Putting Patients at the Center of Growth

Episode Transcript

VALERIO DI FILIPPO: I’m Valerio di Filippo. We recently published a report that explores how a set of mid-sized European pharmaceutical companies reshaped their portfolio and rewrote the rules of growth in the pharma industry. And this series of conversations aims to go beyond data and listen directly to the leaders that are behind this transformation, to understand the lessons they learned, the decisions they made, and the challenges they faced.

For this episode, I’m delighted to be joined by Rob Koremans, Chief Executive Officer at Recordati. Welcome, Rob. Thanks for hosting us here at your headquarters. It’s a great pleasure to have you with us today.

ROB KOREMANS: Pleasure, Valerio. Nice to be here.

VALERIO DI FILIPPO: A lot happened recently at Recordati, but today’s focus is mainly related to portfolio transformation. But it is also clear that under your leadership you have accelerated this path. So I’m curious to hear—why did you decide to accelerate this path, and what gave you confidence that this was the right move and the right moment for Recordati to go in this direction?

ROB KOREMANS: Yeah. It’s never alone, me, right. So that’s the team, and the company had already done quite a number of important steps into the rare disease area. And if you look at it, there’s still a huge unmet medical need. It’s sort of affordable development also for a mid-sized company. And the risk and time needed are much lower, which for me made it all extremely attractive.

So the growth opportunities—and Recordati is a growth story—are just better at the rare disease side. And it became immediately clear that if you want to be in rare disease, you have to be global. But specifically, you have to do the US really well, because that’s where the majority of the opportunity in revenue and profit will come from.

We tried to do deals, acquisitions of products or companies, that would allow us not just to acquire products and then promote and sell them, but to focus also a little bit more on the organic opportunity that comes from this deal. And that was very clear with the acquisition of EUSA, which gave us a rare oncology opportunity. But the products that we acquired also allow for indication expansions—so lifecycle management. And the same is true for the later deal of Enjaymo that we did, now a year ago.

The focus was on the US, an opportunity to go global, and very good opportunities to develop the products beyond the indication that was immediately in target. And with that, I thought we could really generate good value. But it also meant that we had to focus on internal capability building, not just on the acquisition and integration.

VALERIO DI FILIPPO: You recently celebrated your hundred-year anniversary. Clearly it means that you have also a legacy business, mainly in Europe and with established, let’s call it, products. How did you manage to get both sides of the company well aligned, committed, and motivated with your overall strategy, knowing that the culture, speed, and decision-making can be very different?

ROB KOREMANS: I think it was important from the first day that our idea was always to maximize both businesses, and make it very clear to people that were either on the more established business, which we call specialty and primary Care, SPC, where you still do very important work for patients, particularly in diseases like hypertension or prostate cancer, well-established diseases, well-established treatments. And the cash flow we generate from that also served to be able to invest in the rare disease side, where the opportunities were bigger. I think what we did well was explain to everyone that they are part of one Recordati, and explain the different roles that the two businesses have. Invest in both.

And the other thing I think we did well is to bring it back to the purpose. The company was always driven by what’s best for patients. But we found words that resonated well with the entire company: unlocking the full potential of life. And you do that with an OTC helping people address things like indigestion. You do it with a rare disease product, and you can also do it with an antihypertensive.

Getting one common language, investing in both, and having people excited about being part of Recordati and the contribution they can make in their different businesses—and instill that pride and make people really understand how they fit in the overall strategy and what is expected and how they can contribute.

VALERIO DI FILIPPO: You have been on this journey for a while now, so I’m also curious to hear what surprised you the most over this journey and this path. Is there anything that proved to be harder than you expected?

ROB KOREMANS: I think some of the external circumstances were quite exceptional, right? We immediately had Russia invading Ukraine. There was no lack of external crises. It was difficult to prepare for. The company was able to deal with it. I think what surprised me was the engagement and willingness of people. The commitment of Recordati employees is incredible.

Had I known this, I think our ability to integrate and digest acquisitions—we could have probably done a bit more a bit faster. I was always a bit careful not to overload the organization. But this is not a company you overload so easily, so I think we would have probably gone even faster.

VALERIO DI FILIPPO: You referred and you mentioned before about the culture that was there before. But at the same time, I can imagine there were also pieces of the organization that needed some transformation over time. Is there any specific element that you needed to transform the most in order to keep the journey that you described?

ROB KOREMANS: If you wanted to tap into the full potential of the company, we should empower people more and have them less focused on the top, and help to work better together—being able to contribute to how we drive and grow the company.

Then specific capabilities. We did a lot in people development. When I joined, almost everything was recruited from external, capabilities in R&D to allow for this expansion of the use of products and lifecycle management. And then the ability to really be global without driving everything from headquarters. So we focused much more on Japan, on countries like Brazil, opening Southeast Asia. How do you really manage this local and global balance and have people work well together? And we’re still trying to figure that out, but we’re doing not-so-bad a job and I think it’s going well.

And I think today we try more new things. Yes, we sometimes get it wrong, but we correct and move on. And that’s the only way to innovate.

VALERIO DI FILIPPO: You mentioned innovation and R&D. At the beginning you articulated the typical archetype of inorganic [growth] you typically followed. How do you see the next engine of growth for Recordati?

ROB KOREMANS: I think we have three engines of growth, and all of them should center around making products that are best for patients. Ultimately, that’s the business we’re in, and if we do that really well, we will translate it into financial and commercial success.

The three growth engines are, really, continue to penetrate with rare diseases, the markets, because we are only at the surface and there are so many unidentified patients, and to make sure that they get the best possible treatment. Some geographic expansion in markets we haven’t really entered yet with the current portfolio is something we can still do.

The second is expanding the use of our current portfolio into new indications, new combinations, and lifecycle management.

And the third, of course, has always been and will continue to be inorganic—acquiring products. And there we focus a little bit more now on sourcing from Asia, Japan, and China. But also for SPC, Europe is a really beautiful opportunity. We’re super well positioned in some indications like cardiovascular, urology, and gastroenterology to be their partner, and we’re actively pursuing that as well.

So these three, so continue to penetrate, expand the use, and bring in new products and new companies—I think will set us up for continued growth. And we should be able to actually accelerate our growth going forward.

VALERIO DI FILIPPO: Rob, thanks a lot for your time and for being so open with us. Not only a great, inspiring conversation, but also proof that beyond strategic intentionality and relentless execution, all the elements around soft capability, motivation, and engagement have been a key part of the success story of Recordati so far. So thanks a lot for your time.

ROB KOREMANS: I don’t think they’re so soft—and sometimes they’re very hard to achieve. But for people to contribute to their best ability, they need to feel comfortable to do that. And I think we focus a lot on that. So it’s a pleasure.

VALERIO DI FILIPPO: Thank you very much.

ROB KOREMANS: Thank you.