From Games to Cancer Research: Why Drug Discovery Is an Economics Problem | Javier Tordable (3/4)

Intro - 00:00:06: Welcome to The Biotech Startups Podcast by Excedr. Join us as we speak with first-time founders, serial entrepreneurs, and experienced investors about the challenges and triumphs of running a biotech startup from pre-seed to IPO with your host, Jon Chee.

In our last episode, Javier shared how he rose from a new Google hire to tech lead in six months, built a platform that became a top company OKR, and taught himself supply chain engineering from MIT at night while building Google's cloud data center backbone by day. If you missed it, check out part two.

In part three, Javier talks about his years as technical director in the Office of the CTO, working with the world's biggest gaming companies, and how the death of his father from cancer became the turning point that pulled him into life sciences. He shares how he spent his final years at Google self-studying biochemistry and pharmacology, working with EHR vendors, Schrodinger, and population health companies, and developing a sharp view on why drug discovery's biggest failures are economic, not scientific.

Jon Chee - 00:01:29: You know, you're spending a lot of time on supply chain. I think you did that for a couple years. When did you know it was time to move teams out of supply chain?

Javier Tordable - 00:01:37: I don't know if it was something that suddenly happened, but, you know, just like any other big org, you know, there were reorgs. Right? So, like, the person that I really enjoyed working with ended up leaving Google, you know, ended up going to become the city of of American Express where they're kind of you're going to do something different. Got on a VP, and I think it was a good time for me to start looking at what else is out there.

And at the time, the thing that was very interesting, of course, was cloud. Right? Latel was the major bet. So I got a chance to join a super, super interesting team that was called the CTO. She was reported to a CTO, of Yep. Yep. Of WorkCloud. Very, very small team, but super senior folks, you know, doing really interesting stuff. Lots of freedom, you know, to operate to really unusual kinds of things for a large company. So I I left and joined the of OTO, which is called OTO. And I spent seven years there, which was the longest time that I spent in a team at Google. But I was also very lucky that I was able to to work in a wide variety of different things.

So my first, like, three and a half years or so, especially at the end part of that, I sometimes tell people, it's probably the most fun job that you could imagine. Okay? So I was a I was a technical director within Zork, and I was working with basically every major video game company that was a Google Cloud customer. So I would like to spend time with Nintendo and I just to work quite a bit with Unity. Right? Those were interesting things, but electronic cards, Ubisoft, you know, you name it. And, you know, we'd essentially try to see if Google could help them make better games using Google's technology. Right? So Stadia, you know, was coming out around that time, but you had cloud. A lot of games were starting to use cloud.

So one of the examples I would tell all the time to people was, like, I think it was Super Mario Run. You know, this game had a a global leaderboard, right, so you could see, you know, who's best in the world, but in real time. And all that was running on Google Cloud Spanish. Right? You know, it's massively distributed, high performance database. It's essentially the same system that runs Google Ads, right, for Google worldwide. Right? Like, of course, you know, battle tested, super high scale, absolutely fantastic technology. It uses quantum clocks for synchronization of databases around the world. It's really cool stuff. Right? So, like, we would sell that stuff to people. Right? You know, back then, it was when it was all these things about using generative AI for making creatives, for making assets, for video games or something to come out. So it was a it was a fantastic time, and I really, really enjoyed it. I spent, yeah, about three and a half years doing that, and it was a lot of fun.

You know? Like I said, I sometimes tell people, you know, I I remember that time very, very fondly because sometimes I would go and meet this video game company, and they would say, hey. You know? You wanna know about, like, this game that we're making. Right? Yeah. Like, we would have this creative brief that would tell us about, like, how the reason about making a new game and and all the stuff. So that was very unique, very special.

And, you know, unfortunately, you know, about six years ago, something like that, my father passed away because of because of cancer. And I decided that I wanted to do something more meaningful than keeping people attached to a screen. So I pivoted entirely to life sciences. So, like, up until now, you know, I had always a little bit of interest in in different aspects of biology and science and so on and so forth, but I definitely did not know about life sciences. I did not know about chemistry or biology or, you know, like, what do people do in a lab, right, and so on and so forth. So about five and a half years ago, six years ago, switched, and they decided, okay. Now I'm a life sciences person. I think I felt empowered to that because, as I mentioned, like, when I joined supply chain, I didn't know anything about supply chain. Right? When I joined, I was like, what is this, you know, supply chain? You're just shipping packages from one place to another? Like, what do you actually do here?

