From Scrubs to CEO: A Unique Perspective on Patient Care

OK so I'm going to start. Laxatives pharma services is a contract research organization that helps companies to develop. Ophthalmic drugs to advance eyesight, and it's led by a rather unique individual, George McGrath, who joins me today. What strikes me most about George is how unusual he is as a CEO in this space because he also works as a physician, actively practicing medicine.

And there have been plenty of times when he's taken Zoom meetings in scrubs, when he's just completed surgery. So there's no doubt that George is dual roles bring a huge competitive

advantage to Exodus with his patient centric perspective, giving him and giving him a profound understanding of patients and their needs. Welcome to the podcast, George. It's brilliant to have you here today.

Could you start by explaining to the listeners a bit more about your background and role at laxatives? Sure Thanks for having me. Hannah this is quite a pleasure to speak with you guys and to give you a little bit of my background. So as you mentioned, I am an ophthalmologist and I trained at the Medical University of South Carolina.

I did an internship in general surgery there, followed by my ophthalmology residency. After ophthalmology residency, I did a fellowship in Philadelphia, the world's Eye Hospital in cancers in and around the

eye. I did that because there was nobody else in South Carolina doing it right. Sorry, sorry, sorry.

Could I just detracts a bit there? There's AI think it's since you joined Abdul. don't know. There's a bit of an echo or a sound problem.

I don't mean let me hop off. I just wanted to make sure everything everybody got connected so that sign is just echoing back. So sorry, George. I think we're going to have to start again.

I'm sorry about that. I'll hop off. I think it should, to be honest. It shouldn't do that.

So it's just for some reason it's not good. But Thank you for coming on. OK best of luck in. Sorry about that.

I don't know why that was happening. Is that going to start again? Yeah Yeah. You want me to just start or would you like to?

You can start. OK Thanks for having me, Hannah. It's quite a pleasure to speak with you guys today. And so, yeah, a little bit about me.

So I am an ophthalmologist. I did my training at the Medical University of South Carolina, where I did my ophthalmology residency. After that, I went to wills Eye Hospital and did a fellowship for two years and and cancers in and around the eye. The reason I did that was really because there was nobody else in the state of South Carolina doing that.

So when I was in my training, we'd have to send these patients either to Philadelphia or Atlanta or New York for treatment. And it can be really hard on some patients, particularly one of the cancers I treat is retinoblastoma, which is a cancer that affects infants. And so these young families had to go from South Carolina to Philadelphia at least once a month for the first two or three years of the kid's life. So so anyways, I did that training and really.

I think that described my career path is unique, but I think the one thing that sort of ties it all together is that I'm really just trying my best to help improve

patients' lives. In terms of ophthalmic care, right. And so I've been a practitioner of that, you know, I've been a clinician, a surgeon treating individual patients. And then I've also been on the other side where I've been developing medicines.

Right, that help many, many patients, but not quite as not quite as directly as actually treating the patients. And then the third angle of what I've done in my past with the equity research has been to help. Get good technologies funded, right? So to get the capital allocation to the right companies.

And so, so really everything I've done has been about trying to improve vision care for patients and, and that's really what ties it together. And the stuff I do is Lex Tice really is a multiplier of that, right? Because the trials we do is like stars. The medicines that we're involved with can be much, many more times impactful than seeing individual patients because they, they.

Affect patients in a worldwide. Once medicines are approved and it is quite a privilege to be in the area where we're able to. Try to prove whether or not medicines are safe and efficacious for patients. So it says a little bit about background.

So after my ophthalmology training, I did, I did, I did an MBA, I did a master's economics from Johns Hopkins, and then I went into equity analysis where I was looking at different products and I was trying to pick out which ones had the highest potential. And then from there, I found a product that I really fell in love with at a company called Hovan. And I joined that company to help develop that product and ended up developing in ophthalmology, inhalation and dermatology for them for six years or so. During those six years, like Starz was our service provider, right?

So let's toss ran our clinical trials for two

products that we had at the time. And so at jovian, after six years it came out, we had progressed the products to a point where it was time to license them to later stage companies and commercial companies. And so it was a natural jumping off point. And then so I spoke with the team at Lex TASS and they graciously allowed me to join the company.

And so I joined the company three years ago as the chief medical officer. And then about four months in, I was promoted to Chief executive officer of the company that led us to us. I think it's quite interesting. When I joined, we were about 35 people.

