On the very first Mantell Associates Network podcast earlier this year, CEO Alessandro Mantell spoke with Dietrich Bruchmann, CEO of Nuvisan Pharma Services.
Having spent the first part of his career at Hoescht AG, Dietrich spent just under 9 years at DuPont before delving into the world of M&A at ADCURAM AG. Dietrich Bruchmann joined Nuvisan Pharma Services as CEO in 2010. Nuvisan is a full integrated European CRO / CDMO providing all relevant GxP services, with more than 40 years of experience in projects for BigPharma, BioTech, Academic Institutions and CROs.
Alessandro Mantell: Thank you so much for joining me on the Mantell Associates Network, Dietrich. In terms of Nuvisan as a whole, I’m interested to find out a little bit more about you and about the business. So, how did you come into Nuvisan – what’s your background and how did it all start?
Dietrich Bruchmann: Well in a nutshell, it’s a classic career path. You study chemistry, you join one of the big German companies, you go to the US, you become a General Manager and work your way up, and either become a Board Member or you get fired! So, I was unfortunately fired but I got a good severance payment, and at the end of the day you reorient yourself swiftly into something else. I reoriented into Private Equity for a couple of years, and then I came across the opportunity at Nuvisan as they were undergoing financial crisis, and I was asked to run that show in 2010. We started 10 years ago with something like €12-15 million in revenue, and including the integration of Bayer’s activities in Berlin we had around 850 people with roughly €120 million in revenue, which was a combination of organic goals and mergers and acquisitions.
Now, 10 years later, we have acquired a small business in pharmaceutical analysis near Dortmund, and we acquired the DMPK side of Merck which gave us the opportunity to extend our value chain into Preclinical. The key issue is that, with the agreement, not only do we get business with Merck in Preclinical but also in other core areas of Nuvisan which was fairly important for us.
So, that is always the same story – you have to change it over a period of 3-4 years and do something which is independent of the former owners, because the former owners might change their strategy. We want to have the quality assets and especially the quality people. And whenever we don’t find enough quality people, we go to Mantell Associates because all of these businesses come without business development. Business development is of course a very important function, and that’s your strength Alessandro. I can say that you have been instrumental in helping us to develop this function, which did not exist in the business. And in Berlin, we will hire something like between 40 and 80 people. These people came as purely operational people, so that’s missing administration, sales, quality control, finance and all these functions that you need to effectively run a show. We tried to do enough from Neu-Ulm, but Neu-Ulm is at it’s limit. People, and this is why I need help from you Alessandro, are our biggest resource.
To be clear, when I started in industry, people did not treat employees well. Today, it’s a totally different story and the objectives of the people are not necessarily a career but a work balance and a good employer. So for us, we want to have employees who are happy to work for Nuvisan, stay for a long period of time with Nuvisan, develop their career with Nuvisan, and have a balanced work-life. That’s basically what we as a company envision.
Alessandro Mantell: Perfect. Something which I wanted to ask you as well because working in the job that I do, I see so often companies acquire other businesses. And from our side as headhunters, from the point of takeover we’ll immediately see applications from people within that business looking to leave. Now, from the sites that you’ve acquired we haven’t had these types of applications. How do you manage to integrate a business so successfully?
Dietrich Bruchmann: Well it’s simple really, I did not hire any people in sales! So, if you have a merger of companies in the same market space, there is an overlap which means redundancies. And I can envision the frustration of people being made redundant because of a merger, which is mainly driven by synergies in operations. And we are not having synergies in operations – we are extending our value chain. We see no need to make people redundant because I am a strong believer in growing a business instead of downsizing a business. I was cutting costs and downsizing businesses in the 90s up to 2007 – but at the end of the day you don’t win with cost-cutting. You lose. Because you get so many frustrated people and you make so many negative vibes. Luckily, in our business we have organic growth of 15-20%, so you don’t need to downsize. You just need to find the right people.
That’s a much more important thing. To find the right people, at the right time, think it through and have a vision and goal for your organisation. And let people develop, don’t make people feel as though they are not needed – they are all needed.
Alessandro Mantell: Understood. Going back a little bit, you said you took over Nuvisan when it was at a point of financial crisis. What made you take that risk – what did you see?
Dietrich Bruchmann: Well, whenever you see an opportunity you put together a business case and you calculate it backwards and forwards. And it was this kind of financial crisis that occurred in Germany at the end of 2009 – everything was in crisis mode. So, it could not go further down and at that time, the government in Germany subsidised taking over companies by sending people home temporarily and they took 100% of the cost. So it was the government in Germany that helped us to get out of the crisis earlier than other countries, and that was a main motivation why Germany excelled – especially in the automotive industry – and companies did not have to lay off anyone.
Alessandro Mantell: What’s the purpose of the business as a whole? What is Nuvisan’s aim for now and the future?
Dietrich Bruchmann: The aim is to be a service provider to Big Pharma – mainly Big Pharma in Biotech. And we know that the pharma industry will continue to grow, which means this business is growing automatically.
