Biotechnology Focus November 2010 by Promotive Communications

INSIGHTS FOR THE LIFE SCIENCE INDUSTRY

25 anniversary

BIOMEDICAL POWERHOUSE

HOW THE SAMUEL LUNENFELD RESEARCH INSTITUTE OF MOUNT SINAI HOSPITAL BECAME ONE OF THE WORLD’S TOP 10 PERFORMERS

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NOVEMBER 2010 VOLUME 13, NUMBER 10

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contents NOVEMBER 2010 – VOLUME 13 – NUMBER 10

10 A BIOMEDICAL POWERHOUSE

Opinion

Samuel Lunenfeld Research Institute of Mount Sinai Hospital: celebrating 25 years of exciting discoveries.

How massive changes in the structure of the pharmaceutical industry has led to industry consolidation.

FEATURES BIOMEDICAL POWERHOUSE How the Samuel Lunenfeld Research Institute of Mount Sinai Hospital became one of the world’s top ten performers for biomedical research (By Karin Fleming)

EVEN BIGGER PHARMA? Big pharma continues to get bigger as industry consolidation kicks into high gear. (By John Lawson and Pierre Bourassa)

THE INAUGURAL TECH TRANSFER SUMMIT NORTH AMERICA International platform for early stage SME, biotech industry-academia partnering, licensing and collaboration comes to Toronto. (Compiled by Shawn Lawrence)

DEPARTMENTS

IN EVERY ISSUE

RESEARCH NEWS

BUSINESS CORNER

27 CALENDAR OF EVENTS 28 THE LAST WORD

9 BUSINESS CORNER

Theratechnologies announces retirement date for president and CEO www.bioscienceworld.ca

ACROSS CANADA Dr. Pierre Meulien steps in as Genome Canada’s new president and CEO (By Shawn Lawrence)

INNOVATOR In just six short years, Suman Rakhit has built a company with a pipeline that continues to produce new drug candidates (By Tim Bryant)

NOVEMBER 2010 BIOTECHNOLOGY FOCUS 3

PUBLISHER’S NOTE PUBLISHER/ EDITOR-IN-CHIEF SENIOR WRITER

An exchange of ideas and partnerships at this year’s

BioContact

ore than 600 delegates attended BioContact last month in Québec City. This was the 17th annual event which brought participants together to exchange ideas and discuss new ways of doing business. The president of BioContact, Martin Godbout, addressed this need to find new ways of doing business, stating that “In a world in which all of the biopharmaceutical industry players need to increase their productivity, while reducing their R&D expenditures and where governments are forced to contain the costs related to healthcare, we will have to change our business model and the way in which we think and work.” Godbout went on to state that even though the worldwide biotech industry is experiencing difficult times right now, it’s not all doom and gloom. Godbout made reference to the many positive outcomes for the industry. “New diagnostic tests, innovative drug entities that target a disease more accurately, sophisticated electronic data storage and transmission, are amongst the elements that are revolutionizing healthcare while paving the way to personalized medicine.” The conference saw some major players in the pharmaceutical industry as presenters. GlaxoSmithKline, Merck, Pfizer, Sanofi-Aventis and for the first time, the Danish company Novo Nordisk all presented. As well, venture capital funds in New York and Boston were on hand. Godbout summed up the event as a “kind of fashion show in which over a 100 biotech companies present their products to pharmaceutical companies who need access to new molecules to develop new drugs.” This year saw emphasis on forming strategic alliances between biotech and big pharma, one of the new realities in the industry today. The conference welcomed more than 100 biopharmaceutical companies under such disciplines as cancer, cardiology, endocrinology/metabolism, genomics/proteomics, neurobiology, immunology/infectiology and medical technologies. It was a combination of personalized meetings between biopharmaceutical and pharmaceutical companies, universities, consulting firms, venture capital companies and government representatives.

STAFF WRITER

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Tim Bryant

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Pierre Bourassa

John Lawson

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R & D NEWS Arthritis chair’s first appointee shares vision Charles Goldsmith, a clinical epidemiologist and biostatistician who is passionate about helping people with musculoskeletal diseases such as arthritis, is the first appointment to a new arthritis chair at Simon Fraser University. The SFU Faculty of Health Sciences (FHS) professor and professor emeritus of biostatistics at McMaster University has published more than 270 papers in the field of clinical epidemiology. Goldsmith is internationally recognized for leading the development of evidence-based decisionmaking in medical practice. Goldsmith shared his vision of what he plans to accomplish as the inaugural fiveyear appointee to the Maureen and Milan Ilich/Merck chair in Statistics for Arthritis and Musculoskeletal Diseases, at a welcoming reception held last month. “Researchers need to use statistics more effectively to make the science behind what causes arthritis and other mus-

culoskeletal diseases more credible and understandable to clinical practitioners,” said Goldsmith. “This will help front line clinicians translate research into therapies and medicine that can help mitigate the $16 billion annual cost of Canada’s second most costly group of diseases.” The latest available statistics (2000) indicate arthritis and other musculoskeletal diseases debilitate nearly four million Canadians over age 15 - approximately one in six people. By 2026, Health Canada estimates that more than six million Canadians will have arthritis. The Milan and Maureen Ilich Foundation, Merk-Frosst Canada Ltd., ARC and FHS raised the $4 million needed to fund the endowed chair to which Goldsmith is the first appointee. The chair serves as the foundation for the world’s only interdisciplinary research partnership devoted to arthritis and musculoskeletal diseases.

