Faculty Entrepreneurs: Meet Dr. Seth Orlow
Meet Dr. Seth Orlow, Professor & Chairman of NYU Langone's Dermatology Department, co-founder of Anaderm, a venture capitalist and an investment banking advisor.
Dr. Seth Orlow joined NYU in 1990 as a junior faculty member during a period of growing interest in lifestyle drugs, the most notable of the period being Viagra. Soon, Orlow and his dermatology colleagues found themselves in discussions with Pfizer on how to leverage Pfizer's library of drug compounds to identify active ingredients for non-traditional medical problems such as skin discoloration and wrinkles. Anaderm was founded in 1995 to develop such "cosmeceutical" drugs, and Pfizer exercised their options to acquire the company in 2002.
We sat down with Dr. Seth Orlow to learn a bit more about him:
Tell us about yourself. How did you go from being a doctor, to an entrepreneur, to a VC and then an investment banker?
A lot of the things I do and have done are things I never thought I'd be doing. I didn't have a business thought in my head until 1995 or so.
I trained as physician-scientist before my medical training as a dermatologist and joining NYU. It was through my research at NYU that I started Anaderm, and through building Anaderm that I became involved with venture capital. Through venture capital, I met the VP of Marketing at Acorda, a biotechnology company, who later became the CEO of SkinMedica, a company to which I ended up licensing technology developed in my lab at NYU. She later introduced me to the founding partner (the former director of M&A at Revlon) at Pharus, an investment bank where I'm now an advisor. You never know who you'll meet and where those relationships will take you!
What did you learn from Pfizer's acquisition of Anaderm?
So much! I learned about how a major pharma company discovers and develops drugs, drug design, intellectual property and licensing and medicinal chemistry. Also, Pfizer hired Boston Consulting group to analyze Anaderm and think through their options. Meaning, should Pfizer acquire Anaderm outright, should it sell, should it bring in outside investors, etc. That process also piqued my interest in venture capital.
You worked on Anaderm for six years before it was acquired. Did your passion ever wane?
Well, for my three colleagues, Anaderm was about getting a lot of research dollars to help them do the research they wanted to do. They were disinterested in the business side. It was the opposite for me; I became very interested in the business side and used the opportunity to learn as much as I could about it. When it was over, I felt that I had learned a lot, had made some money and gained experience that I could parlay into other things I wanted to do, such as venture capital.
How is being a doctor different from being an entrepreneur? Where does it overlap, and where does it converge?
I think that science and entrepreneurship are complementary. You need to have technical as medical research skills. But, being a doctor or scientist doesn't make you a good investor or a good businessman.
Did you ever think you'd become an entrepreneur?
Am I really an entrepreneur? I'm not sure, I don't look at myself like that. I've never had the courage or convinction to leave my post to focus full-time on other things. I never thought in the beginning that I'd be doing this. I had no idea. (Note: Orlow's doubt expressed here is known as impostor syndrome. Even he is susceptible!)
What was NYU's entrepreneurship environment like in 1994, and how has that changed over time?
It was grim! Here's a sad fact: at the time, the person who was going to be the CEO of Anaderm wanted us (the founders) to have much more stock in the company. The idea of a business coming out of medical research was so new to NYU at the time that our ownership was severely restricted by the university. That would never happen today! Now, NYU, and the environment in general, is much more founder friendly.
Also, at that time, a faculty member could not have held a C-level role at a company, whereas they could at Stanford or Berkeley. We couldn't fathom that, back then and that has changed.
This post is the first in our new Faculty Entrepreneurs series, sharing their experiences commercializing their research via startups.