A Long Shot

After Andersen's demise, targeting HIV

It had been a long time since Joseph Berardino, the Andersen Worldwide CEO who saw his accounting firm collapse amid the Enron scandal, had been a student. Yet in 2004 he found himself huddled over biology textbooks with tutor Shelley Phelan, an associate professor of biology at his alma mater, Fairfield University in Connecticut. Phelan says Berardino was "a very quick study."

That's good, because the 56-year-old has a lot riding on his new gig as a science guy. In late 2005 Berardino took over as CEO of Baltimore-based Profectus BioSciences, an 11-person startup trying to develop a vaccine and therapies for HIV. Profectus was spun off from the Institute of Human Virology to commercialize its work.

The institute was founded and is run by Dr. Robert Gallo, renowned for his work on HIV. Gallo has weathered storms of his own, including lawsuits and government inquiries into whether he overstated his role in identifying HIV and developing a blood test for it in the 1980s. Gallo was exonerated.

On the vaccine front, Profectus aims to target the virus as it attempts to enter a cell, when the virus' myriad strains all assume a similar shape. Profectus has partnered with drugmaker Wyeth, and studies in animals are under way. Profectus' other HIV therapy would cool the body's overheated immune system after it's infected.

Berardino, who was not charged with wrongdoing by the government, plays down talk of redemption. "It was a wonderful 30-year career," he says of his Andersen days. "I know this sounds trite, but my family loves me, and that's all that matters." Talk to those who know him, though, and you sense Berardino would like to be associated with more than Ander-sen's implosion. Gallo says the board never thought twice about hiring him: "I do believe underneath this he wants to show he's done something good for humanity."

Berardino first met Gallo in 2003, at the request of a mutual friend. Berardino admits that, at the time, AIDS "wasn't high on my list of social issues." But after talking with Gallo and his colleagues, Berardino was "blown away by what they were doing and the magnitude of this problem," he says. "It was a very moving day." Berardino saw how he could help. For starters, Profectus needed assistance with finance and governance issues, two areas in which Berardino could contribute.

Berardino joined Profectus' board in 2004 and soon became its nonexecutive chair. Still a science novice, he considered moving into management and asked friends in the venture capital and investment banking community a blunt question: "If I came to you for money [as head of a biotech], would you laugh out loud or would you think this is interesting?" They said the latter, Berardino recalls. He says he feels quite comfortable at a startup: "No, I don't have 85,000 people in 84 countries," he says. "But we are global, and this is a really big problem."

Berardino's role is to bring business discipline to Profectus. He has put more formal controls in place, including budgeting procedures. "He knows where every dime is," laughs Gallo. Profectus has raised $5.25 million in venture capital over the last two and a half years. Berardino is spearheading an additional fund-raising round to help finance, among other things, the HIV therapy work. That could involve linkups with big pharmaceutical companies. "I'm the world's expert in partnerships," he contends. Knowledge that no doubt has been hard-won.

By Amy Barrett

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