August 22, 2017

Counseling big pharma with a focus on building a good corporate reputation

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Lelovac

Zarko Lelovac is counsel to the CEO at Hemofarm AD in Serbia

Zarko Lelovac has worked for several large law firms and in many European countries during his career. Recognizing the need for greater managerial skills, lelovac enrolled in an MBA program. Later, a secondment for Wolf Theiss to help restructure Hemofarm led to Lelovac being invited to join the company as an advisor to the CEO.

Thank you for giving us this opportunity for an interview. Can you tell us a bit about your professional background?

For the last seven years I’ve been working as a Serbian-qualified lawyer for several international law companies, with the particular focus on the areas of foreign investments, banking and project finance, as well as M&A transactions. I should mention that besides my engagement in Serbia, I’ve had the opportunity to work with international legal teams in Austria, Croatia, Hungary, Slovakia and the UK, where I participated in several cross-border transactions and M&A deals. Such opportunities provided me with a broad base of experience and knowledge, which help me to continuously improve my legal practice and also enable me to advise both international and local clients at the highest levels.

In practice, I’ve dealt with situations where a high level of understanding and knowledge of managerial skills are required, therefore I recognized the importance of these issues and seized an opportunity to enroll into a qualified Executive MBA program at Cotrugli Business School. I can truly say that this valuable experience helps me immensely in my current role as Counsel of CEO of Hemofarm AD, a leading regional pharmaceutical company and part of the German based STADA Group.

You made the shift recently from private practice to in-house counsel when you joined Hemofarm. Can you please tell us a bit about what influenced your decision to make this transition?

Looking back I would say that this was a natural step in my career. An experienced corporate lawyer, I was approached by the leading regional law firm Wolf Theiss to accept a secondment at Hemofarm in order to assist the top management in the process of restructuring Hemofarm. It was my first secondment of that kind, and at that time it might not have looked like an easy decision, but I accepted this challenge. For the first six months I worked as adviser to Dr. Ronald Seeliger who was, at that time, the chief restructuring officer. The experience of our collaboration was excellent and when Dr. Seeliger took over the position of CEO in July 2012, he invited me to join his team and take a role of his legal counsel.

In my legal practice, I was always focused on the corporate aspects of law and the opportunity to become an integral part of a corporation that operates on a global level and to have the opportunity to actively design and influence the legal framework in which such a company operates was my main reason for accepting the challenge and making the transition. Now, after a year in this new position, I am absolutely convinced that it was the right move.

Your title reads “Counsel to the CEO” – what does your role entail exactly and is it in any way different from that of a Head of Legal/General Counsel?

Although my primary professional calling is linked to corporate legal affairs, my current role requires a multidisciplinary approach as well as sound knowledge and expertise in the area of strategic management, finance, operations management, HR, and public affairs. While the head of legal position is responsible for the legal part and resolves the traditional inter-company conflict between legal and marketing departments, the counsel to the CEO requires more of a “global perspective” and a deep understanding of how a particular decision would influence the company on both an internal and group level as well as what could be the strategic implications of implementing such a decision. I would say that it is a very challenging position because it requires a broad range of expertise, knowledge, and skills, which are necessary to advise the CEO in his overall responsibility to manage a leading company that employs 1,700 people.

What were your first few months like? Looking back, what would you recommend as crucial first steps when in a new company?

Taking on a new role in a company, which is new to you simply is not easy. Stepping into a dynamic environment of such a company, in terms of its processes and operations, requires you to be absolutely on top of all ongoing matters at all times. You have to not only familiarize yourself with the processes, but with the people as well. I truly believe that hard work, a proactive approach in dealing with crucial matters, and good people management skills are the key steps to building a good corporate reputation. Strong focus on results and goals which bring about value and benefits to the company would be my recommendation for excellence in performance.

Did you build a new team yourself to support your role? If so, what were the key characteristics of the lawyers you brought on-board your team? Having now had a chance to settle in, what do you find as the most challenging aspects of your role and how did you overcome them?

I would rather say that I was building my role as a helpful part of the existing teams within the company than say that I built my own team. Furthermore, my role is closely linked to the top management and their teams, therefore I am trying to develop and ascertain my professional authority based on my knowledge and expertise and accept full responsibility when taking a lead on matters in which I am involved.

Instead of providing advice like “no, this is not possible,” I am trying to develop a solution of “how to do it” without disclaimers that are so many times abused by lawyers. The role of corporate lawyers should not only be to advise what is legally acceptable and what is not allowed, but to also to understand the business ideas and place them within a legal framework so that the management can transfer these business ideas into business decisions. It is not an easy task, but with a creative approach and true commitment it is an achievable challenge.

Why did you choose to work for a pharmaceutical company? What got you excited about this field?

Lelovac says Hemofarm's products are saving lives.

Lelovac says Hemofarm’s products are saving lives.

As I mentioned, I was interested in international corporations and how they operate (internally and externally) and as a blissful consequence I’ve had the opportunity to learn a lot about the pharmaceutical industry and its impact on the health of everyday people. The crucial difference from other industries lies in the fact that our products are saving lives on a daily basis, and that is something that you just cannot simply ignore. From my experience in the pharmaceutical industry, I realize now that I will probably not go back to the banking and finance industry where I was involved during my previous roles.

Since this is a new field for you, what was your secret in bringing yourself up to speed in terms of all the regulatory/compliance issues you needed to be aware of?

It is true the pharmaceutical sector was a new field for me, and I was forced to spend a lot of my free time acquiring new knowledge in this field. With proper motivation, commitments to professional goals, and proper time management, everything is achievable. There is no secret and every professional can do it. The question is, are you professional enough to do it?

From a regulatory standpoint, what do you find keeping you up at nights in your new role?

It is definitely the unpredictability of the actions and decisions made by the governmental authorities, which directly affect business and disable any long term business planning.

Our volatile legal framework is incomplete and non-aligned with EU legislation in many important aspects. As a consequence, it is creating high levels of uncertainty in the healthcare sector and allows for non-transparent procedures to be implemented on several levels, including the decisions of government authorities.

The pharmaceutical industry is only occasionally and declaratively involved in the narrowed scope of the decision making processes, without any opportunity to make a real contribution and enable the transfer of know-how from other more developed markets. As a result, regulations are often unsustainable and non-implementable. In the meantime, patient associations are being marginalized without any influence on the quality of our healthcare system as well as the decisions of which drugs are going to be reimbursed by the state.

Patent protection is crucial in this industry and many GCs that we speak to from this sector praise the EUs efforts at centralizing IP efforts. What is the situation like in Serbia and to what extent does that influence your role?

Serbia recently received a green light to initiate the negotiation process for joining the EU. This process will require a harmonization with EU regulations, and I believe Serbia will soon successfully complete this process. Regarding the IP centralization, I also support EU’s effort, as long as such efforts will generate real practical effects rather than just more EU bureaucracy.

From local point of view I have to say that the Serbian IP registration/protection system (when it comes to regulations) is very well developed, but there is still space for improvement on implementation of such regulations, which is the issue with the Serbian judicial system in general. We all hope for the best, but unfortunately current developments within the EU make me skeptical, since many excellent ideas are just kept as an item on the EU’s agenda.

Finally, what advice would you give to a young lawyer who wishes to follow a similar path and work with pharmaceutical companies?

I’ve talked about hard work. But having an open mind, accepting challenges and thinking about yourself in terms of the future are the only things that will make this work bear fruit.

 

The Lelovac File

 Company: Hemofarm AD

Country: Serbia

Industry: Pharma

Title: Counsel to the CEO

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