We've grown dramatically, so we're now just over 200 people in the past three years. So it's been, I think, a real realization by the market of the quality product that the team at Lex tarsa has been delivering for the past 10 or 11 years. And so I think what's happening is that the market's realizing. The value that we're able to add to our programs, and that's caused our company to dramatically grow.

Great Thank you for explaining that. If I can go back to your dual role as a CEO of position, I mean, both are very different. Could you go into more detail about why you decided to keep working as a physician and what benefits your perspective has brought to your work? Oh,

so well, I love it, right?

I mean, I'm addicted to it. I love taking care of patients. It's really quite a privilege and quite an honor to be able to do that. I think it keeps me really grounded with the purpose of what I'm doing, which is trying to advance our care, right?

So when I see the patients who've lost vision, when I see the patients who are afflicted with what sometimes are very horrifying diseases, it really keeps me energized. I'll tell you at this point. The job at Techstars has become, you know, but it continues to become more and more complex as we continue to grow and we continue to do more things. And as that happens, my clinical time and surgical time goes down dramatically.

And so at this point, I'm only seeing patients like once a week or so and you know, maybe twice a week, some weeks, depending on the scheduling. So I do do some surgery still. I do still see patients, but it's been dramatically curtailed. It's a similar it's a similar.

I have a similar model. And sort of what I've modeled my career a little bit after was Raj, Raj, pilot Johnson Johnson, who is their chief medical officer. He's also an ophthalmologist that I've known for quite some time, and he also practices one day a week at his practice in Washington, d.c. and so he's been really an inspiration to me and sort of a wonderful person for the field of ophthalmology. Could you go into a little more detail about laxatives, pharma services, the company's mission and work?

Oh, absolutely. So looks to us one of the services is an ophthalmology focused contract research organization. Right so we are our purpose in life is to try to help people develop their ophthalmic products and devices. Right medicines and devices.

So we work with anyone from. Single person companies to large multinational top five pharma companies and. And we really. We really have the goal of taking a product from conceptualization right to the time when you've got an idea.

The science seems to make sense. Potentially you might be able to affect the lives of patients with ophthalmic conditions. And we work with those companies to take them through the regulatory, the clinical and the sort of medical strategy aspects of developing those drugs and devices through. Through the clinical trials.

So so we get involved typically when people when companies are considering regulatory filings and clinical trials, we don't do any pre-clinical work. So so once they're ready for the clinic, they typically engage with us. And then we go all the way through to commercialization and and even phase four trials. We really have three sort of pillars that add value.

Right so number one is that we're thalamic specific and we're ophthalmic experts, right? So and it's not just me. It's multiple people within the company. Honestly, everybody in the company is, is an ophthalmic expert to some degree.

You know, when you talk to our statistician, our statistician has just under a decade of ophthalmic statistical work. So he knows ophthalmic stats. You know, our data management is the same way. Our clinical teams, our regulatory it's all infused with ophthalmology.

So so we really are experts in ophthalmology, which which is the key to the company. The second pillar is really that. That we have really deep relationships with the stakeholders in ophthalmology. So we take these really seriously, right?

So we really spend a lot of time and effort working with ophthalmologists across the country, the investigators, the key opinion leaders, and in trying to make their lives honestly as easy as possible, because I've been in their shoes. Right it really can be tough as an investigator. Right you're seeing patients for clinics and you're trying to do research. The protocols keep getting more and more complex.

And the and and it can be tough. And there's a lot of, you know, turnover and things like that within

medical practices right now. So so like we it looks to us a lot of time trying to figure out how we use our relationships to make their lives as easy as possible so that they can execute on quality research in an efficient manner. We also have really deep relationships with the industry, with regulators and with other key stakeholders, which quite honestly, is a lot of it's a lot of fun and enjoyment in my life is working with the relationships we have within the community because ophthalmology is a small therapeutic area, but we really have some wonderful people that are working at it.

And so it's really a great, great thing for me personally to be able to interact with these high caliber people. And then the third pillar that we have is really a patient centric and a customer centric focus. So we're. We're always know, we are really in tune with what medicines and what endpoints and what trial designs are going to be impactful for patients and not just for proving efficacy, but also for proving whether or not a product is safe to use.

