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Through GSK partnership, NEOMED continues to redefine drug development
By Shawn Lawrence
Through GSK partnership,
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NEOMED continues to redefine drug development
Paul Lirette still remembers the day he got word from GlaxoSmithKline’s head office that the company was pulling the plug on its R&D center in Laval, Québec. As more and more pharma companies globally look to externalize their R&D efforts, the closure of such facilities have become more common. While saddened by the news, he also felt a need to act.
“I was determined as a GSK shareholder, employee and Québecois that we had to do all that we could to protect the excellent science in Québec, the high level of innovation, and the expertise we had built with our employees,” he recalls. As the president of GSK Canada Pharmaceuticals, Lirette knew that such a facility could be put to good use by the right people.
At the top of this list was Max Fehlmann. It had only been two and half years since Fehlmann, with the help of Philippe Walker, had launched NEOMED, an organization who when AstraZeneca made its decision to close its research centre in Montréal, stepped into the facility and transformed it into a unique one-stop-shop for drug development. Moreover, as CEO and president, Fehlmann had in a short time positioned NEOMED as a key contributor to both the success and sustainability of the biopharmaceutical industry in Québec. Lirette’s hope was that NEOMED could do with GSK’s Laval site what it had done with the AstraZeneca R&D Centre.
“We would talk from time-to-time about the great science resources gathered in Québec, and kick around various ideas to build on this, and when I told him about my ideas for our facility, he was receptive and before long a new partnership was born.”
The first announcement that the two sides would work together came in February 2015, and by April an official agreement was reached to repurpose the building into a new Biologics and Vaccine Centre of Excellence. The agreement included the lease and sublease of the facility to NEOMED and a framework for R&D collaboration between the two entities. This includes GSK paying the entire cost for leasing the facility for five years; representing an investment of $10 million. Additionally, the 66,000 sq. ft. facility would be transformed into a multi-tenant hub for independent, small and medium-sized enterprises focusing on the development of biologics and vaccines.
Another caveat of the proposed partnership is that it will ensure that the expertise remains in Montreal. Specifically, it will allow
The Laval site was inaugurated in April 2015. The building has a total area of 70,000 square feet, 62% of which is directly available for research and development activities.
both the preservation of jobs and the eventual creation of new positions. Of GSK Laval’s 122 permanent employees, approximately 60 per cent have been transferred over to the new Centre of Excellence.
“I’m very proud to say that we’ve been able to maintain more than half. At the original announcement in February the number was 50 percent so I could not be more thrilled it has grown,” says Lirette. He adds that people should stay tuned, because he believes the number of jobs in this partnership will continue to grow.
Fehlmann says that for NEOMED, the timing of this opportunity couldn’t have been better. Having already filled the once vacant AstraZeneca R&D Centre with 23 independent small and medium-sized companies employing 175 people, he recognized the opportunity as a chance to do it all again.
“For a while now we have needed to add a second top-class facility for research and development as we are completely full and have very long waiting list of potential tenants at our Saint Laurent site,” says Fehlmann. “Additionally, when we started NEOMED, it just happened that the Centre we inherited from AstraZeneca was completely equipped and dedicated to medicinal chemistry. We continued along that line and built everything according to that first specialization. Of course, we were missing the other part of the story in the life sciences value chain.”
That other part pertains to the emergence of “biologics,” drugs that consist of giant molecules, hundreds of times the size of a conventional drug molecule, which are manufactured inside animal cells or micro-organisms such as bacteria as treatments for disease. He explains
that half of today’s pharmaceutical market is biological products, and that number is only going to continue to grow.
“The incorporation of this facility into NEOMED now means we have the entire pharmaceutical market covered, which translates into more opportunity” says Fehlmann.
Lirette also believes the building has all the tools needed to help NEOMED get to where it wants to go. “The site has some of the best in class lab space for biologics, having been a North American leader in developing flu vaccines and antibodies,” he says.
Both men agree that small and mediumsized companies that move into this new centre will benefit from GSK’s scientific heritage as well as from its research facilities, labs and highly specialized equipment.
“The centre will provide many Québec, Canadian and foreign companies with access to state-of-the-art facilities and remarkable expertise,” says Max Fehlmann.
