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James Graham: CEO of Recce Pharmaceuticals · BioBoss

• 0:00
  John Simboli: Today I'm speaking with James Graham, CEO of Recci Pharmaceuticals, headquartered in Sydney. Welcome to BioBoss.
• 0:07
  John Simboli: James.
• 0:07
  James Graham: Hello, John, good to be with you,
• 0:09
  John Simboli: James, what led you to your role as CEO of Recce Pharmaceuticals?
• 0:13
  James Graham: It was quite an untraditional path, if I say so, John. I like business. And that's kind of unusual for a young guy. And frankly, I go for a beer with my friends, and they talk sport, and I don't know what they're talking about. But when it comes down to business, any business, I find it fascinating. So my actual success, by way of which allowed me the capital to be the foundational investor of Recce, came from a completely different company, a folding boat company, of all things. But the fundamentals of business remained the same. The products changed, AKA, I invested in a number of things, one of them was Recce, supporting a brilliant inventor, having a go and seeing what may be possible in this area of great unmet medical need. So as sometimes can happen, you start to learn about something and you find yourself really, really interested. And I made that a foundational investment. I've invested in almost every capital round to date. But really, my role wasn't a job, my role was supporting this brilliant inventor. It did turn into a job, when I realized I couldn't find him any more money. And I didn't want to put too much more in directly myself. So I joined as an executive director listed on the Australian Stock Exchange. OK, I got a job. And then I ended up becoming CEO, managing director for the last, perhaps, two years. And as the second largest shareholder in the company, I get aligned with our shareholders, I get to work with brilliant people, our philosophy of good people in great science. Nobody, no matter how good they are, can really do anything meaningful unless they have others who believe what they're doing make sense, wants to be part of it, and will go the extra mile to see that delivered. And so often, I think, why people reasonably listen to what I have to say, to go above and beyond,our colleagues work seven days a week, all hours of the night, so on and so forth. Because they'd be down a path that I had an initial idea on, and they've run off and delivered it. And it's incredible, because I can't do the things that they can do. It would never be delivered. Even if I tried. And they are so damned good at the particulars of that. Not only what gets delivered, it gets delivered better than it ever would have been, by way of me just imagining the time. And, you know, if you don't have the support of others around you, frankly, I think you have nothing, no matter how good your technology is, you can't do it on your own.
• 2:49
  John Simboli: You respect the opinions of others, as you described it. But how do you know when it's time for you to make the difficult decision and not punt it?
• 2:59
  James Graham: Everybody has their style. I don't actually know if there's a right or wrong, per se, but is where the end outcome, from the start, looked like their idea all along. And they thought of it.
• 3:09
  James Graham: They indoctrinated themselves in it. All I do is ask them the questions to get them to the point where that sounds really good, doesn't it? Yeah, yeah.
• 3:20
  James Graham: Good. Okay, I didn't say you should do this, because they answered the questions in a way that they ended up. And I find, in that context, people can really take significant ownership of whatever that may be. And that always, I believe, gets the best outcome for all involved, everybody is motivated by something. Now, the obvious is, you know, whatever it may be, it can be a job title, which frankly, to me means stuff, or some people that don't care what they get paid, they don't care what office they're in their, their job, title, everything or how their family views them, or how the father would view them or the money they may make, or the money their friends think they make, or whatever it may be. And one really hit me, where actually I've had two instances.
• 4:06
  James Graham: One was with some of our more scientific people, I thought, you know, surely you turn up to make a nice bit of money and you have a bit of fun doing this technology stuff and you go home and your family prospers. I gave them a significant financial benefit, aka an option.. And they were so perplexed. They didn't know what options were.
• 4:30
  James Graham: They didn't see the value in it.
• 4:30
  James Graham: They were rattled by it. They were just, I don't want these options. I don't want to talk about any money and I'm thinking, My God, I'm actually trying to give you the golden handshake. You get all the upside and benefit in this handshake right now for everything you've achieved. And they don't want that. It's like I say money, they run out the door. Whereas other people, if I don't say money, they don't come in the door. Another one was actually, I wanted to give somebody a promotion. And they loved what they did so much, despite it being one of the lower ranking titles, that they burst into tears and said, I just love what I do. I don't want to leave this desk. I'm here to talk with the colleagues and feel relevant. And I thought, that's weird, but good on you,, that's yeah, you do that.
• 5:22
  John Simboli: I think it's rather mysterious to a lot of people, investors included, they probably don't seel a big part of what you have to do each day.
• 5:29
  John Simboli: So if you think about, when saying what do you do for a living, James, you can ask that in so many ways. But another way to say would be, "How do you spend your day?
• 5:40
  James Graham: What I love most about what I do, and I say what I do, because I think the term"What do I do for a living?" is different to "What do you do for a job?" Because what I do for a living is actually kind of all encompassing, at any point in any day. It can be anything. And what I like most about that is the speculative unknown. Every day is different. And the biggest challenge, I find, actually is twofold. One, not waking up in the night too many times and reading my emails, because I just get so excited.