We spend a lot of time trying to create clinical trials that are inclusive or diverse or are able to, um, to truly execute on the non. On the mission of the product, which is to prove safety and efficacy. And so we spend a lot of time with that third pillar, which is really trying to be trying to be centric on our mission and on helping our customers and our patients achieve the goals they want to achieve. Now, as well as your roles as CEO and a physician, you also have a deep knowledge of the investment world.

What does the current landscape look like for cruise? Yes this is something that is just quite fun for me. Right I, I really enjoy capital allocation. And, and really the problem that goes around in my mind is, is in a world with.

With a finite amount of resources. How do we efficiently allocate those resources to the right projects at the right time? And so that's I spend a lot of time thinking about that. And so to directly answer your question, this in the Crowe world right now, we are seeing a softening of the market.

And the reason is because we are a lagging indicator behind the investment community. So the typical string is that have a startup company in the biotech world that's different in big pharma. But the biotech world you have a. You have, you have an idea.

That idea gets funded by the venture community. Once that funding happens, then they start to engage us to help with the actual execution of getting the job done. And so when the venture world softens, like it did in 2022, we see that, in my estimation, about four to six months after

it starts to affect us. So we're seeing that right now, and I think we've already hit the crescendo of it.

And so I think that we are starting to see companies that are getting funded again. I think the first quarter has seen an uptick in that, thankfully. So I think that the Nader's has been reached and and I think that it's going to start to improve from here. One of the big reasons why that happened in ophthalmology is because in our therapeutic area, there aren't a large number of big pharma companies that are.

Serving the late stage needs of development program and commercialization of development program. And so ophthalmology companies traditionally have done a lot of IPOs right through to raise the amount of money that's needed for a large phase III trials and for commercialization. You saw that with a number of companies in the film space sector that debuted in the 2010s. And when that IPO market shut down, it was really tough on APS metallurgy because there wasn't the big pharma.

Angle to kind of step in. So what you've seen in other therapeutic areas, oncology, rheumatology and neurology recently was with some of the acquisitions, has been that as the valuations in the stock market have dropped, as the IPO valuations have dropped, the strong balance sheets of large pharma have allowed them to become. More aggressive in their acquisitions. So you've seen them pick up a bigger chunk of the development pie as the valuation softened in the market.

And so so I think it's a fantastic thing for overall drug development. It leaves ophthalmology a little bit behind because we don't have quite a strong presence in large pharma. But you are seeing that now, like Astellas with their acquisition of a palace and some of the other recent ones, you're seeing a little bit more M&A activity. So I expect.

So to summarize that, I do think that we've had a we've had a softening of the market. I think we've already reached the nature of that. And I think that it's starting to strengthen again. And that's what I'm seeing.

And do you have any advice for startups in the biotech space that are looking for investment? What do they need to know? Oh also, right now in the current environment, there's a premium that's being placed on our clinical data at this point because the market's more competitive for funding right now. Right than it used to be.

And so I'm a I'm a big proponent of trying to get early safety and potential biologic activity data as early as possible to try to

build the story. Right and to try to give people a reason to believe in the drug and a reason to invest in it. I think that these drugs and devices that are developed, really, it is truly telling a story and building a story over time and over a number of clinical trials that really prove out the mechanism all the way through to the real world impact it has on patients. So what I think that's what I think that's happening now is, is that as the venture community wants to see more clinical data in human data, you're seeing biotechs start to move into clinical trials a little bit earlier and a little bit more aggressively than they otherwise would have.

So in a real world example of that is. Is maybe if you have some good preclinical efficacy data, but you have it. You know, that supports that. You think that the drug is efficacious.

You know, good people are going go ahead and do an early clinical trial and see if that holds true and patients assuming you have toxicology and the safety data in place. The other real world example of that is with phase one designs, we're seeing a lot more sort of phase twos

where you're getting early efficacy data, particularly on imaging in ophthalmology from your first few patients that are treated. So you're treating these patients for safety, but you're also getting a hint of whether or not the drug is active or not. And I think that's really a privilege that we have in ophthalmology, because in ophthalmology, we have really, really great imaging techniques.

Right I mean, OCP is down to 8 micron axial resolutions. The palace drug in the eye, very drug. The appellate drug was approved. The very drug likely will be approved based on imaging endpoints.

And so we're having sort of a transition in the multi world towards more imaging. And I think that's a really good thing for the industry. The other thing I would say before moving on to that from that, the other advice I have is to be creative with how you do look at your images. We've got a lot of great software and computer techniques that can elucidate patterns within the images over the course of a treatment with an investigational product that may give you more insight into how your drug is working.