Jon Chee - 00:05:16: Yeah. Yeah.

Javier Tordable - 00:05:17: And then by the time I finished, I was, like, participating in conferences, you know, having discussions with professors about, you know, how do you run certain processes one way or another? So I went through a little bit of that similar process in life sciences. This was actually when there was a series of courses from the Harvard Medical School called HMX. They started popping up. So I thought, okay. I'll do that. I started learning biochem and pharmacology and physiology and sort of went through a lot of that stuff.

I started working with customers within the life sciences and health care space. So I worked briefly with Meditech, for example, the EHR vendor. I think I I built, like, myself, personally. I I built the first system that fed real EHR data to a large language model. I worked briefly with Schrodinger, the computer simulation company. Schrodinger was a Google Cloud customer. I worked a little bit with Wellframe. They were doing, like, population health stuff. They ended up being acquired by Blackstone. And I also have a good friend of mine who's one of the founders of that company, you know, and a variety of other folks, you know, within both the health care space, you know, medical systems, hospitals, insurance, etcetera, etcetera, etcetera, to, the life sciences proper kind of space. You know, people actually trying to find novel molecules.

And I think the three and a half years, four years were also a learning experience. Right? So I I got a chance to essentially learn a little bit here and there all the way from you're a scientist. You're doing some experiment to try to figure out what is the pathology of some specific disease all the way to, like, you know, if you're an insurer, you know, do you approve this claim or not? Right? And then, you know, like, you wanna pay somebody to run an app to keep track of whether somebody's taking their meds. Right? So the entire literally, the entire spectrum of from an idea to, like, delivery of care in the home or whatever. Right?

And I think that was very, very instructive. And, honestly, like, it seems hard, I think, for me to imagine of any other place, any other team where I would have had such wide variety of experiences and the learning that went with it. Right? So I'm still in touch, of course, you know, with a lot of these folks, right, that I get the chance to work with super bright, you know, real, real, smart people. Right? And I also remember, you know, my time at Opto was fantastic. It was definitely one of the highlights of of my career.

Jon Chee - 00:07:30: Very cool. And it kinda reminds me of, like, what you're saying when you're, like, growing up, kind of like the self learning. You you're like, I'm gonna learn computer science, you know, like, on my own. And you're like, alright. I'm gonna learn life science, like like, on my own, virtually, you know, kind of a independent study. Or I guess let me back up. Was it a lot of independent study, or were there, like, people within the Google health care life sciences group that were just, like, shepherding you or, like, showing you the way?

Javier Tordable - 00:07:57: I'm not sure if there's there's much mentoring happening. You know? Of course, it happens, but it's definitely very different from a formal program, right, like you would do in in university. Right? I think you're in in school and college or whatever, like, the structured way that you typically learn things and, you know, just maybe a little bit of flexibility as well, but there's a way that things are typically done. In a job environment, this is, of course, a little bit different. Right? Like, some companies maybe have more formal programs, but Google didn't. And I think I've always been very comfortable learning on my own. I figured out what I need to do. So a lot of it was, you know, some of these HMX courses. Some of it was just reading books, talking to people, all that kind of stuff. You know, one of the things that I noticed very early on was that life sciences is not very welcoming to people from outside of the life sciences.

Jon Chee - 00:08:42: It is not. It is not.

Javier Tordable - 00:08:44: It is absolutely obvious. Right? I used to joke with people in the two thousands or 20 tens. Right? Like, you could be a biologist and you do a six week JavaScript boot camp, and then you go and put, you know, front end engineer in your resume. I like to run do an interview or some, you know, or a job or whatever. Right? But imagine the opposite. Imagine you're a computer scientist and you spend six weeks reading molecular biology of the cell, and then you call yourself, you know, computational biologist. Like, people will laugh your way out of the room, you know, very, very quickly. Right?