• 6:10
  James Graham: And two, when I do fall asleep, I have such vivid actual dreams in a work setting that I can wake up the next day and be convinced this has happened and move ahead, as if it never happened. It was in my dream. So what I mean by that is blending the world between what I do for a living and actually living in whatever form that may be.
• 6:31
  James Graham: People ask, what do you do for a living? Or what do you do for a job? And I don't really know how to answer. It depends. So if I say, I'm president of the leading biotech . . . that doesn't go. So I say, I run a little biotech on the stock exchange. If they're interested enough, they'll ask another question. But no matter how big, best performing, blah, blah, blah, it is, it's never actually a perfect sentence, generally speaking, to say what you really do for a living.
• 6:59
  John Simboli: When people ask you about what you do for a living, do you quickly move to the nature of what the company does? The anti infectives, or can people understand that?
• 7:09
  James Graham: It really depends obviously, on who is the person I'm before. So if they're of a technical, scientific background, I don't generally say I run a biotech company on the stock exchange. I say, we have an infectious disease company with the lead antibiotic candidates in the world at this time, blah, blah, blah. Now, if I'm talking to a venture capitalist, I say I run this biotech company. We're the sixth-best performing biotech over the last five years. I even put another $310,000 in the thing the other day. I'm actually up. Who would have thought? It kind of depends on the person. You try to connect as quickly as possible. Like, if you say, the scientific one to the business guy, they walk out the door. You say, the business one to the scientific person, they might cry, like, you know, kind of all sorts of things happen. But each and every way I'd say it, I genuinely feel the passion of everything that surrounds what we do.
• 8:04
  John Simboli: Can you recall, when you're eight or nine, or 10, or something like that, and you tried to picture and probably what your parents thought you should do or what you thought you should do when you got to be a grown up? Do you remember any of that? Does have anything to do with what you're
• 8:15
  James Graham: When you're a young person, maybe it's just me doing?
• 8:18
  James Graham: . . . So you know, you look at Dad and my dad was incredibly successful in all sorts of ways.
• 8:22
  James Graham: But no matter what he ever did, is still dorky Dadl O,r Dad, you're such a loser. Go away, like, you know, all these things. But despite those youthful days of thinking, you know, I'm embarrassed by my dad for no reason, it's just that father-son thing. I always wanted to be like that. I could never say that to Dad. And so it was kind of one of those things of knowing you somehow would become what he was. I'd like to aspire to always be like that.
• 8:58
  James Graham: But the others realization, I thought, I want to be just a little bit better than Dad, because then, you know, I've achieved what he'd sought. And it just kind of made sense to me. One of the greatest challenges from my area is I'm good at a lot of things. But I'm great at none. So I'm not an accountant. I'm not a doctor, I'm not a scientist. I'm not a lawyer. I'm not actually qualified in anything but business. And that means nothing. So in the case of, by example, comparing to my father, who I always aspired to be like, he never had a degree. Well, he got one just just before his passing at 52. But he did so many amazing things. And why did he manage to achieve those across so many industries and so many successes? Because he tried. And he tried really, really hard. He was never qualified because he didn't have a qualification. He was never whatever it may be. But that, yeah I can do it, I'm going to do that and deliver it, I just thought was incredible. By example, if you eat an Australian Barramundi, which is, of course, a National Fish in America right now, you're eating my fish, mate. That's Dad who created that company. And the family is going to make some money out of it so make sure you eat Barramundi. But how radical is it, to go from deep down Australia, Perth, Western Australia, most isolated city in the world where I grew up and go, I'm going to go over to New York, I'm going to acquire the biggest indoor fish farm, I'm going to get rid of this American crap they're eating.
• 10:31
  James Graham: And they'll like Barramundi, they've never heard of it, but they'll love it. That is radical. And he did it. And I think, Oh my god! But actually one of Dad's things towards the latter part was he, he said, I wish I really knew what I wanted to do, because I would have just done it. He just did lots of things and I thought, "What am I supposed to do?" The goal somewhere out there, but you never really kind of hit it because it never, you know . . .
• 10:58
  James Graham: But it's fun. That keeps you constantly striving to find whatever that may be.
• 11:04
  John Simboli: What do you say when people ask who is Recce? Or what is Recce?
• 11:08
  James Graham: We actually are, what I believe, to be a new category. A new category that, if you want to invent the name and expect everybody to know what that is, it's too damn hard. So I call it an antibiotic, but it's not an antibiotic. So instead, when I talk antibiotics, when I talk about us, I talk about us out of passion, because we have economic method of manufacture, we have 1000s of species of active mechanisms of action, we work and keep on working with repeated use, we cater to unmet medical needs, meaning those not service by existing antibiotics.
• 11:41
  James Graham: And that allows commercial pricing and it allows choice.
• 11:45
  James Graham: And I think that, among the other advantages that is Recchi, this new category is very exciting. We are the most clinically advanced antibiotic or new class of antibiotic in the world at this time, the first in over 40 years. We are the only ESKAPE pathogen compound. ESKAPE, 50% of deadly bacteria fall into the acronym of ESKAPE compound in the world at this time. We are the only FDA QADP-designated compound for sepsis, the most expensive condition treated in human health in the world at this time. And if you like stock markets, we're the sixth-best-performing biotech stock over the last five years.