Clinical Trials & Patents Teva Pharmaceuticals Industries Ltd. and OncoGenex Pharmaceuticals (Vancouver, BC) initiates SYNERGY, a global Phase 3 trial evaluating custirsen (also known as OGX011/TV-1011) as first line therapy for the treatment of castrate-resistant prostate cancer (CRPC). The SYNERGY trial is the second of three Phase 3 trials to be initiated under a global collaboration and license agreement between Teva and OncoGenex to develop and commercialize custirsen. The SYNERGY trial is a randomized, controlled, global Phase 3 trial to be conducted in approximately 125 cancer centres and with designated recruitment of 800 men with metastatic CRPC who have disease progression and require first-line docetaxel/prednisone chemotherapy. Patients will be randomized to receive treatment with either docetaxel/prednisone plus custirsen or with docetaxel/prednisone alone. The primary endpoint of the trial is to determine whether overall survival is longer in the custirsen treatment arm. n

Lorus Therapeutics Inc. (Toronto, ON) announces the allowance of a patent in the U.S. for novel drug candidates from Lorus’ small molecule program. The U.S. patent covers composition of matter of Lorus’ lead antimicrobial compound LOR-220 and related small molecules. This patent also provides Lorus with patent protection for antimicrobial compositions based on LOR-220 for inhibiting growth of a variety of drug-resistant bacteria, including methicillin-resistant Staphylococcus aureus (MRSA) and vancomycin-resistant enterococci (VRE). This is the first U.S. patent allowance from Lorus’ small molecule program. Lorus has issued patents for LOR-220 in Australia and China, as well as pending patents for this compound in other countries worldwide. n

Richard Reznick

Queen’s dean of Health Sciences wins international prize in medical education

Richard Reznick, dean of Health Sciences at Queen’s University, has been awarded the 2010 Karolinska Institutet Prize for Research in Medical Education for his work in surgical education. “This is like the Nobel Prize for medical education,” said Queen’s Provost and vice-principal (Academic) Bob Silverman. “It is a huge international recognition of Dr. Reznick and his work. The Queen’s community congratulates him on this significant achievement.” The Karolinska Institutet Prize for Research in Medical recognises high-quality research in the field and promotes long6 BIOTECHNOLOGY FOCUS

NOVEMBER 2010

term improvements of educational practices in medical training. “It’s an enormous honour to be recognized for this prize,” said Dr. Reznick. “The prize is appreciated with respect to personal recognition, but is more significant as an affirmation that surgical education can be a bona fide academic pathway.” Professor Reznick’s primary research into surgical education has focused on performance-based assessment, technical skill acquisition and simulation, all with the aim of improving practice. He participated in the development of a checklist that today is used globally to reduce surgical complications. Dr. Reznick’s work in surgical assessment and simulation has also led to the development of a novel competency-based curriculum that is currently being tested as potential new way of training surgeons. He is a fellow of both the Royal College of Physicians and Surgeons of Canada and the American College of Surgeons. Dr. Reznick began his term at Queen’s in July. Professor Reznick and co-winner David Irby of the University of California, San Francisco will lecture at the Stockholmbased institute in November and receive their awards at a special ceremony. They will also share the €50,000 prize.

Helix BioPharma Corp. (Aurora, ON) releases positive efficacy and safety findings from its recently completed Phase 2 pharmacokinetic study of Topical Interferon Alpha2b in patients with low-grade cervical lesions. These findings build upon the positive pharmacokinetic findings from this study announced in the company’s press release of June 23, 2010. Using colposcopic directed biopsy to determine the treatment’s effectiveness, 71.4% of the women in the study no longer had potentially pre-cancerous, lowgrade lesions known as cervical intraepithelial neoplasia grade 1 or 2 (CIN 1 or CIN 2) following treatment. Colposcopic directed biopsy is generally considered the leading method for diagnosing potential cervical precancer today. In addition, Topical Interferon Alpha2b demonstrated an excellent safety profile, with no significant local intolerance findings and no serious adverse events. n

R & D NEWS Biotech tools promise safer foods and disease-preventing diets In a world expected to be home to more than nine billion people by the middle of this century, it will take more than small tweaks to our agricultural systems to feed us all, says Dr. Karl Dawson, director of worldwide research for U.S.-based Alltech Inc. “We are now in a situation where we have to look for quantum leaps,” says Dawson. “We’re going to have to change our base technology, and biotech is probably the way to go.” Dawson was the second of two keynote speakers at the second day of the Agricultural Biotechnology International Conference (ABIC 2010) in Saskatoon. Biotechnology has already yielded pest and drought resistance, as well as improved quality. New advances in enzyme technology promise new ways to process crops to get more value from them, and to improve digestion in animals so they make more efficient use of feed. Advances in biotech also promise to revolutionize food safety. “In my view, the biggest use (of these technologies) is the safety and traceability

of our food chain,” Dawson says. Current techniques test for how much of a given contaminant is in a food sample. The problem is that detection equipment has gotten better and better - to the point where the new equipment can detect substances at parts per quadrillion. That’s a one with 12 zeroes behind it. With this kind of sensitivity, it makes “zero tolerance” policies for food safety impossible. “The test tells us it is there,” Dawson says. “But do we really need to be concerned if we have one part per quadrillion of PCBs?” A better measure is whether or not the food contaminant has any harmful effects. Biotech researchers have harnessed our knowledge of genetics to produce new, fast, and extremely accurate tools. They work by monitoring how gene function is altered, because if gene function is altered, the effect is seen throughout the body. New tests called microarrays are able to detect changes in the function of tens of thousands of genes simultaneously, providing results in hours instead of days. These systems (Alltech’s version is called GeneChip) are used to look at the effects of toxins as well as nutrients. “We have a tool now for teasing out these

intoxicants or contaminants in the food system - a very powerful tool,” Dawson says. “It’s based on biological risk, not perceived risk.” These same advances in biotechnology are also being used on the other side of the equation: nutrigenomics, or how to design our diets to maintain and enhance our health. For example, Dawson and his colleagues used a 60,000-gene array to test the effects of selenium in chickens. The results were markedly different for this micronutrient, depending on what form it was in (selenium salts vs selenium in yeast). In cattle, genes in the mitochondria, the cells’ “power plants,” were cranked up by a supplement, allowing the animals to produce more milk. The technology can also be used to design diets to help prevent diseases such as Alzheimer’s. Initial research with certain supplements suppressed the action of the genes that code for the plaques that are characteristic of the disease. “This is very interesting, because it suggests there are nutritional things you can do to start preventing (disease),” said Dawson.