Jon Chee - 00:09:13: Yeah.

Javier Tordable - 00:09:13: So I think, you know, maybe one of the issues that the life sciences, you know, in general has, I have hundreds of them, right, is that as a field, it is not only welcoming to people that come from different intellectual spaces.

Jon Chee - 00:09:27: Yep. I'll even say that it could be not welcoming even if you are an insider. Like, there's, like, fiefdoms.

Javier Tordable - 00:09:33: Yeah. Yeah.

Jon Chee - 00:09:33: There's, like, fiefdoms. And, actually, one of the reasons why I keep doing this podcast is, hopefully, there's no really way I can measure it, is to kinda, like, break down those walls. Like, people have to understand that if you're gonna do anything of import in science, it's gonna take a lot of different people from different walks of life and perspective. And this story, I've definitely told numerous times, but it's like I stopped being at the bench in 2011. And when I talked to my colleagues in the lab who ultimately wanted to continue staying in academia, but I wanted to go into business, particularly finance, oh, they were like, what the fuck? Like, are you serious? I literally got, like, kicked out of labs and offices for even daring talking about business. And the ironic part is, like, the people that, like, kicked me out now can't stop talking about their biotech company that's come out of their lab and are, like, commercializing. I'm like, guys, like, can we make this a more welcoming environment? Like, we all wanna, like, play a part, but maybe not in the way that you wanna do it. And I think it's a bit of a problem, in my opinion.

Javier Tordable - 00:10:47: Yeah. Yeah. No. I mean, so that's a very interesting point. Right? And, like, maybe a bit of a longer discussion. But I feel like a lot of problems in western society in the way that we fund research, develop new cures, new drugs, new devices, and then eventually enable people to have that care and then pay for it are economic problems. Right? They are not science problems. They are not engineering problems. They are not technical problems. Right? They are purely economic problems.

In biotech, people sometimes, you know, complain about the price of drugs. Right? Like, you know, it's like one of the things that unless you're from the health care field, right, you kind of don't really understand. Right? But you would go and talk with somebody, and they're like, well, but aspirin, you know, costs a cent to manufacture. Right? You know? Or my drug x costs a cent to manufacture. Why does it cost $20,000? Right? And then you're like, well, because the company that made it, you know, spent a billion dollars, and they have to recover their money somehow. If they do not recover their money, they will not be a company number two, number three, number four, and then that's it. All the drugs that you have today, that's it. You wanna cure more diseases? You cannot. Period. Right? People just do not understand the basic economics of of drug discovery.

And then again, you know, the same thing. You know? Like, folks ask, why does it take twenty years to come up with a new molecule? Just find the molecule and give it to people. Right? Like, you know, if you're a cancer patient and there's a clinical trial, why does it take seven years for you to wait? Like, people would die. I was like, well, part of the reason why it takes longer is economics problems. Right? Like, you know, because these things are incredibly expensive. You know, the biotech needs to raise hundreds of millions of dollars because they can't even afford the trial. Then the doctors want to get paid. Right? Like, you know, you have to pay for all the insurance. You have to pay for all these consultants and reviews and so on and so forth. That's why things take longer. Right?

If you had a magic wand and say, let's fix the economic problems of it. Right? Like, you know, you're going to say you have maybe a different political system where research is paid in a different way. Right? And, you know, maybe you would be able to drastically accelerate the time that it takes to do these things. Maybe you'll be able to cure diseases, you know, better than we can today, right, and so on and so forth. People kind of tend to assume that, well, there's just like challenging science problems. You just don't know how a disease works or or how a molecule is going to react. I'm not even sure that is the most important part. Right? And I think the most important part is who's going to pay for it? How does, you know, every single step get funded? You know? How do you go all the way from beginning to end? And then if you can actually figure that out, right, the science will come. Humans are smart. Right? You know? We can solve problems. What we cannot do, right, is make up money from nothing. Right? We cannot make up resources from anything. Right?