• 12:31
  James Graham: So technology works, people are making money and I'm having a good time doing it. So I'm saying that a bit of tongue in cheek, but who wouldn't resonate with that? That's not going to happen, you're going to hit somewhere with it. So it worked.
• 12:43
  James Graham: And it started.
• 12:44
  John Simboli: Do you ever get the dreaded question of, "Well, if this is such a good idea, James, why didn't someone else think of this?"
• 12:52
  James Graham: I love those questions, because that's an opportunity. And depending on the person and circumstance, a variety of ways to answer it is, if it was technical I'd say, who actually thought of an antibiotic, what actually happened is nature created it, somebody swapped, it cultivated it out. And they call that an antibiotic as if they invented it. They didn't invent it.
• 13:15
  James Graham: That's not an invention. We invent nature, because we synthetically begin with the end in mind to design what we want in our compound. And that achieves far better than he ever will has been, or will ever be able to do. And in that context, I really say it's not, you know, why didn't somebody else do it is because nobody has ever done it. People have been swapping stuff, cultivating it out, that ain't invention, they don't smart, like think they're pretty smart. But frankly, I don't think they they are, we are straight ahead. And I believe that's where the innovation and opportunity comes in.
• 13:50
  John Simboli: I can picture someone saying to you what would make your innovative idea, any less prone to becoming ineffective at some point because nature is so smart?
• 14:01
  James Graham: So the last class of antibiotics was 40 years ago.
• 14:05
  James Graham: Now, if I saw a car that was 40 years old, and they say, Look, you know, starts one in every three days now. You know, 40 years ago, this thing worked.
• 14:14
  James Graham: But now it starts now one in every three days, may or may not make it around the block. But I'd like you to pay the premium that it was priced at 40 years ago for something that's now technically an old battleaxe, that doesn't work. That's dumb.
• 14:26
  James Graham: So what I mean by that is if you have a car out there that's new technology,1 does what it says on the bottle, AKA, will kill an infection for drugs that no longer work. So I'm gonna pay a premium for that if it doesn't work out. And it just puts an obvious business case of I think, if something does work, and does deliver what it says on the bottle, AKA a new technology, not a 40-year old battleaxe that clearly has had its day in place, people will pay for that and particularly when we look to where we fit in, only unmet medical needs, only those of large patient populations. And that we do in two-fold, one, unmet, meaning no existing . . . if it was met, somebody would be in there and be pricing accordingly and similar, but, two, in that space, you have significant patient populations, sepsis is one of ours. That's the number one most expensive condition in health, double the second most expensive.
• 15:29
  John Simboli: The problem with resistant drugs is that Nature keeps playing it's part of the arms race. So I guess the question I'm getting at is, how would your new approach to doing that play into that?
• 15:43
  James Graham: You know, I, as I commented, earlier, I was the founding investor. I would never invest in a traditional antibiotic. And the reason that is, is nature is very, very smart. In the case of antibiotics and bacteria, the antibiotic is much like a lock in a case. So you got the antibiotic, and you got the bacteria. Today, the antibiotic wins; it won that war. Now, the bacteria is not in the game of losing. So it's going to do something differently when they come back knocking next time, and it's going to mutate. And it's that hypercellular mutation or survival mechanism that has always taken place, since millions and millions of years ago, will always happen and continue to happen. So expecting an antibiotic, AKA something you find in nature that'll work today, to work tomorrow or the next day. Good luck, it ain't going to happen. So how do you synthetically cheat nature, knowing that they're going to do a number of things, put on a lipid outer layer so that things can't bind to them? No worries.
• 16:53
  James Graham: Change in its gram structure or protein nature, no worries.
• 16:57
  James Graham: Become a biofilm or similar. No worries. So in our context, we know it's going to do anything it possibly can to survive. And we, instead, designed our compound to have 1000s of mechanisms of action. The best any existing antibiotic today it currently has is two, maybe three. I can tell you now, two, maybe three, you know, you might have a pistol or a machine gun and you know, a taser, they're going to work that out. I got 1000s, they're not going to work that out. And that, I think, is the fundamental to mean we work and keep on working with repeated use, which not only means a compound of some value, a compound that will continue to have value over the time ahead.
• 17:44
  James Graham: And I'll just add one more . . .
• 17:44
  James Graham: my investment, initially was, one, to identify which compounds. That's not a great place to invest. But thankfully, we did strike. And then to lodge patents and our patents we launched was the ability to work and keep on working with repeated use. So nature will always continue to evolve. But being a step ahead, and in our case, I believe, multiple steps ahead, having catered to any possible mutation that could ever be conceived, puts us in a place of power rather than reliance on what nature is given.
• 18:23
  John Simboli: Thanks for speaking with me today, James.
• 18:25
  James Graham: Great speaking with you, John.