In this next episode of The Heidrick & Struggles Leadership Podcast, Heidrick & Struggles’ Martin Holm speaks to Thomas Holm Pedersen, the CEO of NMD Pharma, a clinical-stage biotech company with novel treatments for neuromuscular disease. Pedersen shares how he founded the biotech company and became CEO, sharing the capabilities he needed to learn right away. He discusses the foundational strengths that technically experienced CEOs have that nontechnical CEOs may struggle with in leading a biotech, as well as how he keeps up with different aspects of the growth of the organization including fundraising, hiring key talent, and fostering that culture of growth. Finally, he shares his advice for other biotech founders coming from academia and how he sees the future of the biotechnology industry unfolding.

Below is a full transcript of the episode, which has been lightly edited for clarity. 

Welcome to The Heidrick & Struggles Leadership Podcast. Heidrick is the premier global provider of senior-level executive search and leadership consulting services. Diversity and inclusion, leading through tumultuous times, and building thriving teams and organizations are among the core issues we talk with leaders about every day, including in our podcasts. Thank you for joining the conversation.

Martin Holm: Hi, I’m Martin Holm, partner in Heidrick & Struggles’ Copenhagen office and a regional managing partner for Europe and Africa in the Healthcare & Life Sciences Practice. In today’s podcast, I’m excited to speak to Thomas Holm Pedersen, CEO of NMD Pharma, a clinical-stage biotech company with novel treatments for neuromuscular disease. Thomas cofounded NMD Pharma and has been CEO of the company since its inception in 2015. During this time, NMD Pharma has transitioned from an early discovery stage to a clinical-stage company. Thomas has led various financing rounds, including raising one of the largest Series A investments in the sector in Europe in 2018. The scientific basis of NMD Pharma comes from academic work conducted by Thomas and colleagues at Aarhus University in Denmark, where Thomas obtained his PhD from, including having published more than 40 high-ranking papers. 

So, Thomas, you basically took your idea from the lab as an already distinguished scientist to founding a start-up and staying at the helm leading it. Today we’re lucky to benefit from your learnings and hear more about your journey as CEO. So welcome and thank you for taking the time to speak with us today. 

Thomas Holm Pedersen: Well, thank you very much, and thanks for the invite. I’ve been looking forward to this. 

Martin Holm: I would like you to take us back a number of years to when you realized that it was time to change your career from professor to biotech founder and CEO. Which longtime strength did you draw on to make that shift happen? 

Thomas Holm Pedersen: Well, I think first of all it’s an interesting topic because somehow there’s no specific point in time when I had a transition in my mind. It’s been kind of a smooth process from having an idea, even going back to my own PhD—that’s actually where the idea first comes from. And then gradually pursuing this idea and hoping to make, you know, one day have something that would benefit patients. That’s of course the vision and mission of what we’re doing here. And so it’s been kind of a pursuit to achieve this, and to get there, we realized we had to expand and go out beyond the barriers of the academic world. We had to form a company; we had to keep pursuing this idea and actually form NMD as it is today. And it’s been a journey, where it’s come from this early idea and into now, approaching a late-stage clinical company, which we’re getting to. So it’s hard to say that there’s one particular transition point where it happened; it’s been more of a gradual process. In some respects, I feel I’m still doing the same—I’m using very different tools—but I’m somehow still doing the same, hoping to develop treatments for patients. So there are elements of the same thing. In terms of strength, I think a fundamental element in all of these discussions and all the discussions you have with various external interested parties is science; you need to be strong, scientifically founded in order to have the discussions. But another element I think I took away from the academic time is teaching. Because having been teaching medical students for more than 20 years and dealing with complicated topics and breaking it down to something which is simple is exactly what you’re trying to do when you do pitches and explaining to investors, or explaining to patient organizations what we’re trying to do here. So there’s definitely the scientific part, but there’s also the teaching part that I took away from that time, I think. And then maybe finally, you could also say that the fact that we came from a fairly large research group meant that there was already some understanding of, you know, managing people, being productive, and working together. So there’s a cultural aspect that I think I took away from it and that I think is still thriving in NMD today. 

Martin Holm: And what new capabilities would you say that you felt that you needed to learn right away? 

Thomas Holm Pedersen: Right away when we started, I mean there were obviously a lot of things I was not trained in, in terms of more on the business side. This means of course financing and looking through investment agreements and understanding what the various financial documentations are, and the various governance aspects of running a company, what those entail. This was something that I mean I think was key to start with, but now has become more of a well-understood topic. And then also you build a team around you to support you on some of these things as you as you go forward. 