Honestly, it's the exact same way within the care side of the world. Right? In The US, of course, the way that care is delivered and paid for is absolutely ridiculous. Right? As a country, right, The US spends, like, what is it, twice, three times more based on the quality of the results than any other country in the world. I mean, of course, part of it is people enjoy higher salaries. Right? Part of it is pharmacy benefits managers that charge, you know, massive margins on top of cost of drugs. Right? Pharma companies are not necessarily allowed to sell directly to customers. You know, you could argue whether that is a good or a bad thing. Right? Hospitals have staffs that are like you know, what is it? On average now, there's more administrators in hospitals than doctors. Right? You know, of course, all those things take up certain amount of money. Right?

And, again, if you had a magic wand that you would say, you know what? You know, I'll just have a system where I just remove all that overhead inside of the way that that care works, you could probably save half your money, literally half or a third of your money. Unfortunately, a lot of it is economics problems where the incentives are very misaligned and getting worse. And I don't wanna be pessimistic. Right? I don't know. Like, people don't like to listen to Pascara and say, you know what? The world is going to shit. Right? But I think there are no good incentives to kind of revert any of that stuff. So, unfortunately, things are going to keep getting worse. They are going to keep getting more expensive. Your health insurance premiums are going up next year. I bet you I mean, I don't know who may be listening to this, but if you are in The United States, you are going to pay more for your health insurance next year than you did this year. If you're a doctor, you're going to have more pressure. Your appointments are going to get shorter. You know? I hope you enjoy the twelve minute appointments because they are becoming ten minutes, you know, a couple of years from now. Right? Unfortunately, that's just the reality of of where things are, and I don't see a really great way to change all that stuff. Maybe we'll change topics and go to, like, more happier stuff. No. No. No. No. And, like,

Jon Chee - 00:15:12: the biotech artist podcast probably has a general happy go lucky reputation, but it's not all puppies and rainbows. And sometimes a part of me, I'm just like, I'm speaking for John, and maybe it's got, like, this punk rock, like, Berkeley upbringing I have where I'm like, just like, fuck it, burn it all down. It's kind of like you just like, we gotta shed. You you there's, like, these layers. There's just, like, this calcification of, like we talk about process and documentation and all that type of stuff. There's also too much. Like, there's also too much, and there's a certain amount of, like, hit the sweet spot. But, like, if the economics don't work out because over decades and decades and decades that we've just, like, built up these systems and processes and layers of cost, Like, there's only a finite amount of capital that can go around. And exactly what you said, if you, you know, if you want to stand a chance of getting something through the clinic, and you freaking hope that you're gonna get reimbursed for this thing on the other side, and you have to, like, raise a half $1,000,000,000. Like, shout out new limit. You guys got, like, a almost, like, a half billion dollars. But, like, how many companies can get a half $1,000,000,000? Like, not many. And, like, how many people are sick and how many different, like, sicknesses are there? A fuck ton. Like

Javier Tordable - 00:16:27: Yeah. And, I mean, in some spaces, you definitely can. Right? So I I believe, like, if you're working on oncology and an indication on which, you know, people are already spending billion dollars a year. Right? And you have good data, you can raise half $1,000,000,000. Right? Like, that is not a problem. Right? If you go and say, you know what? I'm working on lung cancer. Lung cancer costs, you know, tens of billions of dollars a year. I have a drug that cures lung cancer. I need half $1,000,000 for it. Here's all my data. Here's my proof. Maybe a phase one. Right? Yeah. You can get that funded. That's not a problem. But, of course, you know, people not only die from expensive diseases. Right? You know, people die of all sorts of other things. Right? So, you know, one of the examples that comes up all the time is antibiotics. Right? Nobody wants to pay $10,000 for an antibiotic. Right? You know, good luck with that. So because nobody wants to pay for it, we will keep dying of infectious diseases. And it doesn't have to be like an exotic, you know, oh, I just traveled to the middle of the Amazon Valley in the jungle, and I got infected by some disease that has never been seen before in a hospital. No. Like, I mean, this is literally 80 year old person, falls, breaks their hip, needing a hip replacement. Now you have to do a surgery. Well, now there's a risk of infection. Right? So, like, that person may die of hypervirus.

Jon Chee - 00:17:36: Yeah. Yeah. Or, like, like, just some sort of, like, level of, like, sepsis.

