BioPharma, Career Tips, Hiring Advice, Insights
The Critical Role of The CEO-CMO Relationship
The Critical Role of the CEO-CMO Relationship in Biotech
When the relationship between CEO, CMO, and other members of the C-Suite is on point, it’s like magic. Investors recognize these teams and back them from one endeavor to the next. In an industry where even the most amazing scientific discoveries never make it through the FDA’s rigorous approval process, this level of investor confidence is priceless.
Why is the CEO-CMO Relationship So Critical?
Many CEOs opine the relationship between CEO and CMO is the riskiest. How so? While many members of the C-Suite are therapeutic area/domain agnostic and can move from enterprise to enterprise with ease, the CMO must have credibility within the treatment community. I did have a few CEOs tell me they didn’t care about therapeutic expertise and they were bringing their tried-and-true CMO with them. Investors, corporates and strategics; however, scrutinize CMO hires based on the following criteria:
- Track record of clinical and regulatory success including efficient protocol design, management of data, management of consultants and meeting timelines.
- Relationships and successful meeting history with FDA Staff in appropriate review areas.
- Relationships/Reputation amongst PIs and KOLs, which normally comes from domain expertise.
These criteria can often necessitate introducing a new CMO into the C-Suite. When this happens, what does the CEO want to see in a CMO outside of the obvious elements of the position? In hindsight, what do they wish their CMOs knew or understood coming into the role or organization? What makes a good CMO in the eyes of the Chief Executive?
Insights for the CMO 360 Summit
In preparation for our CMO 360 Summit panel discussion, I interviewed 30 current and former CEOs (who are now board members) and asked these very questions. They worked with CMOs in early and late-stage organizations and under strict confidentiality shared their insights.
Let’s start with their positive observations and affirmations:
The Value of a Strong CMO
They universally agreed CMOs make an enormous and positive impact on the organization. Their focus on and genuine care for the well-being of the patient combined with their thirst for confirmatory data that treatments produce intended results is the foundation of why we are in this crazy business to begin with.
A successful CMO hire is worth their weight in gold. Literally. Competition for experienced CMOs is ferocious. Getting it wrong is expensive beyond the immediate replacement cost of the hire. It could result in losing other critical talent you’ve hired, failure to attract future talent, loss of investment dollars, clinical setbacks, additional trial costs and diminished investor trust.
Areas for Improvement
Now for the assessment of areas where CMOs should seek improvement. Their observations fell into 2 main categories:
#1 Leadership & EQ:
Check the Ego at the Door
“Play well in the C-Suite. You are part of a team and though important, no more so than any other member of the ELT” – though the comments were a bit blunter on this issue, failing to realize you are a part of a delicate functioning ecosystem that needs to work together and rely upon each other for success is a deadly corporate sin.
Several CEOs pointed to collaboration – or the lack thereof – as a critical issue. CMOs must work together with CSOs, CFOs, and Commercial leadership. That means listening, adapting, and being open to perspectives beyond those impacting the clinic. An elitist mindset or a dismissive attitude toward commercial, financial, or operating colleagues is a surefire way to undermine cross-functional cohesion. They may not be able to treat a patient or interpret biostatistical data, but they are experts in their fields and you are going nowhere (except perhaps the exit door) without their support. Ever tried conducting a costly clinical trial without the support, connections and understanding of the organization’s CFO?
This extends to the stakeholders within and outside the organization. Hire competent people who emulate the cultural aspects of the organization and then listen to their feedback and perspectives. This is particularly difficult for first time CMOs moving from a Clinical Development focus into full CMO responsibilities. You may very well be the most talented and knowledgeable clinical development professional in the organization, but your role is much broader and you can’t get buried in the weeds for this aspect of your position to the detriment of everything else.
Finally, you need KOLs and PIs. Someone other than you must agree that your asset will benefit patients and produce meaningful outcomes. Even if you know more, they are crucial to your success and their opinions and suggestions matter. Interact with them early, often and with dignity.
Learning to make difficult decisions faster is a critical leadership skill
The exact quote was “Kill it Faster”. That’s difficult for someone who has many years of data driven decision making expertise and is accustomed to considering every (or most) plausible alternative before acting. This applies to clinical trials and to direct reports. If an indication or dosage isn’t performing as well as others under consideration, recommend shelving and reprioritization. In a resource (fundraising) constrained environment you need a clipper ship not the MSC Irina. You must adapt faster. The same pertains to direct reports. They may have been hired for their expertise in a certain area, and you may value it and them greatly, but if they are causing chaos with others in the organization or failing to meet deadlines, deliverables or other items of critical import, a different strategy is necessary. That could mean replacing or reassigning them. Communication, oversight and faster corrective action are often at the core of these issues. We spoke earlier about CMOs becoming overly focused on the Clinical Development aspect of their responsibilities because it is often their comfort zone. Failing to recognize the signs and signals of issues in other parts of your organization may put you in a position where you are forced to make an uncomfortable and costly decision down the road.