Martin Holm: And what do you think may be different founders now compared to when you did it? 

Thomas Holm Pedersen: Well, there are several things I would say that are different. First of all, I would say there are now more people who have done it, so there are more stories to learn from. There are more people to contact to get advice from, that’s one thing. This may also mean though that there is more competition, so the competition may also be more fierce to actually achieve. And what I’m thinking about when I say this is mainly in getting the investments to start the companies. So that has changed. I think there’s another change that I’m seeing and that is that as a scientist, you are not familiar with the topics I mentioned before, more business-related topics and the finance-related topics. So investors will naturally wonder whether you can actually, whether you’re up for that challenge of making this transition and understanding these elements. And I think now we have seen several times that this is possible for scientists to make that transition. So when I started it was more of an important topic to discuss: “Well, you know, you’re a scientist, can you ever be a CEO of a company?” I think that has changed somewhat, that attitude, I think they’ve seen it. It’s really not down to what your basic training is; it’s really down to who are you as a person. I think that’s the key. And I think people understand that now, so I think that’s a benefit for people who are starting now. 

Martin Holm: It’s a great observation. And a nice sort of segue in to a curiosity around what are some of the foundational strengths that you see that technically founded CEOs have that nontechnical CEOs may struggle with in leading a biotech? 

Thomas Holm Pedersen: Yes, I think the key, and that is the real value driver in a biotech company that’s developing drugs or maybe also other aspects of biotech, is it’s difficult. I mean scientifically it’s difficult, technically is difficult, but you have to explain it in a simple way often to get people to understand what you’re trying to do. It’s very hard to explain something complicated unless you understand it very well actually. So you have the strength as the technical CEO that you typically understand the topic very, very well, and that gives you a very strong foundation to stand on when it comes to the scientific discussions or technical discussions. And after all, they will be typically a very large proportion of the various discussions you’ve got to have. Not all of them, but they’re going to be very important. So I think the technical CEO, at least early-stage companies, have a major benefit on that front. The caveat is that you also have to realize that you can’t keep doing the same as you were doing before, so you have to be able to let things go. And for instance, if you’re doing a lot of science before research, probably have to let that go because you need to do new things now. So that is somewhat of also the challenge, you could say, with this for some.

Martin Holm: So let’s talk a little bit about, more about being a CEO. You’ve gained such a wealth of experience and insights from the company’s success and journey so far. How do you as a CEO keep up with the growth of the organization as you move forward?

Thomas Holm Pedersen: First of all, it’s very important that you accept that you can’t keep doing what you were doing before. You have to accept that your role will be changing and that it has to change because the organization is growing. You get more capabilities in. You get even more areas that will come into the company, so you have to really accept things are changing. You have to be open-minded to learn. You have to be interested to learn. And for me it’s very important to—a basic tool, I guess—to read, to study, to learn about new things through actually finding the time in your calendar to focus on the topics where you need to be able to keep up. And try to be proactive, thinking ahead. What will I need in a year’s time so I can actually have the insight so I’m ready for what’s coming? And of course and very importantly you build a team around you, and you use the various contacts you have, including perhaps your own board and investors, to really sort of discuss these things—and you can then develop your insights. But be open for learning; form your own opinions based on what you’re learning from other people. 

Martin Holm: You touched on some of the aspects but as CEO, some of the mission-critical elements are fundraising, hiring of key people, particularly bringing on C-suite leaders with expertise, who can then work together as a cohesive team. What have you learned about attracting and retaining top talent and leading the executive team?

Thomas Holm Pedersen: You have to have first of all a very, very clear role of how you want to mature and develop your team. You also have to have a very clear understanding of the culture you want to have in your team and how you want people to work together. And then you make sure you have—I would say what’s really, really important when you go out and hire people, you find people whom you can work with, I mean at a personal level. You’re going to be spending a lot of time together. You’re going to be spending good times together; you’re going to be spending hard times together. You need to have the, let’s say, the robustness and the personal interactions that will allow you to have, you know, complicated discussions as well as the more sort of, if you want, positive discussions. So don’t compromise on the personal relationship. Just your sense you have of chemistry, how well you’re working together, is extremely important, and invest in your team as well. So when I have been looking for C-suite, I’ve had the pleasure of working with excellent recruiters, having a clear role we were pursuing, and then having a common understanding of what my personal expectations are and how the collaboration should be with this individual. 

Martin Holm: Thomas, how do you ensure succession planning, especially when leadership is dependent on special expertise along the different phases? 

