From the Final Hours of Mass Effect app:
On Page 8 of 10.
By the spring of 2007 it was clear that parts of Mass Effect's original vision, hugely ambitious from the start, would never be realized. The entire online Xbox Live trading system was scotched, and Walters' idea of a plot about a shadowy organization named Cerberus, which conducted human experiments on a planet named Misery, was designed but never made it into the game. Similarly, a volcanic mining planet named Caleston was planned as a level but cut due to production delays. (Some of those story elements folded into the player's adventures on the planet Therum.) More than anything else the game's combat system continued to be refined as the team balanced the desire for a mainstream action-oriented experience with the company's roots in a deep role-playing game with skills, stats, and progression.
Human experimentation on a planet named Misery? And that's the guy they put in charge.
Later on Page 8 of 12, there is a part about the development of ME2 and Mac Walters stepping into the Lead Writer role.
Back at the office, Hudson spent time thinking about Mass Effect 2. He put together a huge spreadsheet that analyzed all the positive and negative feedback about the game from 97 different reviews. And in a black notebook labeled "SFX," he began charting out ideas for the sequel. If Mass Effect was the wake-up call about the pending Reaper invasion and the third game was to become an all-out war against them, he, Karpyshyn and Mac Walters needed a good second act to the story. (Karpyshyn left the team shortly after Mass Effect 2 began production to focus on the development of BioWare's latest release, the massively multiplayer game Star Wars: The Old Republic.)
Walters and Hudson centered in on a dirty dozen story in which Shepard would spend the second act of the game canvassing the galaxy to recruit what he called "commandos" in his notes. This diverse group of characters - including familiar faces from the first game - would team up with Shepard to fight a mysterious force known as the Collectors. Somehow tied to the Reapers, these aliens were wiping out human colonies around the galaxy. The second game would culminate in a massive battle, a so-called suicide mission in which many of the characters could perish - including the player's Commander Shepard.
The sequel also gave Walters a chance to bring back his idea for the shadowy organization of Cerberus, only briefly hinted at in the original game. Hudson ran with this idea and suggested that the organization be run by a character he imagined would look like Anderson Cooper from CNN and act like Jack Baur's brother Graem from 24, a rogue charlatan who had enough power to tell the president of the United States what to do. The character would be known as the Illusive Man, a self-appointed protector of humanity who would do whatever is necessary - even outside the political system - to ensure the race survives and controls the Reapers. Martin Sheen was selected as the voice of the character.
Other changes were on the table for the sequel. For a while, the team wanted Shepard's ship, the Normandy, to be destroyed at the start of the game as part of his untimely demise. (The Illusive Man would bring Shepard back to life and help him assemble a new ship, named the Leviathan, in the first act of the story.) Watts and the art team pushed back because they loved the Normandy design and the interiors, inspired by the George Clooney movie Solaris. Eventually the design team relented; the ship was blown up at the beginning, but it was replaced by the nearly identical Normandy SR-2.
We can see here the same impeccable planning that is evident throughout the rest of the trilogy.