Both sides are now actively working to transform the site and already they have had a number of start-up companies interested in beginning their activities at the Centre. As for other tenants they are hoping to recruit, they say the focus will be in the biologics and vaccine space. However, there are other select requirements.
“We will be very open to ideas, but the feasibility of the project has to be high. Feasibility is the key word,” Fehlmann says. “As an example, we won’t go for say Alzheimer’s, because we know it’s too difficult, expensive and takes too long for us to get possible revenue from out licensing within a reasonable time. We will avoid those indications that we know are too expensive and too long. However, there’s no decision to restrict ourselves to certain indications as long as we can test the appetite of pharma for any indication that is coming for the proposed project.”
In terms of the R&D collaboration, GSK and NEOMED say they will each invest $10 million to fund up to five product research and development projects that will be transferred from GSK.
“These projects will be conducted by us according to a plan and a budget agreed upon by both parties using that $20 million and then, at a given milestone, GSK has the right to take its project back. In that case, they will pay us a success fee. In the case they decide not to take it back for any reason, they have to leave the project with us through an exclusive license. It means we are both sharing the risks, the costs and the benefits of taking these projects forward,” explains Fehlmann.
In terms of the logistics of the new building, Fehlmann says much of what they are trying to do with the GSK building is the same as it was with AstraZeneca, but with some subtle differences. The biggest of which is the creation of a specialized Contract Research Oorganization (CRO). According to Fehlmann, the CRO, called NEOMED Labs, will occupy about one-quarter of the building. “It will market its biology and clinical immunology services to the business community,” he says.
Additionally, the 60 people transferred from GSK, who are mostly researchers and technicians, will all be part of this CRO. GSK has already signed on to buy clinical testing services from this CRO for at least three years, representing an investment of $27 million and the total overall GSK has committed to the Centre’s establishment to $47 million.
Despite these differences with AstraZeneca deal, Fehlmann says the end goals remain the same for NEOMED.
“The goal is still to create a hub in which the different parts of the value chain are under one roof, as well as developing promising ideas that emerge from the university milieu and biotechnology companies,” says Fehlmann.
In this sense he likens NEOMED to a bridge, taking the best projects from universities and linking them with the needs of pharma and trying to make it “a win-win situation where everybody can be happy with the results of the development of the project.”
“Everyone knows how good our universities are in the field – with the needs of the industry, those needs are not just Canadian but they are global needs in the industry, this is something very valuable. This is also a way of attracting private investment in R&D in Canada and attracting the attention of the global industry towards Canada. I think those are very positive parameters for us, for NEOMED, for Montreal and Québec, but also for Canada.”
He is very adamant about this last point, specifically that for Québec, this partnership is a fantastic opportunity.
“It’s about keeping good jobs and expertise in Canada, maintaining a fantastic heritage of drug discovery that came with having these different companies and their research Centre’s located here. Most importantly, I truly believe that we can duplicate all that we’ve previously accomplished at the AstraZeneca facility here. It’s win-win for all involved,” Fehlmann says.
Commenting on the partnership, Lirette says it is a testament to how visionary the province of Québec has been in putting infrastructure in place to seize opportunities stemming from global changes in pharma research models.
“The NEOMED concept was born and bred in Québec as Montréal In Vivo and the Québec government worked hard to create NEOMED years ago. With NEOMED - the Silicon Valley of Québec as I like to call it - Québec has created a unique and favorable environment to leverage the continuing externalization of R&D and GSK is pleased to work with NEOMED to create this Centre of Excellence.”
He also echoes Fehlmann’s statement that this is a win-win for all parties.
“We’ve worked hard, and invested a lot, in putting this new arrangement in place. And, obviously, we will be seeking to leverage it as much as possible. I don’t see any limits. And remember, these facilities are not just for GSK R&D but are open to others pursuing the most advanced science. For these reasons, I truly believe this is the dawn of a new and promising era for pharmaceutical research in the Montréal region.”
— Max Fehlmann
To see this story online visit http://biotechnologyfocus.ca/ on-the-map-belgium-is-readyto-be-a-leader-in-the-lifesciences