Thomas Holm Pedersen: In terms of sort of actually succession planning, I can’t say I have sort of a distinct succession plan worked up. What I do at the moment is I’m very focused on having one-on-one conversations with all of my direct reports and all of the really important employees in the company. I have a very good understanding of where they aim to go, what their plans are, which means I understand very well in the organization who would aspire to new roles. I also have, even at the point where, you know, it’s also at the personal level, so if there are some family-related matter where we need to change the role of something like that, I would be aware of it. I also make sure that our culture is one where people understand what’s going on in the different areas of the business. We share knowledge, so we train each other in that way. So people are being trained from the inside in and to take up new roles if that becomes relevant, but I cannot say that I have sort of lined people up for taking over specific positions. I think the best we can do is make sure we are trying to be ahead of the game, understanding what the ambitions of different people are, what may be family obligations, but also then have a transparent understanding at different levels in the organization what a particular job is actually doing. And so we’re training people always to become better and better. 

Martin Holm: And how do you, within that, foster a culture of growth within both the top team and the organization?

Thomas Holm Pedersen: Yes, so I think it’s extremely important, especially as you grow, that you don’t lose sight of the idea of actually invest gradually more and more into the culture that you’re developing. So we have been running some processes where we have been defining company values, and we really use them very actively in the organization. We invest a lot within the teams. We have sessions or off-sites where we actually discuss how we operate together; we learn more about each other. And we speak a lot about primary teams versus secondary teams, where our primary teams is kind of the team where you really belong. And then you go and you work in other teams, but people understand very well where their primary teams are and what their secondary teams are, and what it means to be in a primary team. That’s super important for us, and it’s important to take time to have these discussions so people are all aligned when we have various meetings. We spent time on giving each other feedback on strength, weaknesses. Also as the conditions are changing, because it’s quite different from whether you’re in a financing round, you’re pursuing financing, or whether you have secure financing and you’re executing on a plan—those are different boundary conditions for how we work together, and so we should always be investing into how the team is operating under these conditions. And do it, so to speak, when everything is going really well, take time, even though things are moving fast and well, take time still to invest in the team and build relationships is key. And then at the corporate level or the company level, every year we go on an off-site where we have really very little focus on science. We mainly focus on being together and having some cultural elements in those discussions as well. 

Martin Holm: So here’s the literally multimillion-dollar question, Thomas. What’s your advice for other biotech founders coming from academia, as well as other aspiring biotech founders? 

Thomas Holm Pedersen: Looking back, what perhaps some of the things I could have done smarter and the mistakes I made, I think I could have avoided a lot of those if I had been speaking to people who had done it before. So make sure to reach out to people; use people around you. Really very few people would not be interested in giving advice if you are in a situation of thinking about whether to spin something out from university, so reach out for sure. Be ready to change your mindset from being the expert in what you’re doing to letting that go to some extent and have other people being the expert, and it becoming a much more let’s say multidimensional task you have ahead of you. It’s a super meaningful thing to do, and it feels very gratifying doing it. And for those who are very scientifically inclined, there are many, many opportunities to do excellent science. You don’t have to be CEO, you can be a scientific key person in the process and science is also going to be, remain the key value driver in a spinout from a university. So don’t be worried that you will compromise the science, that’s not going to happen for sure. 

Martin Holm: As we look into 2024, how do you see the path forward for the biotechnology industry? 

Thomas Holm Pedersen: I was just at the JP Morgan conference in San Francisco and the takeaway from that is that there is a more positive spirit, I would say, amongst investors, amongst the larger organizations. There is more interest in deal-making, in investing. So I think we’re looking in to slow albeit positive movement toward more, let’s say, active investment environment, and also partnering and M&A market. So I think there is, there are more opportunities coming. So I have a positive view on it. It’s not going to go fast, but it’s moving in the right direction. 

Martin Holm: Encouraging to hear. Thomas, thank you for making the time to speak with us today. 

Thomas Holm Pedersen: Well, thank you.

Thanks for listening to The Heidrick & Struggles Leadership Podcast. To make sure you don’t miss more future-shaping ideas and conversations, please subscribe to our channel on the podcast app. And if you’re listening via LinkedIn, Twitter, or YouTube, why not share this with your connections? Until next time.

About the interviewer 

Martin Holm (mholm@heidrick.com) is the regional managing partner of the Healthcare & Life Sciences Practice for Europe and Africa and co-leader of the Medical Technology sector. He is also a member of the Industrial, Private Equity, and Corporate Officers practices. Martin is based in Heidrick & Struggles’ Copenhagen office.