Road Map for Reduced Risk Biotech Start-Ups
Dubai Bio Expo - 2015November 2, 2015
Louis Herlands, Executive Director Sidra VenturesSidra Medical and Research Center, Qatar
Sidra Medical and Research Center
Engaged in cutting edge research in tumor immunology, genomics, systems
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Sidra Ventures is the commercialization &
innovation arm of Sidra Research
Helping catalyze creation of biotech industry
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OUTLINE: Road Map for Reduced Risk Biotech Start-ups
Rationale: why is this topic important?
Key questions
Examples of successful companies, and what we can learn from
them? What can we learn from failures?
Elements of a successful biotech companies
Proposed road map
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Biotech Start-up Basics
TECHNOLOGY LICENSING
RECRUIT TEAM
First POP Trialin Humans
EXIT
$$$
Simplified Model
I. Rationale
In the GCC, the biotech and pharmaceutical industry is poised to play an
important role in the diversification of the economy and start-ups or early
stage companies can play an important role.
Failure rate for biotech start-ups is high ( >90%)
What are strategies for reducing risk and increasing the likelihood of success?
II: Key Questions
What are certain successful biotech companies doing right?
How can we learn from them?
How is risk reduced by these successful companies?
Can we do the same?
As investors, fund managers, or CEOs how can we pick the
successful companies at the earliest stages?
Principia & Biorexis: Reduced Risk product candidates - Improved versions of biologics through fusion proteins
• Albumin fusion proteins increase plasma half life and allow sustained exposure therapeutic
• Second generation biologic• Examples:
• Albumin fusion proteins (Principia)• Transferrin fusion proteins
(Biorexis)
Albinterferon -2b: a genetic fusion protein for the treatment of chronic hepatitis CG Mani Subramanian, Michele Fiscella, Araba Lamousé-Smith, Stefan Zeuzem & John G McHutchisonNature Biotechnology 25, 1411 - 1419 (2007)
Principia Pharmaceuticals: What did they do right?
• Driven industry-savvy senior leadership team
• Strong scientific team with industry experience that are agile and focused on IP
• True platfrom technology: Reduced risk product candidates that meets large unmet medical needs
• Strong IP portfolio
• Judicious use of $ invested to reach significant value creation milestones: (i) generated high quality compelling non-clinical data package
• Operational excellence: high quality work & aggressively meet deadlines on time & budget
• Leadership compelling enough to convince investors and strategic partners
• VC investment syndicate dialed in exit (but, limited upside for co-founders.
Acquired by Human Genome Sciences ~12 months after formation for $120 million
Oraltech Pharmaceuticals: What did they do right?How did they blunder?
Oraltech’s lead product candidate was a Pan-Cox oral rinse
• STRONG MANAGEMENT, LUMINARY SAB MEMBEMBERS & DIRECTORS
• Strong Scientifically
• Treatment of Intraepithelial Neoplasia – not chemoprevention
• Reduced risk product candidates that meets large unmet medical needs that represent large markets
• Clinical stage product candidate
• Strong IP portfolio, new use for old drug
• Oral health & ‘chemoprevention’ not an attractive area for investors & pharm
• DID NOT RAISE ENOUGH MONEY FOR CONTINGENCIES
• Weak clin/reg strategy – difficult indication, heterogeneous patient population• INVALID NCI clinical trial
COULD HAVE BEEN A SUCCESSBUT: INABILITY TO RAISE CAPITAL TO REPEAT TRIAL
Reduced Risk product candidates II: Local Delivery
1. Nasal Delivery to deliver medicines to the brain
• Gets the medicine to where it is needed
• Minimizes systemic exposure
• Avoids fist pass metabolism
• Bypasses blood brain barrier
2. Oral rinses to deliver to mouth & gums• 20-50X higher concentration in gingival
crevicular fluid (GCF) than peak plasma• Minimizes systemic exposure• Gets the medicine to where it is needed
Platform Technology
Science 28 November 2014: Vol. 346 no. 6213 1258096
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Proposed framework towards a reduced risk biotech
INTELLECTUAL PROPERTY
2: PRODUCT CANDIDATES
3. FINANCING 1: LEADERSHIP TEAM
ROADMAP: 1. LEADERSHIP TEAM
“We bet on the jockey, not the
horse”
Driven obsessive leadership
Track record of success
Suboptimal to learn on the job
Diverse skill set required
2: PRODUCT CANDIDATES: Criteria
Strong Intellectual Property
Meets unmet patient need in large market
Platform Technology or Product Portfolio
Well trodden clin/reg path
Reduced Risk Strategies
Most product candidates fail for reasons of safety
New indications for old molecules
Improved versions of existing products
Local delivery
3: FINANCING STRATEGIES
Investments from strategic partners
Non-dilutive capital
Avoid VCs, if possible
Be realistic about valuations
Don’t worry about dilution
Investors who will participate in future financing rounds
Gain early access to public markets, if possible
Gap Fund
‘Proof of Principle’ studies required to demonstrate commercial potential are rarely conducted
by academic institutions, due to the lack of expertise and established funding mechanisms for
this purpose. This often results in a development gap between early-stage academic invention
and the validation required to attract the participation of the private sector.
Gap Funds are increasingly becoming implemented and there are numerous examples:
Rockefeller University Robertson Fund
Boston Children’s Hospital Technology Development Fund
Partner’s Innovation Fund
http://innovation.partners.org/investors_and_entrepreneurs/partners_innovation_fund
The vision of Sidra Technology Ventures is to help bridge this gap by providing funding to generate more data including non-clinical and ‘proof of principle’ studies that adequately demonstrate the invention’s promise and potential and support patent application filing.
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Summary Slide
PRODUCT CANDIDATES
• Driven, obsessive leadership
• Track record of success• “We bet the jockey, not
the horse”
• Strong IP Portfolio
• Preferably composition of matter patents
• Investment from strategic partners
• Avoid VCs if possible
• Non-dilutive capital
• Be realistic about valuations
• Don’t worry about dilution
• Investors who will participate in future rounds
• Gain early access to public markets, if possible
Maximizes likelihood of having a successful company
LEADERSHIP
• Meets unmet need in large markets
• Platform technology or Portfolio of product candidates
• Reduced risk strategies
• Well-trodden clin/reg path
INTELLECTUALPROPERTY FINANCING
Take Home Messages
• In-licensing value high technologies is a viable approach to jumpstarting start-ups
• What was presented today are ideas for consideration that will need to be modified or adjusted to specific conuntries in the MENA region to reflect available resources
If you have any questions Please contact me:
Louis Herlands, PhD Executive Director Sidra Technology [email protected]
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