Reply Card #4797

NOVEMBER 2010 BIOTECHNOLOGY FOCUS 7

R & D NEWS Genome British Columbia releases research on the balance of bacteria in women’s bodies

A team of Canadian researchers is examining the delicate balance of bacteria and viruses in women’s bodies in order to optimize women’s health through their lives. Dr. Deborah Money at the Women’s Health Research Institute in Vancouver is leading the initiative, called the Vaginal Microbiome Project, which will examine the communities of microorganisms (bacteria and virus-

es) in the vagina in order to determine what a healthy bacterial balance is for women. “We know that a healthy balance is critical to preventing vaginal infections, protecting against sexually transmitted infections and preventing pregnancy loss and preterm birth,” said Dr. Money. “To date, we have not been able to study this ecosystem adequately because it is difficult or impossible to grow some of the bacteria in the lab, and we currently have poor methods of assessing the population of microbes.” Genomics is making it possible to crack this mystery. Dr. Money’s team can rapidly sequence up to hundreds of thousands of the bacteria. “What’s important about this approach is that we are not looking at a single bacteria in isolation,” said Money. “We are able to look at whole communities and how they interact with each other, which is critical to understanding how a woman keeps healthy, and to identifying when something is going wrong with her reproductive system.” The project is funded by the Canadian Institutes of Health Research (CIHR), through their Canadian Microbiome Initiative, and

Genome BC, each contributing $1,745,341 and $581,781 respectively for a total of $2,327,122 over five years. One of the major consequences of abnormal bacterial balance in the vagina is preterm birth. Preterm birth rates are increasing for Canadian women, now at rates of almost 8 per cent, and are responsible for 70 per cent of newborn deaths and 50 per cent of long-term adverse health consequences for infants. This project will study the bacterial populations associated with preterm birth and develop diagnostic tests in order to prevent preterm birth. “Studies to prevent preterm birth are of importance not only for Canadian women but for women worldwide where preterm birth has even more serious consequences,” says Money. The project will be lead by Dr. Money at University of British Columbia, based at the Women’s Health Research Institute, with her co-leads, Drs. Janet Hill at the University of Saskatchewan, Dr. Sean Hemminsgen at the National Research Council, Dr. Gregor Reid at the University of Western Ontario, and Dr. Alan Bocking at the University of Toronto and many other collaborators across Canada.

Dealmakers ProMetic Life Sciences (Montreal, QC) and Allist Pharmaceuticals, Inc., enter into a strategic agreement to develop and commercialize ProMetic’s drug candidates PBI-1402 and PBI-4419 in China. This agreement strengthens ProMetic’s development plan for these assets in other markets. Allist will fund the development costs required for the regulatory approval in China for the two products. As part of the conditions for the rights granted, Allist undertakes to perform development activities according to standards meeting FDA requirements, which will then allow ProMetic to have full access to and use the data generated by Allist for markets outside China. This represents an investment in the programs well in excess of US$10 M. Allist will retain the rights for the Chinese market for PBI-1402 for the chemotherapy-induced anemia and cancer related anemia indications and for PBI-4419 for fibrotic diseases. n

Afexa Life Sciences Inc. (Edmonton, AB) signs an exclusive in-license agreement with Lisoma International Ltd. and Lisoma Canada Ltd. Under the agreement, Afexa has been granted the exclusive Canadian rights to use, develop, market, sell and distribute Lisoma’s proprietary natural health product for the treatment of cold sores. The product was recently n

8 BIOTECHNOLOGY FOCUS NOVEMBER 2010

granted a Natural Product Number (NPN) from Health Canada’s Natural Health Products Directorate, allowing the product to be sold in Canada as an over-the-counter remedy to relieve the pain of cold sores and to speed healing time. Afexa previously announced at its annual meeting in August, 2010 that it intended to in-license a natural health product that meets Afexa’s standards and is consistent with its vision and mission. The announcement fulfills that objective. Further details will be announced prior to a product launch which is expected to occur within the next 12 months. OncoGenex Pharmaceuticals, Inc. (Vancouver, BC) prices a public offering of 3,174,602 units, with each unit consisting of one share of the company’s common stock and one-half (1/2) of one warrant, at a purchase price of $15.75 per unit for an aggreate offering amount of $50 million. The net proceeds to OncoGenex, after underwriting discounts and commissions and other offering expenses, from the sale of the units are expected to be approximately $46.7 million. The company intends to use the net proceeds from the offering primarily to advance its product pipeline, including its lead program, custirsen, and OGX-427, which is currently in clinical development as a treatment for prostate cancer and n

bladder cancer, as well as for general corporate purposes. Each whole warrant will be exercisable at any time on or after the date of issuance until the fifth anniversary of the date of issuance at an exercise price of $20. The shares of common stock and warrants are immediately separable and will be issued separately. The offering was to close last month, subject to customary closing conditions. Trans-Hit Biomarkers and Caprion Proteomics Inc. (Montreal, QC) enter into an alliance agreement with Caprion Proteomics Inc, a leading provider of proteomics-based biomarker discovery and validation services. Trans-Hit Biomarkers Inc. is a provider of high-quality clinical sample collections. Trans-Hit Biomarkers and Caprion will combine its expertise to deliver an integrated service approach, called ‘’ProteomeHit’’ for accelerating clinical development and validation of novel protein biomarkers. By combining Trans-Hit’s access to high-quality biospecimen collection with Caprio’ns mass spectrometry-based MRM assays for high-throughput, multiplexed quantitative measurement of proteins, ‘’Proteome-Hit’’ will allow rapid multiplexed measurement of protein biomarker candidates on large number of patient samples from high-quality biospecimen collections. n

