George Rathmann: Amgen's Giant
As part of his battle against kidney disease, George Rathmann receives a dose of Epogen almost every day. He revels in the ritual, and not just because the drug helps him fight the anemia caused by his dialysis treatments. Rathmann's satisfaction stems from his very personal role in getting Epogen to market at Amgen Inc., the biotech giant he co-founded in 1980. An engineered form of a human protein that stimulates red blood cell production, Epogen was one of the world's first biotech blockbusters, surpassing $1 billion in annual sales in 1996.
Amgen, which turns 25 this year, didn't invent the technology that turns human proteins into drugs -- rather, it built on discoveries made in academia. But Rathmann did teach the industry how to turn lab breakthroughs into billion-dollar products. And even as he struggles with illness, Rathmann is still helping to get biotech startups off the ground.
A charismatic chemist with a penchant for business, Rathmann was working at Abbott Laboratories (ABT ) in the mid-1970s when biotech pioneers perfected the technique of splicing DNA from one organism into the genome of another. The technology piqued the interest of many drugmakers, including Abbott. But executives were so fearful of the unproven science that they isolated the new research teams in ultra-secure labs. At Abbott, for example, any scientist who missed a day of work had to undergo a thorough physical exam before returning to the lab.
Rathmann feared the overprotective approach would suffocate discovery. So when venture capitalists and a scientist friend approached him in 1980 and asked him to help start a company called Applied Molecular Genetics Inc., he jumped at the opportunity. The Thousand Oaks (Calif.) startup, later renamed Amgen, sat in a concrete building partially occupied by an evangelical choir. It was a step down from Abbott, but to Rathmann it was the perfect setting for scientists to seek out new therapies without restrictions. "At Amgen, you could leave your lab door open," he recalls.
Born in Milwaukee, Rathmann was turned on to science by his older brother and brother-in-law, both chemists. After earning a PhD in physical chemistry from Princeton University, he joined 3M (MMM ) in 1952. Rathmann worked his way through the ranks, leading such projects as 3M's entry into the U.S. market for X-ray film. In 1975 he joined Abbott, where he eventually became vice-president for R&D.
At Amgen, Rathmann's mastery of both science and finance helped him spot opportunities. In 1984, shortly after an Amgen scientist cloned the gene to make Epogen, Rathmann got a call from Kirin Brewery Co. (KNBWY ), Japan's largest beermaker. Kirin offered to lend its fermentation expertise to Amgen's manufacturing process in return for joint commercialization rights. Despite the unlikely pairing of beer and biotech, Rathmann struck a deal that secured $12 million in much-needed funding. "We could see our last dollar," says current CEO Kevin Sharer. The Kirin partnership "is key to our history." In 1983, Rathmann led Amgen through a $42 million initial public offering.
In 1989 the U.S. Food & Drug Administration approved Epogen. The drug and related anemia remedies now bring in more than $8 billion a year in sales. Amgen remains the world's largest biotech, with annual revenues of $10.6 billion and a market value of $101.5 billion -- larger than Abbott's.
Rathmann retired in 1990. At 77, he consults for biotech startups, encouraging the study of stem cells and other new technologies. Could stem cells solve the most confounding ills? "Heavens, yes," says Rathmann. "It's the master cell."
By Arlene Weintraub