And so I spend a lot of my time thinking about different mechanisms and how we can figure out if there's a way that we can predict which patients need to be picked, need to be treated with which drug. And at which time, right? So ideally I'd be we would have probably a computer that would tell us this, but but some sort of deep learning algorithm or artificial intelligence that would tell us, hey, this patient is likely amenable to this treatment at this stage in their disease. And that's true precision care that I would love to have.

Yeah that would definitely be one of the huge benefits of if this revolution keeps going. MHM in the real world. Example we have of that is, is there's an eye disease called diabetic macular edema. So diabetic eye diseases, number one, cause of blindness and working age adults in the US and in a big part of that is a swelling of the retina, which causes blurred vision.

And those patients are treated by one of two different pathways right now, so-called BGF or by any inflammatories. And right now can't pick out which patients are going to respond, which at baseline. But I think a computer probably could. So the current practice is you start everybody on an individual, and if it doesn't work, then you either add or switch to a steroid.

And so I think that the real world case for I in ophthalmology would to be able to predict the patients that need the steroid upfront. And that's something we're actually working on. Interesting you definitely have to keep me updated on that. So this moves us on to the next question.

There's been a lot of recent industry discussion about the future of clinical research. You just talked a bit about the future potential one potential future there. But I've had a lot of guests on the podcast who have talked about workforce shortages, among other risks that are facing the industry. What do you think some of the key challenges are for over the next couple of years, and how can the industry tackle them?

Yeah so there are three in my mind. Number one is the workflow shortage. The worker shortage is a real thing, particularly at the site level. What we saw was when a lot of the doctor's offices closed for covid, they had a hard time getting

all of their staff to come back.

There was a lot of turnover. And honestly, it takes a lot I mean, it takes a specialized training to be a good site coordinator, particularly at some of these high volume sites. And so we've seen a lot of that where we've had great investigators who have enrolled lots of patients in the past. And do a wonderful job, who have lost key staff, and that has really hobbled them.

And so I think that that's been a risk that we've been living through. And we've been sort of innovating through. Number two is really around. The trust of the community and the trust of patients.

I think that part of COVID. If you look at a lot of surveys and a lot of what we use, a lot of what I've heard from investigators is that. Patients aren't quite as likely to participate in clinical research as they were before COVID. And I don't know exactly what it was about COVID that calls that change, but it does seem to be a little more challenging to enroll patients in clinical trials.

And I think that that's a trust issue. Right I think that we as an industry need to build the trust with patients that, hey, clinical development is needed. It is a very noble thing to be doing. And it is a very well regulated thing to be doing, right?

So when you do enroll in a clinical trial, you can feel really sure that it's going to be as safe as it can be and that it's going to be well monitored and it's going to be well executed to keep the patients first. So I think that that's a second challenge is, is with patients and in making sure that they really have. The trust. The protocols are designed in ways that are inclusive and are at the, you know, level of the patients that allow them to actually participate in the trials and that it improves.

Improves the willingness and the operationalization of clinical research in a patient level. And then the third one is really about. Something that I think is really important, which is which truly is precision medicine. Right and so whether it's gene focused or not, I really think we need to do a better job as an industry of understanding a patient's true pathophysiology, pathobiology and attacking it with precision drugs.

And so an example in ophthalmology is dry eye. So up to date, currently we only have immunomodulators and immunosuppressants for dry eye, but we a large number of patients with dry don't have that as part of their mechanism of disease. And so what you're going to see some of the trials that we've participated in recently that will get that. I think we'll get approved at least they have very good clinical data are going after different pathways.

Right and different mechanisms. And so the ability to truly customize care to patients is really important because, you know, the doctor's only as good as the medicines we have to prescribe, right? I mean, if we don't have the medicines and there's not much a doctor, surgeons can do a whole lot more. But from a clinical standpoint, you know, we are really, really dependent on the pharmaceutical industry to provide us medicines with a good understanding of how they work so that we can give to our patients.

Brilliant Thank you so much for joining me today, George. It's been a fascinating conversation. And I hope you'll come back and update us on your work. Absolutely Hannah, we really, really enjoyed this.

And Thank you for doing this, this podcast. And we really appreciate you, including myself. And let's toss. Thank you.

I'm just going to stop.