Cephalon CEO Frank Baldino Jr. dies at 57

Frank Baldino Jr., the charismatic founder and chief executive officer of Cephalon Inc., the region's largest independent biotechnology company, died of leukemia Thursday evening at the Hospital of the University of Pennsylvania.

Baldino, 57, had been on medical leave since August, and the company he built from zero to $2.2 billion in revenues last year has been run by Chief Operating Officer J. Kevin Buchi.

It's often said that Dutch-born biochemist Hubert J.P. Schoemaker was the father of the local biotechnology industry. He founded the region's first biotech firm, Centocor Inc., in 1979.

But Frank Baldino was a close second.

"This is a guy who started in a cubicle in an incubator with a book of how to write a business plan, and took the company to a multi-billion dollar organization," said Bruce Peacock, who worked for Baldino from 1988 to 1996, when he left head Orthovita Inc. in Malvern.

"Across the nation, he's one of the very few guys who has done it from scratch to a commercial, large, successful company," said Peacock, now a venture partner in SV Life Sciences in Boston and chief business officer of Ophthotech Corp., a biotech start-up in Princeton.

"He helped dozens of other entrepreneurs get companies started. Frank was just a force," Peacock said. "He was a scientist by training, but developed an acumen in finance, sales and marketing as well. It's a sad day."

Brenda D. Gavin, managing partner of Quaker Bio Ventures in Philadelphia, said she's personally known "fewer than a handful of people" who took a company from the science, through private financing - venture funding - public financing, got products approved, and took a company to profitability.

"Believe me, they are so rare," she said. "Typically what happens, the guy who's the founder is not the same person who can go forward and take it all the way. Those people are really, really rare."

He was charismatic, bigger than life. "The great thing about him, after he had the personal success with his company, he was instrumental in getting the life-sciences greenhouses started and funded in Pennsylvania, particularly the local one. He's on the board there." Gavin said. "He was one of our advisers at Quaker. He really tried to give back to the community."

Although friends and colleagues knew he was ill, "everybody thought he'd be back. This is Frank!" Gavin said. "He's indomitable, and would beat this, and be back."

At age 33, Baldino started Cephalon in 1987, and he was still running the company 23 years later.

While a research biologist at DuPont Co., two venture capitalists approached Baldino to start a company to treat neurological diseases. He jumped at the chance, and took with him two other DuPont scientists.

Baldino built Cephalon from no products in the late 1990s, to eight sold now in the United States, and over 150 products in 80 countries. The company, whose net income was $342.6 million in 2009, employs about 4,000 globally.

Cephalon has grown by looking for drugs and businesses to buy, and in the last decade has acquired 16 products or companies.

Cephalon's first experimental drug, Myotrophin - for amyotrophic lateral sclerosis, or Lou Gehrig's disease - was rejected by the Food and Drug Administration. Even while working on Myotrophin in the early 1990s, Cephalon looked to diversify and licensed modafinil, sold under the brand name Provigil. It was that treatment for narcolepsy that became its first big seller.

Baldino, one of the longest-serving CEOs in biotech who has a doctorate in pharmacology from Temple University, runs one of the nation's few profitable biotechnology companies.

Pennsylvania Bio, a trade group for biotech and pharmaceutical companies, issued a statement saying, "Frank was a visionary leader who touched millions of lives here in Pennsylvania, across the country, and around the world."

"He truly exemplified the spirit of innovation and was one of the biggest supporters of Pennsylvania's bioscience industry," said president Christopher Molineaux. "He will be deeply missed by all within our community."

For the nine months ended Sept. 30, 2010, Cephalon revenues were $2.04 billion. Net income was $332.1 million, or $4.11 per share.

On Dec. 8, Cephalon agreed to acquire a 20 percent stake in an Australian company developing adult stem-cell therapies for cardiovascular and central nervous system conditions. It bought $220 million of Mesoblast Ltd. shares and paid an initial $130 million for its strategic partnership. Additional milestone payments of up to $1.7 billion were agreed upon.

That deal was struck while Baldino was on medical leave. Out of respect for Baldino, the company was not discussing a succession plan Friday.

Kevin Buchi, who has been handling Baldino's duties since August, has been with Cephalon 20 years.

"He's a very capable guy," Gavin said. "I'm not privy to their plans. It will be the board's decision. The company, in this interim, has been functioning very well. Frank wasn't that kind of guy, where it's all about Frank. Clearly, he had good management. The company will be fine, but still, it's a real blow."

Funeral plans were pending, said Fritz Bittenbender, Cephalon's vice president of public affairs.

Baldino is survived by his wife, Sandra, and two sons, Douglas, 6, and Harris, 1, and two grown sons, Jeff, 28, and James, 21, and a daughter, Leslie, 26, from a previous marriage.