BUSINESS CORNER

Yves Rosconi . Photo Ivanoh Demers, Archives La Presse

Theratechnologies announces retirement date for president and CEO

Theratechnologies announces that Yves Rosconi will retire from the company on Nov. 30 with John-Michel T. Huss assuming his responsibilities as the new president and CEO on December 1. Rosconi will remain available as an advisor to the new president and CEO until the end of the year. Rosconi has been at the helm of Theratechnologies for the last six years and was responsible for leading the late-stage clini-

cal program for tesamorelin in HIV-associated lipodystrophy as well as the regulatory process towards product approval in the U.S.. Rosconi also played an important role in signing a partnership for the exclusive commercialization rights to tesamorelin for the treatment of excess abdominal fat in HIV-infected patients with lipodystrophy in the U.S. “Yves has been an excellent CEO for Theratechnologies,” said Paul Pommier, chairman of the board of directors of Theratechnologies. “He was the right leader at the right time and was able to bring focus and discipline to the company during a time when it was greatly needed. Under his direction, Theratechnologies produced results that culminated into a company that is well positioned for growth in the future.”

Stem Cell Therapeutics appoints chief financial officer Stem Cell Therapeutics Corp. appoints Michael Cook as chief financial officer of the company. Cook has his Chartered Accountant and Chartered Business Valuator designations. He has over 15 years of business experience and has expertise in corporate finance, pri-

vate equity, and corporate management. Cook brings a combination of skills and experience to the team at Stem Cell Therapeutics. Alan Moore, CEO of the company remarked, “We are fortunate to have Mr. Cook in the key role of CFO and we welcome him to the management team.”

Amorfix Life Sciences makes appointment to its board of directors Amorfix Life Sciences appoints Dr. Walter von Wartburg, currently partner in private law practice and executive chairman of Medgate AG, a leading provider of medical information services, to the board of directors. Dr. von Wartburg has held senior management positions within the global pharmaceutical industry including Roche, Ciba-Geigy and Novartis for over 20 years, specializing in US/EU regulatory affairs for drug and medical devices. He is professor of public health policy at the Saint Gall Graduate School of Economics, Business and Public Administration, a law graduate of the Universities of Basel, Paris, Princeton, Stanford and Harvard Law School, and author of books and articles on subjects ranging from drug legislation, social acceptance of gene technology, and issues of management and business administration. Dr. von Wartburg is founder-president of the Swiss Foundation for the mentally handicapped “PRO MENTE SANA”, a member of the Bioethics Institute Advisory Committee of Johns Hopkins University, President of the Basel Opera and Theatre and Co-chairman of the International culture Foundation PRO EUROPA. In addition, the company also announced that it has engaged Posada & Associates, Inc. to assist the company with business strategy and partnering transactions.

Reply Card #4798 NOVEMBER 2010 BIOTECHNOLOGY FOCUS 9

By Karin Fleming

BIOMEDICAL RESEARCH

BIOMEDICAL

HOW THE SAMUEL LUNENFELD RESEARCH INSTITUTE OF MOUNT SINAI HOSPITAL BECAME ONE OF THE WORLD’S TOP 10 PERFORMERS

POWERHOUSE “I was always impressed by the quality and depth of expertise at the Lunenfeld, it has always out-punched its weight class and consistently raised the bar in scientific accomplishments.” – Dr. Jim Woodgett

Starting and maintaining a successful biomedical research institute is just like science itself: an experiment. Some work, some don’t, and much of it is calculated guesswork with skillful adjustments along the way. The unpredictability of research and its vulnerability to economic and industry-related trends, as well as fierce competition for funding from government or donors can undermine the best laid plans. The Samuel Lunenfeld Research Institute of Mount Sinai Hospital — celebrating its 25th anniversary this year — is regarded as one of the world’s top 10 centres in biomedical science, and one of Ontario’s primary centres for genetics research and molecular medicine. As a testament to the Lunenfeld’s success, when compared with peer universities or research centres: • Lunenfeld researchers consistently attract competitive research funds at rates above (and often double) the national average; • In 2009, Lunenfeld investigators authored over one quarter of the primary research papers in the top 30 biomedical journals published by all Toronto health scientists — even though Lunenfeld researchers represent under five per cent of the total number of biomedical researchers in the city; • Almost 90 per cent of the Lunenfeld’s funding is derived from competitive research granting agencies, and; • Lunenfeld scientists currently hold more than $200 million in grants and awards. The Lunenfeld was a model for other successful Canadian research centres including the Institute for Research in Immunology and Cancer (IRIC) in Montréal, as well as the Terrence Donnelly Centre for Cellular and Biomolecular Research at the University of Toronto. So what makes good science great, how do research institutes succeed, and what are the challenges and

10 BIOTECHNOLOGY FOCUS NOVEMBER 2010

opportunities facing biomedical research centres in Canada? How does the Lunenfeld, a small research centre compared with its peer institutions, consistently lead efforts in biomedical research? To explore these questions, we talked with past and present directors of the Lunenfeld, as well as directors of other leading biomedical research institutes in Canada.

