Launching a drug development company with novel technology from academia
Our corporate group has worked with hundreds of entrepreneurs at this stage to help them optimally and efficiently select and form the appropriate legal entity
Principal Timothy LaBua is a former in-house attorney at a private equity investment firm. He explained that hesitancy and over cautiousness was a constant point of frustration when working with large law firms.
"They tend to be more risk averse, and the advice given wasn’t actionable. [At Faber], we have a sensitivity to the challenges of in-house attorneys, a trait rarely found at the big-box law firms. We understand how they think about the guidance they solicit from outside counsel. They are in need of actionable advice, and we are much more likely to give it to them."
Working with law firms that lack in-house experience can actually hamper business interests, according to Senior Counsel Jodi Stanfield, who worked for several years at the European headquarters of a global contract research organization, working on clinical trial agreements and compliance matters for pharmaceutical and medical device clients.
Stanfield explained that lawyers without this valuable experience may not fully understand the implementation of their agreements in the real world, which can actually create future problems for the client. With a combination of calculated risks and insightful precautions, we guide our clients towards optimal outcomes, while addressing potential conflicts from the start.
Unlike many of our big law counterparts, our lawyers don’t solely focus on the immediate outcomes of a transaction. Our in-house backgrounds have provided us with the first-hand experience of living in these deals for their durations, and seeing how modest adjustments to governance provisions, or financial incentives, or liability allocations can improve alignment of interests toward achieving our client’s long-term goals for the transaction. “When you work in house, you have to live with the consequences of your deal,” explained Principal Gregory Ikonen, who before joining Faber served as CEO of a successful chemistry platform-based biotech and agbio company in the Bay Area.
Living in the deal also involves collaborating with an individual or entity that was previously on the opposite side of the table. When negotiating against someone you may end up working with, helpful resolution is essential. “There are frenemies everywhere and knowing how to handle frenemies is not something that all firms do well,” explained Mr. Ikonen.
“While in-house, I have been in deals where my company had good and bad leverage,” stated Principal Mark Cooper, who joined Faber after serving as VP and Assistant General Counsel for Business Transactions, Research & Development at Pfizer. “There are a lot of points where it makes sense to come up with practical resolutions. Your opponent becomes your partner, and if you cram leverage down a partner’s throat, it does not foster a productive partnership. As in-house attorneys, we understand that it is sometimes in the client’s greater interest to foster collaboration going forward.”
As former in-house counsels, our attorneys also know first-hand what’s at stake in a pending deal. Startups deal with limited budgets and the outcome of a deal can mean the difference between business success and failure. This is a concept that mega law firm attorneys may not adequately comprehend. “Big firms don’t understand the constant fear of the wolf at the door,” stated Mr. Ikonen. “They lack a sense of urgency or appreciation for an emerging company’s existential existence of getting the deal done.”
Of Counsel Brian Connelly, a former Senior Manager for Business Development at IDEXX Laboratories, further spoke about the economic consideration gained from in-house experience.
"As in-house counsel, sitting at the table for Management Team meetings or project team meetings, we do our job best when we are seen as counselors (and not just lawyers with particular technical skills). That means not just supporting drafting and negotiation of a transaction but also
and how to achieve all of this within a budget that we recognize may be siphoning critical resources from R&D activities.”