Javier Tordable - 00:17:39: Yeah. Yeah. Yeah. Sepsis for some bacterial infection. Right? That, you know, on a normal person, it may not have been a big thing. Right? But as a result of the fact that nobody wants to pay $10,000 for antibiotic, companies know that that will never be reimbursed, so they do not do research on that. So that is, I believe, all the scientific resources to create truly novel antibiotics, novel antivirals for a lot of, you know, verticillone diseases. And the only reason the only reason that it's not done is because there's no way to make money doing that. It is purely, almost purely, an economic problem.

Jon Chee - 00:18:14: Yeah. And I actually agree, like, wholeheartedly. And most of my colleagues who are still at the bench and doing research, I don't blame them for not seeing the problem as an economic problem because, like, they're living and breathing bench science. Right? And the biology problems are hard enough. Now you have to have, like, a PhD in, like, econ, like, to figure out, like, how to get this, like, novel science to market. Nobody's got time for that. I think I was listening to Marc Andreessen, and, you know, obviously, he's very at the bleeding edge. But, you know, there there's something hopeful in me or, like, something hopeful from all of everything that is going on right now where, you know, you talk about, like, how much information can you store in your brain. Right? There's this thing that can store the corpus of knowledge, and that is pretty awesome. Right? Maybe we can, like, do exactly, like, these really, really complex problems that, like, just no one person or no thousands of people can tackle. We can actually start making a crack at it. Like, you can be this, like, bench scientist who's, like, phenomenal at the biology, but you also have this in your pocket. Like, let's figure out the economics of this. Like, let me figure out like, I don't need to, like, bring in a million consultants.

Javier Tordable - 00:19:30: Yeah. I'm not sure it's an intellectual solution to I mean, there's this saying. I'll try to paraphrase a little bit, right, because it's about a slightly different thing. Right? But it goes like this. There are systems that you can vote your weight into, but you have to shoot your way out. If you have decades of decades of accumulating, you know, processes and decisions and incentives and and ways of doing things and people that would preserve those ways of doing things, there is no easy way out. And the way out is not a problem that can be solved rationally in a systematic way. Historically speaking, right, like, the way that decaying systems get replaced, it's not a, you know, happy kumbaya where people go and sing around and they decide, oh, let's try this different way. Right? So, I mean, again, I don't know what will happen. Right? In the context of health care, I have a suspicion that we have a few more years of raising prices. You know, things keep getting harder harder to do. People dying of stupid things that could be cured if, you know, only we, you know, we have figured that out.

Jon Chee - 00:20:28: Yeah. It's always kind of the same as there's gonna be more pain before it gets good, hopefully. You know? At least I have to tell myself that. I am the eternal optimist in that way.

Javier Tordable - 00:20:38: Well, there's this sort of saying, right, that I love, which is pessimists are often right, but optimists are often wealthy.

Jon Chee - 00:20:44: Yeah. Yeah. Yeah. Yeah. Yeah. That's true. That's that's probably true. Yeah. And this is, uh, maybe a good segue, like, you know, to start a company is an optimistic endeavor.

Outro - 00:20:56:

That's all for this episode of The Biotech Startups Podcast featuring Javier Tordable. Join us next time for part four, where Javier explains why he left Google after sixteen years to solo found calling AI and how he's built an agentic platform that collapses a six-month in silico drug discovery campaign into days. He'll also share what it's really like to build a company from scratch in the hardest field by yourself using the very AI tools you're selling to the world.

If you enjoy the show, subscribe, leave a review, or share it with a friend. Thanks for listening, and see you next time. The Biotech Startups Podcast is produced by Excedr. Don't want to miss an episode? Search for The Biotech Startups Podcast wherever you get your podcasts and click subscribe. Excedr provides research labs with equipment leases on founder-friendly terms to support paths to exceptional outcomes. To learn more, visit our website, www.excedr.com.

On behalf of the team here at Excedr, thanks for listening. The Biotech Startups Podcast provides general insights into the life science sector through the experiences of its guests. The use of information on this podcast or materials linked from the podcast is at the user's own risk. The views expressed by the participants are their own and are not the views of Excedr or sponsors. No reference to any product, service, or company in the podcast is an endorsement by Excedr or its guests.