Early days at the Lunenfeld “I had a very simple plan,” says Dr. Lou Siminovitch, the Lunenfeld’s inaugural director. “I was not going to just hire scientists; I was going to hire leaders. We started out like a ball of fire—with good people, firstrate research and excellent programs.” It was 1985, and Dr. Siminovitch’s strategy upon beginning his nine-year directorship of the Mount Sinai Hospital Research Institute would lead his team of talented young scientists to become a virtual phenom in the global biomedical community. Dr. Siminovitch, who had developed research teams at the Ontario Cancer Institute and The Hospital for Sick Children, began his role as director by recruiting 30 internationally renowned investigators divided among five multidisciplinary teams. According to Joseph Mapa, president and CEO of Mount Sinai Hospital, “The rationale for a research institute within the Hospital was the pursuit of excellence, and the philosophy that its presence would improve and enhance patient care in terms of knowledge transfer, and the caliber of clinicians and scientists attracted to our hospital.” In a quantitative sense, after only three years the Institute’s scientists had already published 150 papers in leading peer-reviewed biomedical journals and obtained over $10 million in operating and salary awards from external agencies, reflecting the quality and impact of these investigators on the world’s scientific stage.

BIOMEDICAL RESEARCH Critical support from donors In 1989, the Samuel Lunenfeld Foundation donated $7.5 million to the Institute. At that time, it was one of the largest gifts to medical research in Canadian history. In recognition of this gift, the Mount Sinai Hospital Research Institute was renamed the Samuel Lunenfeld Research Institute of Mount Sinai Hospital. After Lunenfeld’s passing, his family carried on a tradition of giving in support of research at Mount Sinai. Since the Lunenfeld’s inception, the Mount Sinai Hospital Foundation has contributed approximately $175 million in support of Lunenfeld research. “This ongoing support is essential in providing stability to the Institute and enables efficient infrastructure as well as matching funds for external awards,” says Dr. Jim Woodgett, the Lunenfeld’s current director.

New leadership, continued success In 1994, the directorship transferred to Dr. Alan Bernstein, one of the Institute’s original scientists, who was committed to furthering the Lunenfeld’s internationally renowned excellence in fundamental science, while strengthening its interactions and collaborations with the hospital. “At that time, the science at the Lunenfeld really took off and our investigators blossomed,” says Dr. Bernstein, who later became the inaugural president of the newly created Canadian Institutes of Health Research and is now executive director of Global HIV Vaccine Enterprise in New York. In preparing for the 21st century and its accelerating pace of discovery, new projects were initiated in 1998 in the Lunenfeld’s Proteomics and Bioinformatics division, the Centre for Modeling Human Disease, and the Fred A. Litwin Centre for Cancer Genetics. “These initiatives have proven to be a model for other research institutes and a key factor in enhancing the Lunenfeld’s pre-eminence in biomedical research on a global scale,” says Dr. Bernstein. And consistent with early traditions at the Lunenfeld, the new teams were encouraged to intersect with the clinical interests of Mount Sinai Hospital. “The Lunenfeld is well poised to make a big impact because of the combination of detailed clinical information and sophisticated science,” says senior investigator Dr. Lee Adamson, who was recruited in 1986 to join the Lunenfeld’s Perinatology Division. (The Lunenfeld is now comprised of 34 Principal Investigators, nine of whom are MDs and practising physicians.) The Lunenfeld also benefited from the opening of the Research Training Centre in 1998, a program that offers trainees (drawn to the Lunenfeld from countries as far ranging as Iran, China,

Belgium, Korea and more) an exceptional researchbased learning environment. “Perhaps our biggest contribution to biomedical research in Canada is the network of trainees from our centre who act as ambassadors for the Lunenfeld,” says senior investigator Dr. Jim Dennis, whose lab recruits several new trainees each year. Dr. Tony Pawson, distinguished investigator and Apotex chair in Molecular Oncology, took up the directorship in 2000, keeping the Lunenfeld at the forefront of scientific advances. “From the beginning, the ethos of the Institute has remained the same. We recruit outstanding young scientists, promote tremendous collaboration and nurture new ideas,” says Dr. Pawson. “It’s extremely rewarding and stimulating to think of what has been done, and what will be done.” That year, the federal and provincial governments awarded Lunenfeld researchers a combined $20 million through innovation competitions, which allowed for the establishment of exciting new programs of scientific research including the Centre for Genomic Medicine and the Prosserman Centre for Health Research. These centres enabled the Lunenfeld to participate in worldwide endeavours to map the human genome and better understand gene and protein function, with the goal to enhance the diagnosis and treatment of diseases including cancer, diabetes, immune and nervous system disorders, as well as developmental disorders. New funding also helped the Lunenfeld leverage increasingly advanced techniques to study the genetics of human diseases and analyze gene and protein function, using some of the world’s most sophisticated instruments for mass spectrometry, robotics and informatics, imaging, computational approaches, proteomics, X-ray crystallography, DNA microarrays and more. For example, the Lunenfeld’s leading-edge robotics facility, pioneered by Dr. Jeff Wrana (senior investigator and the Mary Janigan Research chair in Molecular Cancer Therapeutics) enables researchers at Mount Sinai Hospital and among Ontario’s biomedical community to analyze the function of thousands of genes at a time, and rapidly identify the properties and processes important in human disease. “When I first started working in research, scientists were arguing about whether genes were made of proteins or DNA; now, we’re conducting genome-wide sequencing,” says Dr. John Roder, Lunenfeld senior investigator and a world-renowned neuroscientist.

