CEO Leadership Series: James Caruso, President & CEO, Cellectar Biosciences

Jim Caruso
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HOW TO INFLUENCE A COMPANY’S CULTURE AND WHY IT MATTERS

In his 27 years as a biotech and pharmaceutical professional, James Caruso has held key executive positions at organizations of all sizes, from Big Pharma to small specialty companies to a startup. One constant throughout his career has been a commitment to shaping a positive and productive company culture.

“If we aren’t happy with our work environment, we really have nobody to blame but ourselves,” says Mr. Caruso. “We’re the ones who have the capacity to create or craft what that environment looks like and how we treat each other.”

In an interview with Ashton Tweed, Mr. Caruso discusses how he creates high-performance company cultures and how he set his current company on a new path.

You joined a series of small companies after working at some very big organizations including Bristol Myers Squibb and Novartis. Why did you leave Big Pharma?

Quite frankly, I was leading a large organization at a large pharmaceutical company with 700 to 800 people. I was at a point in my career where I understood how to be successful in these larger multinational companies and, honestly, I was a little bored. There existed excessive political dynamics and pretty predictable days. So I was looking for a more challenging and meaningful professional opportunity – and thus the transition to Bone Care International, a small, specialty pharmaceutical company with one commercial asset. We took a $25 million company and, after 12 consecutive quarters of double-digit sales growth, sold it three years later for $719 million.

A tremendous benefit of leading a smaller specialty pharma or biotech company is that you have a much greater influence on organizational direction, the decisions made on a daily basis are meaningful. You also have—which was important for me—much greater influence over the culture of the company. I believe in building high-performance cultures that are based on reward, recognition and appreciation.

In today’s environment, we’re all held accountable on a daily basis for operational execution and quarterly for financial results and performance, etc. Sometimes it’s difficult to remember that at the end of the day, people drive performance. I’m old school in that I believe one of the primary ways of building a high-performance team or organization is via culture. Understanding the importance of our professional environments and making the time to coach and develop individuals unfortunately may be a lost art in some organizations.

Where do you start when you set out to influence a company’s culture?

It is an extensive process that requires open communication, employee vesting and participation. It is important to mutually identify the organization’s culture. Focus on the drivers of high performance, such as treating each other respectfully and rewarding employees for commitment and performance. There are some simple, classic actions such as catching people doing things right, recognizing colleagues for going above and beyond the call of duty – for example, working extremely late or through the weekend on a time sensitive project. Make certain that you take the time to recognize the action, especially in front of his/her peers, for going above and beyond the call of duty. Typically, that behavior and associated recognition filter down through the organization.

Of course, it is imperative to recruit like-minded people that act as role models. I’ve always believed that when individuals model high performance behaviors, it’s a lot easier for their colleagues to better understand what good looks like. Ultimately, the goal is to create a truly robust, fun, collegial environment, in which the individual employee and collective team hold themselves accountable to a high performance standard.

You say you consider yourself ‘old school.’ Did you find co-founding a startup to be a culture shock?

For many professionals, it is difficult to transition from multi-national companies with the  massive infrastructure, resources and support to small or mid-sized biotech environments.

I’ve always been one to roll up my sleeves and contribute at whatever level of participation is required, so that piece of the puzzle was not as challenging. However, you do require a modified mindset when participating as a founding member of a company. I found it to be a different type of performance pressure, which quite frankly, further enhances sense of urgency and performance.

Participating as a company co-founder was always a professional objective and personal dream. The start-up mind set was far more challenging to achieve than the large pharma to small biotech transition. Hip Innovation Technology is a great story and the company’s success continues, the CEO has done a really nice job and we look forward to a bright future. However, although we always remained optimistic regarding the unique benefits of the company technology, it took at least 3 plus years of operating with an unknown outcome, along with a lot of blood, sweat and tears. Obviously, there is the potential for meaningful upside, however, there is significant risk associated with starting your own company and that risk includes the personal investment dollars, opportunity costs associated with your time and the potential negative professional optic if unsuccessful.

What drew you to Cellectar?

The technology.

A trusted colleague connected me with Cellectar, an oncology company that historically had struggled as a result of inconsistent leadership and strategy, however, the company possessed outstanding technology that, if appropriately deployed, could potentially have a meaningful impact on cancer treatment for patients.

Cellectar’s base technology is a cancer targeting delivery and retention platform leveraging optimized phospholipid ether-drug conjugates. Cellectar’s delivery vehicle has a targeting preference for cancer cells of approximately six to 10 to one. Regardless of the payload added, to date, the targeting preference for cancer cells over healthy cells has been maintained. The company was employing optical and diagnostic imaging agents as payloads for the delivery vehicle, interesting assets providing diagnostic imaging and surgical benefits, however, we believed the greatest patient clinical opportunity and corporate value driver was with the development of oncology therapeutics. The potential clinical utility of conjugating select chemotherapeutics or other oncology therapeutic payloads to our delivery vehicle, and disproportionally depositing more of the drug into cancer cells and less to healthy cells is extremely exciting. This would potentially reduce the amount of drug required, modify the therapeutic index, and have a meaningful effect in terms of cancer treatment. So, we rapidly transitioned the company.

It sounds like you couldn’t resist the challenge that Cellectar presented.

