer area.
Through these two projects where I am in a consulting role, I have learned so many things, and seen and talked to so many people — and not through the IT glasses. So I know much better how the diagnostic business works today, I know much better how clinical study businesses work today. I have not seen this through the red shift of the IT glass.
I really learned to see new things, and to see things from a distance, which I think will help me at Lion now. Because I think if I had stepped into the board immediately after my CEO position, I may have been too involved.
And the third thing is, that I thought early on about a new endeavor, a new company, and this is materializing. The company is founded, but I can’t say more. It’s in the logical realm of what Lion does, and it should be complementary. We’re having discussions now with certain partners, and I don’t want to say more about it before they have been signed. But I can tell you one thing: This is going to be an endeavor that has an even stronger American focus than anything [I’ve been involved with] before.
That sounds intriguing.
I’m excited, and also with Lion — I think the executive team and the supervisory board is a good team, it’s a good blend. I think the goals are clear. These guys know the company, I know the company, we know what has to be done.
Have you observed any changes in the dynamics of the bioinformatics market over the past 10 months?
Nothing has changed from former predictions. The bioinformatics business is like a pendulum — it’s going from one side to the other, but at the end it will stabilize. So in the beginning, there was extreme hype. Everyone was jumping on it and Lion was in the middle of that. But I think what Lion really has achieved is that we brought bioinformatics into the awareness of people as being an important and necessary industry.
And then expectations were so high and there were so many players that the pendulum went to the other side. So everything that was right until, say, 2001 was wrong in 2003. And I think that not everything was right in 2001, and everything wasn’t wrong in 2003.
So what’s happening now is that there’s been a large shakeout and many companies have disappeared or been swallowed, and at the end it’s going to be a relatively normal business with two or three major and profitable players, and it has to be my goal and our goal to have Lion be one of those two or three.
The future of bioinformatics — as the future of what does the genome tell us — is still far ahead of us. People thought that with the genome, now we can understand every disease, but that’s wrong. It’s like when people found out that the world is a globe, you didn’t have a GPS system the next day, and I think the same is true here. It takes some time to bring it to the market, and now GPS providers are more successful than 500 years ago. So I think the time of bioinformatics is still to come, but at this time it’s normalizing and stabilizing.