“I had a very simple plan, I was not going to just hire scientists; I was going to hire leaders. We started out like a ball of fire—with good people, first-rate research and excellent programs.” – Dr. Lou Siminovitch

NOVEMBER 2010 BIOTECHNOLOGY FOCUS 11

BIOMEDICAL RESEARCH Lunenfeld researchers continue to make inroads into the prevention, detection, and treatment of cancer, diabetes, arthritis, osteoporosis, psychiatric disorders, kidney disease, women’s and infants’ health, inflammatory bowel disease, and spinal cord injury. From extraordinary discoveries in cancer research, to leadingedge breakthroughs in stem cell biology, Lunenfeld experts are taking steps daily to improve the health of Canadians.

SOME OF THESE RECENT BREAKTHROUGHS INCLUDE: The development of a new miniaturized technology that could lead to more sensitive diagnostic tests to assess the risks of diseases such as breast cancer; The discovery of a technique that allows scientists to monitor two-way communication between cells for the first time; Leading-edge research elucidating a new means by which cells repair damage to their DNA, which is helping scientists to understand early events in the genesis of cancer, and; The discovery of a new genetic pathway (a gene ‘road map’) that could provide individualized treatment options for patients with a devastating liver disease.

A model for other biomedical institutes in Canada Along with the Lunenfeld, other Canadian research centres including IRIC in Montréal and the Terrence Donnelly Centre for Cellular and Biomolecular Research at the University of Toronto have grown and flourished in a climate that fosters preeminent biomedical research. Dr. Guy Sauvageau, IRIC’s chief executive officer and Scientific director believes that the spectacular growth in biomedical knowledge and technology in Canada is in large part due to support from government agencies including the Canada Foundation for Innovation (CFI), the Canadian Institutes of Health Research (CIHR) and the Canada Research Chair program. “In the U.S., for example, this kind of support is not available,” says Dr. Sauvageau. “A massive investment from the CFI, CIHR and others has allowed us to build multiple technology platforms and recruit and retain top-notch scientific talent.” Established in 2002, IRIC is a fully integrated systems biology research and training centre focused on immunology and cancer, and is home to 25 principal investigators. Determined to offer the best research environment possible to support the work of an elite team of investigators, the Université de Montréal sought the counsel of some of the most respected health research leaders in the international community before establishing IRIC as its research institute. “We consulted with key players at the Lunenfeld, the Max Planck Institutes in Germany and the Institute for Systems Biology in Seattle,” says Dr. Sauvageau. “The Lunenfeld had and still has a history of scientific excellence and definitely influenced our early development. Its team brought the spirit of where biomedical science is going in Canada, specifically to invest in systems biology and leading-edge technology to approach biomedical problems strategically.” Dr. Sauvageau says this consultation proved invaluable in helping 12 BIOTECHNOLOGY FOCUS NOVEMBER 2010

the Université de Montréal refine its vision for IRIC. He also notes that smaller, successful research centres such as the Lunenfeld and IRIC share common features including access to early clinical studies (which assists researchers in translating their discoveries into clinical benefits, a feature made possible through collaboration with clinician–scientists who are practicing MDs), affiliation with a university campus and collaborative multidisciplinary teams. Dr. Brenda Andrews, a leading Canadian yeast genomics researcher and director of the Donnelly Centre in Toronto, adds that open-concept labs have allowed smaller centres to maximize their collaborative capabilities. “The open-concept aspect of the Lunenfeld’s labs influenced our early development. The Lunenfeld also has an amazing mix of scientists studying various model systems and leveraging innovative technologies. The environment really encourages people to interact.” In the late 90s, the Faculties of Medicine, Pharmacy, and Applied Science and Engineering at the University of Toronto came together to envision a Centre for Cellular and Biomolecular Research. In 2005, the Terrence Donnelly Centre for Cellular and Biomolecular Research opened its doors to world-renowned researchers from many disciplines focused on identifying the causes and cures of diseases. “We’ve put together a collaborative team with various areas of expertise focused on biomedical questions and problems. In this way, we’re moving faster and in new directions to help solve some of the most pressing issues in human health and diseases,” says Dr. Andrews. “Smaller research centres can be nimble, adapt to trends and function as a community. You can choose your mission together.” Collaborations are also important between institutions. For example, the Lunenfeld and the Donnelly Centre will both benefit from the joint affiliation of Dr. Fritz Roth, an acclaimed computational and cellular biologist jointly recruited from Harvard Medical School, by both centres. Dr. Roth was selected as an inaugural Canada Excellence Research Chair (CERC) earlier this year. His role as a CERC is part of a new program initiated by the federal government, to attract the world’s most renowned researchers to universities and institutes across Canada.

The Lunenfeld today, and tomorrow By 2005, the Lunenfeld was already considered one of the top 10 biomedical research centres worldwide. At the end of that year, the Lunenfeld transitioned to the leadership of Dr. Jim Woodgett, a worldclass scientist whose last posting was at the Ontario Cancer Institute of Princess Margaret Hospital. “I was always impressed by the quality and depth of expertise at the Lunenfeld,” says Dr. Woodgett. “It has always out-punched its weight class and consistently raised the bar in scientific accomplishments.” The Lunenfeld’s early adoption of new technologies such as RNA interference (RNAi), highthroughput screening, induced pluripotential stem cells, ultra-sensitive proteomics, high resolution live cell imaging, population health analysis and sophisticated mouse models convinced Dr. Woodgett that the Lunenfeld was superbly positioned to leverage its skills in discovery research, into clinical application within Mount Sinai Hospital—especially in the application of genetic knowledge. “In the past decade, science has revealed how important our individual differences are to propensity for disease or response to therapy,” says Dr. Woodgett. “It feels as though the experience of the past twenty-five years has precisely prepared us for the coming era of personalized medicine. In the next twenty-five years we hope to transform medicine.”

