Vertex Pharmaceuticals

Vertex Pharmaceuticals is an American Pharmaceutical company based in Boston, Massachusetts.

Vertex was founded in 1989 by Joshua Boger[2] and Kevin J. Kinsella.[3] Vertex was one of the first biotech firms to use an explicit strategy of rational drug design rather than combinatorial chemistry.

By 2004, its product pipeline focused on viral infections, inflammatory and autoimmune disorders, and cancer. It maintains headquarters in South Boston, Massachusetts, and two research facilities, in San Diego, California, and Oxford, England. The company’s beginnings were profiled by Barry Werth in the 1994 book The Billion-Dollar Molecule[3] and its further development in his 2014 book, The Antidote: Inside the World of New Pharma.[4] In 2009, the company had about 1,800 employees, including 1,200 in the Boston area.[2]

In January 2014, Vertex completed its move from Cambridge, Massachusetts to Boston, Massachusetts, and took residence in a new, $800 million complex. Located on the South Boston waterfront, it will mark the first time in the company’s history that all of the roughly 1,200 Vertex employees in the Greater Boston area will be working together.

Since late 2011, when Jeffrey M. Leiden joined Vertex as CEO, Vertex has ranked among the top 15 best performing companies on the Standard & Poor’s 500. Vertex shares increased 250 percent in the same period.[5] Vertex posted only one annual profit since it was founded in 1989.[5]

Vertex story

Vertex Pharmaceuticals (NASDAQ:VRTX) is a rare biotech success story. Started in 1989 by chemist Joshua Boger, the company was fueled for many years by three key ingredients: a unique approach to drug discovery, the tenacious dedication of a small group of scientists, and an ambitious long-term vision. It took decades for Vertex to translate its research and development efforts into FDA approved products. Investors who were early believers in the biotech’s mission and willing to take on risk, however, have been rewarded for their patience; shares are up more than 1,760% since the stock’s IPO in 1991.

But don’t for a minute think that Vertex’s trek to commercialization was easy, or that the company is no longer facing challenges.

Over more than two decades, Vertex has faced management shake-ups, suffered growing pains as it shifted its focus from drug discovery to sales and marketing, and has had to reinvent itself numerous times to stay relevant in this ever-changing industry. In 2011, for example, Vertex boasted the fastest drug launch in history after its hepatitis C therapeutic, Incivek, surpassed $1 billion in sales after its first year on the market. Those sales quickly eroded, however, after competitors emerged with more effective antiviral medications. Vertex was able to avoid disaster by quickly shifting its focus to its cystic fibrosis program, and shares have climbed almost 87% over the last twelve months as investors expect the company to expand its portfolio and develop more breakthrough therapies in the years to come.

To gain more insight into the history of Vertex Pharmaceuticals and learn what it truly takes to create a winning business in the fiercely competitive biotech industry, Fool.com’s health-care bureau chief Max Macaluso spoke with Barry Werth, an award-winning journalist who has followed Vertex almost from the day it opened its doors. Werth’s book The Billion-Dollar Molecule, widely regarded as a must-read for passionate biotech investors, offered an inside look at Vertex soon after it was established. Earlier this month, Werth released a sequel, The Antidote: Inside the World of New Pharma, which continues the Vertex story and chronicles the company’s path from a fledgling start-up to a company with a multibillion-dollar market cap.