#2 Enterprise Mindset
You are more than a Scientist/Physician – You’re a Business Leader
“You’re not at an academic center or physician practice anymore. You’re at a business.”
A recurring theme: Many CMOs still view the drug development process through an academic or research lens, focused primarily on scientific curiosity and altruistic possibilities Our industry is a capital-driven enterprise. CEOs emphasized the importance of understanding funding timelines, investor goals, and how trial design decisions impact both runway and ROI. Unrealistically fast trials can lead to failure, but overly padded timelines can stall investment. Striking the balance requires business acumen, not just clinical insight and regulatory rigor. That balance is difficult since scientific curiosity and rigor around statistical differentiation make or break a product. Drug development needs to mean something to someone beyond the statistical measures and documentation of the observed result. It’s all about value and the timeline to produce data and demonstrate potential value is compressed in today’s economic environment.
Speak the Language of Investors and the Market
“Tell the story – don’t just cite the data.”
Data alone doesn’t move capital. The ability to communicate science in compelling, relatable terms is key. CEOs want CMOs who can confidently explain complex mechanisms to investors and board members without defaulting to jargon. Frame the value in terms of patient benefit and commercial potential – not just statistical significance. The audience needs to understand why it’s relevant. Be comfortable talking about what could be rather than what you have proven retrospectively. A prime example would be interpreting results in animal models and what that “could” mean in the human setting. Of course, you need to be compliant within the regulatory framework but the regulators are not your only audience.
Mind the Money
“Cash burn is real. Academia and clinical development silos don’t prepare you for it.”
Especially in early-stage companies, CMOs must be mindful of budgets and resource constraints. Many come from academia or big pharma or even a Clinical Development silo, where funding flows differently or the constraints are not as transparent. In small companies, every decision is a tradeoff. CEOs want CMOs who understand when to outsource, how to use CROs cost-effectively and when to pivot based on financial realities – not just ideal study design. Know when an indication is in trouble and tell us (we discussed “Kill it” earlier in this article).
Integrate with Commercial from Day One
“Clinical and Commercial can’t live in separate worlds.”
Multiple CEOs warned against the “veil of compliance” that keeps clinical and commercial teams from working together more effectively. CMOs must align clinical endpoints with what matters to payers, patients, and physicians – not just regulators. That means understanding how the data will be interpreted in real-world settings, ensuring endpoints are approvable, meaningful to patients and sellable. Sorry, but the science will not sell itself. Incorporating patient related outcomes and setting the stage for Health and Economic Outcomes data capture is crucial. Even if one of the organization’s strategic alternatives is to sell or royalty assets in development, a positive commercial lens drives value recognition with investors, M&A participants and potential strategic partners. Cool science captures attention, but cool science combined with meaningful outcomes and clear earnings potential allows the organization to build more value and invest in more cool science! The earlier an organization can demonstrate value, the better in any end-game situation.
CEOs also discussed the tug and pull between funding further R&D and funding Commercialization as products approach and receive approval. If an organization is going to invest in both, it will not always be an equal allocation. The support of the CMO during cycles where Commercial investment may outweigh R&D investment makes for a healthy long-term business entity. One can’t exist without the other and it is a natural conflict a CEO needs to navigate unless the goal is out-licensing or selling the asset. Be a supportive CMO during this time. Don’t allow Commercial to be viewed as the dark side. They are revenue drivers to fund future investment in the discovery and development engine of the organization. It puts you in a better position because it decreases reliance on certain investor resources that would exercise influence over asset prioritization. It gives you and your leadership team more control over the organization’s future.
Think Like a CEO
“If you want to be a CEO someday, start acting like one now.”
For CMOs eyeing a future in the top leadership role, the pathway begins with broadening their skill set today. That means developing fluency in operations, finance, people management, and investor strategy. Can we say step outside of your Clinical Development comfort zone often enough? Understanding the full picture – and leading beyond it – is what distinguishes potential CEOs from perpetual specialists. This applies to any other members of the C-Suite as well.
Final Thoughts: The CMO of Tomorrow and Ensuring CMO Success
Today’s most effective CMOs are more than just clinical stewards – they are translators, strategists, and business builders. They connect the dots between data and value, between innovation and patient impact. They don’t just lead trials; they help lead companies.
In a market where every hire must be high-impact and every decision capital-conscious, CMOs who embrace this broader mandate will not only drive better outcomes – they’ll shape the future of biotech leadership.
So how do you avoid the pitfalls of a failed CMO hire? Most CEOs agreed this role is too important to leave to chance or the limitations of their own personal networks. Even careful and judicious hiring processes utilizing an experienced Search Partner to identify what appeared to be an excellent cultural match could fail to yield the cohesive relationship desired. One major theme emerged in this regard: Making additional investments to support the CMO once they start with the organization. When you are forced to introduce a new or first time CMO into an organization, you should consider supporting them with coaching and mentorship to successfully make the transition to a new team or from Clinical Leadership to Executive Leadership. It is worth the investment to avoid potential pitfalls.