It represented a tremendous professional development opportunity and the challenge was intriguing, a Harvard Business School case study of a company turnaround. I believed, that, if this company could successfully pivot, create the resources and capacity to do the necessary preclinical and clinical work to optimize the potential benefits of this delivery platform, it potentially could be a really nice win for shareholders, employees and the patients that we serve. The team continues to work very, very hard to achieve this objective.

What’s your biggest challenge at Cellectar?

Effective company capitalization.

In today’s environment, financing remains a significant challenge for small biotech companies like ours. Prior to new management’s arrival, the company was inconsistent and uneven in terms of achieving milestones, which created additional financing hurdles. One of our priority goals was to establish company credibility with our external constituents and establish a successful track record of effective milestone guidance and timely achievement, which I believe we have accomplished. We also rebranded, repositioned and rebuilt the company while developing an exciting story that has resonated with institutional investors. As we begin to see the output from our research and development programs, our hope is that positive data is transformative for the company.

What lessons have you learned over the course of your career that help you as a CEO?

I’m a performance-driven individual, of course strategy and execution matter. However, if the objective is to build a high-performance company with potential for long-term, sustained success, I understand that people matter and culture matters. When individuals and teams realize that there exists a real camaraderie, interest in their professional development, that there is sincere recognition and appreciation for their contributions, guess what? Productivity goes up – and it goes a lot.

It takes time and high energy to be successful. It’s a total commitment. I believe that commitment gets a lot easier to make when we are invested emotionally. Everyone likes to know that their efforts are recognized and appreciated. It’s not a complex formula, it’s one that’s worked and it’s the right thing to do.

You mentioned the importance of recognizing people. What do you feel are the most effective ways to recognize employees?

From a compensation perspective, we distinguish between high performers and not so high performers to meaningfully recognize and reinforce the actions of team members who are going above and beyond, and behave consistently with organizational culture. When possible, it is important to clearly distinguish performance levels through compensation. Unfortunately, for various reasons companies sometimes communicate “You did a great job; therefore you receive a three percent increase. You underperformed; you get two percent.” We have much greater differences in salary range increases and the same is true for incentive compensation plans.

As importantly, its basic recognition and appreciation—sticking your head into somebody’s office and saying, “Hi, I just reviewed that report, that was very, very good and this section in particular was excellent.” It’s easy to say, “great job.” Also, find the time to recognize individuals in front of their peers. It may incent their colleagues to behave in the same way. Role models drive culture and create a company of leaders.

This approach is also helpful from a professional development perspective. Taking the time to effectively coach and counsel, “I reviewed this. Help me understand your thinking. Have you thought about approaching it this way?” Basic skills that we all learned as young managers that we sometimes forget. Company size is no excuse for not focusing on employee development. We evaluate individual professional development plans to focus on the skill sets employees require to be more effective in their current role as well as those required to get to the next level. There is open communication from company leadership to the team regarding their professional development. I believe it is fair to say that we have successfully employed experienced based learning opportunities by leveraging selected projects and other approaches to further develop employee skill sets.

What advice would you give about creating a corporate culture?

Companies are driven by people, not products. With the numerous operational distractions, daily deliverables, external constituent pressures, it can be easy to lose sight of your cultural mandate. At Cellectar Biosciences, I am fortunate to have an extremely strong and talented leadership team that is committed to the same corporate mindset and we collectively hold ourselves accountable to the tenants of a high-performance culture. You can disagree on strategy, you need alignment on culture. Over the course of my professional career, I’ve had the privilege to be surrounded by high quality, high character colleagues that are the best and brightest talents and importantly, are like minded culturally.

Ashton Tweed would like to thank James Caruso for this interview. If your company needs help from members of the Ashton Tweed Life Sciences Executive Talent Bank, we can supply that assistance either on an interim or a permanent basis. Additionally, if you are among the many life sciences professionals affected by the changes in the industry, Ashton Tweed can help you find the right placement opportunity — from product discovery through commercialization at leading life sciences companies — including interim executive positions and full-time placements. In either case, please email Ashton Tweed or call us at 610-725-0290. Ashton Tweed is pleased to continue to present insightful articles of interest to the industry.

Jim CarusoJames Caruso

James Caruso became President, Chief Executive Officer and a Director of Cellectar Biosciences’ in 2015. Previously, he served as Executive Vice President and Chief Operating Officer at Hip Innovation Technology, a private medical device company he co-founded. Mr. Caruso was also Executive Vice President and Chief Commercial Officer of Allos Therapeutics, Inc., an oncology company acquired by Spectrum Pharmaceuticals, and Senior Vice President, Sales and Marketing at Bone Care International, Inc., a specialty pharmaceutical company acquired by Genzyme Corp. He additionally served as Vice President of Neuroscience Specialty Sales at Novartis, Vice President of Primary Care and Specialty Sales at BASF Pharmaceuticals-Knoll, and held senior sales and marketing positions at Bristol-Myers Squibb Co. He earned a Bachelor of Science degree in finance from the University of Nevada. Mr. Caruso currently serves on the Board of Directors for Hip Innovation Technology. He divides his time between Cellectar’s headquarters in Madison, Wis., and Madison, N.J., where he and his wife live. The couple has a son and daughter.

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