Genentech: The Beginnings of Biotech (review)

On October 14, 1980, a new stock symbol, GENE, appeared on the NASDAQ ticker, marking the initial public offering of a small San Francisco start-up, Genentech. “A minute after the opening bell, the share price skyrocketed from $35 to $80—the fastest first-day gain in Wall Street history” (p. 158). Before that day, Genentech was an oddity: a small, young, California company that wanted to compete in an industry—pharmaceuticals—overwhelmingly dominated by large, old companies on the East Coast and in Europe; a science-based firm with ties to an academic discipline—molecular biology—with traditionally very low levels of entrepreneurship; a life sciences firm funded and managed largely by people with backgrounds in the microelectronics industry; a firm existentially dependent on its intellectual property portfolio whose IP lawyer was best known for his representation of Miss Nude American. Yet after October 14, 1980, Genentech became the new normal for the Reagan era that began three weeks later. Suddenly, questions about the dangers of recombinant DNA and the propriety of university patent offices and professorial start-up companies melted away.

The ensuing biotech boom and the successive attempts to replicate that boom in new regions (such as San Diego) and new high-tech industries (such as Internet commerce, nanotechnology, and clean tech) have cemented the mythic status of Genentech and its key players, especially its cofounders, Herbert Boyer and Robert Swanson. Much industry gossip and a few scholarly works (primarily from a management studies perspective), such as Martin Kenney’s Biotechnology: The University–Industrial Complex or Maureen McKelvey’s Evolutionary Innovation: The Business of Biotechnology, have gestured to the winning elements of Genentech’s corporate culture.¹ Yet until now, historians of science and biomedicine have been mostly content to nibble at the edges of the Genentech story.

Sally Smith Hughes’s Genentech: The Beginnings of Biotech wonderfully bridges that gap. I say “bridges” rather than “fills” because Smith Hughes has written an eminently readable (and, for classes, eminently assignable) story focusing on the eight years of science and business leading up to that record-breaking IPO, as told from the insiders’ perspective, rather than a drily comprehensive history of Genentech’s first thirty years. Smith Hughes is one of the foremost oral historians of science today, and Genentech is filled with illuminating interview snippets woven artfully into a narrative that both engages and (somewhat surreptitiously) analyzes. Genentech, however, is unapologetically an interview-based history of, well, Genentech. To be sure, material from interviews with company outsiders and critics is included, as is plenty of documentary evidence, much of it still privately held and only brought into historical view by Smith Hughes’s interviewing. Moreover, Smith Hughes doesn’t hesitate to show the company embroiled in controversy or its employees behaving badly. But the framing—and occasionally the spin—of the storytelling is that of the early participants in the firm. Admirably, though, Smith Hughes doesn’t hide the positioning and partiality of her interviewees, and she makes it easy for savvy readers to consult alternative views.

Still, Genentech, like many histories of high-tech entrepreneurs, is prone to certain inconsistencies in describing what exactly entrepreneurs do (very similar in this respect, and equally fascinating, is Leslie Berlin’s The Man Behind the Microchip).² So, for instance, on page 133 we learn that Genentech “had no tolerance for slackers,” but later on the same page we’re told that visitors “sometimes had to avoid clusters of scientists bowling for dollars in hallways or playing foosball while waiting for experiments to run their course.” Or, on page 128 we’re told that “sharply delineated functions had no place at Genentech,” but on 131 that “Swanson remained of a general mind that business was for businesspeople and scientists should stick to science.”

These apparent inconsistencies are a mere quibble, but perhaps an instructive one. Consistent description of high-tech entrepreneurship is elusive because there can be no consistent rules...