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Reply Card #4799

Funded by the Government of Canada's Sector Council Program

By John Lawson and Pierre Bourassa

COMMERCIALIZATION

EVEN BIGGER PHARMA? WHAT’S NEXT?

Throughout our careers Pierre and I have seen massive changes in the structure and fate of the pharmaceutical industry. “Industry Consolidation”, as it has been dubbed, has been the name of the game.

14 BIOTECHNOLOGY FOCUS NOVEMBER 2010

rom there being over 500 companies doing international pharmaceutical business in 1970, there were only 49 in 2008 and the term Big Pharma (with sales of more than $10 billion) can only be applied to 19 of them. This elite group accounts for 84 per cent of the business1. None of them, incidentally, have their head offices in Canada. Is this a good thing? If so, for whom? If not, why not? In this article we will question the common sense of consolidation from the perspective of various stakeholders. It has been argued that the cost of bringing a drug to market is in excess of $800 million and that consolidation would remove the wasted cost of duplicated research. This assumption was made, however, upon the basis that Big Pharma did everything from soup to nuts – basic research, drug targeting, ADME, clinical research and pre-launch marketing. Is that now the case? No! Perhaps

two-thirds of all new molecules now come from external sources and the industry has become merely an investment resource and global mass marketing machine. Indeed, it has been argued that it is virtually impossible to launch a product globally without the assistance of Big Pharma. From their investors’ perspective, are they now making bigger profits than they were 40 years ago? Are they discovering more new breakthroughs? Are there consistently higher returns than other high technology industries, especially considering that the hunger for healthcare is growing rapidly with an aging population? Have the cost savings deployed by the industry been passed on to the payer? We hardly need try to answer these questions since clearly the industry’s current business model is not working. Cutting costs (Surprise! Surprise!) does not lead to increased innovation. So, why do they continue to pursue such a fruitless strategy?

COMMERCIALIZATION Drug payers are, understandably, anxious not to pay for these cosmetic products but how do clinicians separate physical and mental causes that might be at the root of this demand. Is this really a medical need? It is also perverse that we spend so much on the rehabilitation of individuals who have become hooked on self-abuse substances – alcohol and tobacco, for instance. The personalized medicine dilemma Innovators lately most often come from biotechs and universities. With few companies able to maximize the global marketing potential of the drugs being developed, the negotiating power of innovators is extremely limited. Indeed, few products actually pass the stage-gates of the industry’s new product development process. Filtering is intense. Successful marketing is no longer the final filter. It is lack of funding that kills the majority. It kills products that might otherwise have had a significant, albeit non-blockbuster, potential. But, what choice do these researchers have? Very little, it would seem, if you have a product for the mass-market. Of course, this assumes that all products must have blockbusting appeal to be of interest to Big Pharma but this, sadly, is probably true. Even though the average global pharmaceutical achieves sales of $350 million per year, Big Pharma seeks $1 billion plus. Big Pharma, for instance, has yet to devise a way of dealing with the emerging concept of personalized medicine. It does not fit their mindset. Better diagnostics, stem cell therapy and vaccines, which activate individual immune responses, might fit this category. At best, the industry passively follows such developments with caution to ensure that they are not left behind rather than try to drive it. Indeed, individualized medicine would break the blockbuster paradigm completely, leaving only the processing of autologous and allogenic stem cell cultures (extraction, expansion, differentiation and storage) as fitting the one-size-fits-all paradigm of the industry. Since Big Pharma now subcontracts the majority of its manufacturing activity, this is no longer a core competence. Specialist CMOs are far better at fulfilling this need.

The emergence of theranostics A few companies have invested in diagnostics and successful products have been launched on the basis of emerging theranos-

still far from a point of meeting the often-quoted ‘unfulfilled medical need’. This phrase is rarely omitted from the business plans of emerging biotechs. We must balance, therefore, the element of patient demand against the industry’s capability of supplying.

New life style treatments

tic technology (i.e. diagnosis followed by a therapy). Herceptin™ is an example. From a payer’s perspective this makes sense. Many reports claim that drugs do not work for all patients and many are administered subtherapeutically. Such wastage is hardly the concern of drug manufacturers who merely maximixe patient penetration until their patent expires. There are no money-back guarantees! Comparative data on treatments is often dubious just because of sample numbers. At the same time, cost-effective arguments abound from the industry using data that is intellectually flawed. We seem to forget that humans are mortal – we have to die of something and extending life for the sake of it has to be questioned. The medical profession and drug treatment payers have always had to grapple with this issue and the search for treatments for chronic diseases, rather than cures, predominates in Big Pharma psyche. It has been argued that 10 year iatrogenic deaths rates in the USA amount to 7.8 million people and costs around $282 billion annually2. This results in the loss of more American lives than in all the wars in which it have ever taken part. Medical and nursing professions, however, can only work with the tools that they have been given. The proliferation of off-license use of drugs is testament to the fact that, although significant advances have been achieved, we are