As well as this, since Nuvisan is a family business I have the intention to transfer that within the next 5 to 10 years to members of the family – we don’t sell.
Alessandro Mantell: On my side, I spend my days speaking with executives inside organisations and watching people who are leading companies of 10 people, 100 people, 500 people, from small Biotechs to large Pharmaceutical organisations. How much has your position changed since having to lead Nuvisan, how do you adapt to leading that amount of people, and what is your strategy?
Dietrich Bruchmann: Well, it’s very simple. At the beginning you’re more of a micromanager looking at everything and seeing if things are being done right or wrong. And today, I don’t go into as much detail for every person and I’m just giving directions – but I still know everybody.
The direction I’m giving now is to grow the business and develop the chain all the way from the molecule to the patient – all under one roof. Very straightforward – try to sell and turn key projects.
Alessandro Mantell: Of all the areas that Nuvisan covers, you have competitors in each of those areas but I don’t know of any other businesses that do every single part, unless on a much bigger scale. How do you fundamentally operate as a business?
Dietrich Bruchmann: We are in a smaller league – a family-owned business that is grown in the DACH region, so Germany, Austria and Switzerland. The United Kingdom is not really a market for us unfortunately due to Brexit, but we have markets across Scandinavia, Asia, the DACH region, as well as Spain, Portugal and Italy, but we will of course have to see how the coronavirus affects these markets and develop a contingency plan.
Alessandro Mantell: In terms of leadership style – you said that beforehand you were more of a micromanager, now you give direction. How do you run Nuvisan and change your leadership as the business grows? You have 850 people, how do you navigate this?
Dietrich Bruchmann: We have an executive committee of 12 people, and these 12 people are all distinguished leaders and they can run the business in their segment better than me. I have experts who have come in from Big Pharma’s and they know everything better, they love to do it – give the power to the second and third layer of people.
Alessandro Mantell: You mentioned earlier about keeping people as opposed to making people redundant. How do Nuvisan as a business go about keeping staff in today’s market?
Dietrich Bruchmann: First of all you have to have a good working environment. Secondly, give some incentives and extra benefits around family life that people need to have to grow their families. If you think about all these things, you will have a good team and the spirit of the team is very important. If you have a bad atmosphere within the company, forget it. But if the atmosphere is overall a positive one and consistent, people stay.
Our turnover is very low, and all we need is more and more young talent. So, what we are doing, we are taking young talent straight from university and hiring and developing them. Some will use Nuvisan as a springboard to develop their career and move to Big Pharma companies, but if they love it at Nuvisan they will stay long-term.
We have also had a lot of people join us from larger pharmaceutical organisations – it’s a two way street. People join us and if they have career ambitions, they develop and very often stay. And those who leave will often come back after a couple of years.
Alessandro Mantell: So what does your life look like outside of work? Have you always handled that work-life balance well?
Dietrich Bruchmann: I go skiing every weekend at the mountains only 2 hours from me. There are, of course, times when you are more stressed and working longer hours. At one time, I was basically living out of my garage when I was first starting out – but that’s just entrepreneurship. Setting up a startup company is not always wonderful, it’s a lot of hard work.
Alessandro Mantell: From a psychology point of view, what do you think it takes for somebody to be able to come into a place like Nuvisan where you’re leading the company (and often the people in the business are going to outearn you) and handle everything?
Dietrich Bruchmann: Well, you know, money isn’t everything. The thing is, it’s a dream and you have to go for it.
Alessandro Mantell: To any aspiring people who are watching – whether it be people who are starting biotechs, pharmaceuticals, CROs or people like me who have set up their own companies or trying something new, what’s your advice for people like that?
Dietrich Bruchmann: Try to believe in yourself and don’t work with too many advisors. They just want your money! It’s just the way it is, but you can often come to the same conclusions yourself.
Alessandro Mantell: I just want to touch base again on the new acquisition. You’ve been incredibly busy over the past five years, and without a doubt the Bayer site is your biggest ever acquisition – how have your businesses partnered together?
Dietrich Bruchmann: Yes that’s true, but the point is that it’s an integrated business. Which means it’s not only DMPK, it’s DMPK plus pharmacology plus toxicology plus chemistry plus plus plus. So it’s all the early clinical research of Bayer which has been bundled into one entity. And Bayer has looked for a partner – Nuvisan was the partner of choice because we have the same vision and work along an aligned value chain, meaning we can develop together according to the values of Bayer. So, that makes life easier for both parties. You cannot really call it simply an acquisition, it’s more of a cooperation between Bayer and Nuvisan.
Alessandro Mantell: In terms of that part of the business, will this have global reach?
Dietrich: Nuvisan is 50% DACH region and the rest is global. But ultimately, companies need our services and we will be going out to different global markets, in the closer regions first then reaching out further to the US markets.
Alessandro Mantell: Thank you so much for your insights Dietrich!
If you missed Dietrich’s original podcast and would like to listen, please click here!