Patients appear to have an unrelenting demand for new treatments, not only for (potentially) life-threatening conditions but also for a growing plethora of life-style conditions – erectile dysfunction, mood elevators, sports performance enhancers and hair tonics. Drug payers are, understandably, anxious not to pay for these cosmetic products but how do clinicians separate physical and mental causes that might be at the root of this demand. Is this really a medical need? It is also perverse that we spend so much on the rehabilitation of individuals who have become hooked on self-abuse substances – alcohol and tobacco, for instance. Is it far too easy for individuals to pass responsibility for their own shortcomings to society? Should society pay for it? Government has tough choices. The solution to narcotics abuse is tackled in Canada mainly by policing and prosecution rather than by education and treatment. Is life so bad that people want to escape its realities through substance abuse? On the one hand we appear to want to live longer; on the other we indulge in lifeshortening activities. Notice that consumerorientated brand marketing driving the sale of erectile dysfunction drugs has resulted in a level of ‘me-too’ molecular roulette that the industry stated it was trying to avoid by its consolidation efforts! This activity was not cost-driven! As the search for new treatments shifts from drug companies, the process requires other types of investors, mainly starting with government. It would be fair to question whether government gets adequate return on its investment. Federal and provincial coffers are the first places that most researchNOVEMBER 2010 BIOTECHNOLOGY FOCUS 15

COMMERCIALIZATION ers look to fund their research. By pushing this highly risky investment to government the core industry should have become significantly more profitable since they have removed the greatest element of product failure. Many government agencies have become very skilled at recognizing winners amongst their massive number of requests. They, however, are not experts in every facet of healthcare technology. Research is a passion, not just a discipline. That’s why Big Pharma has finally woken up to the fact that you cannot dial-up a blockbuster just by throwing money at a problem. The next question may be emotive to readers of this article but does government have enough say in how their money is spent? Do they get their just rewards from their investment? Should they share in the eventual transfer of the technology according to the level of their investment? Do they add sufficient value to the equation to justify a share in such success? Indeed, the same question can be asked of the venture capital community. Many researchers perceive that these parties add additional tiers of administration and reportage but interfere with their creativity and flair, but it is not their money at risk!

The technology transfer dilemma

Interestingly, in over 35 years of technology transfer, most inventions are still not patented and do not generate an income. By industry standards only one in 200 is commercially successful3.

The nearest we get to understanding the worthiness of new technologies might actually be the universities themselves. The offices of technology transfer are key agents in value transmission. University hospitals are similarly essential as testing grounds for new technologies but, interestingly, there is strong competition for Key Opinion Leader engagement. Big Pharma excels in tying up KOLs in clinical work that fits their existing paradigms rather than serving research that might challenge the status quo. Money talks! Since government is both funding agent for research and payer for healthcare services, there appears to be a good argument for agencies working together to seek alternative solutions that might show benefit in terms of outcome, cost and overall financial return. Return on investment, naturally, is linked to levels of risk. In the early stages it is actually government that is least risk-averse. That is we tax-payers! Do we get a satisfactory return on such investment? We can certainly expect greater longevity and an arguably better quality of life (when we are not abusing it). How much of this, however, is a direct result

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COMMERCIALIZATION of improved sanitation, water and food quality, environmental controls, relative absence of war and implementing health and safety procedures at work? Interestingly, in over 35 years of technology transfer, most inventions are still not patented and do not generate an income. By industry standards only one in 200 is commercially successful3.

At the end of the day who is really making money? In summary, we would ask “how many successful researchers achieve the same level of return for their efforts as drug industry executives?”. Are these managers merely investment portfolio managers? How much real value is lost by hedging and risk spreading across product portfolios rather than singularly pursuing the best interests of viable technologies? Should individual investors be allowed to choose the level of risk and return that is right for them, or are they happy with that such decisions are denied them by the drug industry? There has been a general movement away from ‘diverse multinational’ companies towards focusing upon primary competences. Is there an argument, therefore, for the pharmaceutical industry to de-merge into smaller companies

to leverage specific technologies, healthcare providers, diseases or patient types? Could we end up with, say, a few hundred more closely targeted companies that seek to satisfy the needs of their customers rather than their own longevity? Is this too much to ask? Probably! After all, vested self-interest has always been a strong business driver and fits the short-termism of financial markets. It could be postulated that Big Biotech will replace Big Pharma but their ownership and paradigms are so intertwined that it is currently difficult to separate them. Paradoxically, the protection of the status quo brings sub-optimal results for investors, patients, payers and providers. It is only the power of the investors (individual, institutional, pension funds) that can change this paradigm. Investing in focused biotechnologies would appear to be an answer. If investments do not give the returns, change WILL eventually happen. If the industry sticks to its existing paradigms then these two “potential” cynics will not be too surprised at the outcome!

References 1. http://en.wikipedia.org/wiki/List_of_ pharmaceutical_companies 2. http://www.ourcivilisation.com/

medicine/usamed/deaths.htm 3. The governance of university : a critical review of the literature. Aldo Geuna, Allessandro Muscio. (ed). Springer Science+Business Media B.V. 2009, Minerva, Vol. 47, pp 93-114. Pierre Bourassa, B.Sc. MBA is a former entrepreneur who has worked more than 10 years with the NRC-IRAP program. He is currently under secondment to the NSERC, managing the Québec Montreal office. You can reach him at pierre. bourassa@nserc-crsng.gc.ca John Lawson, DBA, MBA, BPharm is a business consultant with Tri:M-V Inc., a member of the BioStrategis consortium. He often assists innovative companies during their early stages of development. He can be contacted on john@ biostrategis.com.

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Reply Card #4801 NOVEMBER 2010 BIOTECHNOLOGY FOCUS 17

By Tim Bryant

INNOVATOR

NEURAXON INC. offering more than just pain relief

t’s a given a biotech company needs money to get off the ground and be successful. What isn’t a given is how much is needed to make that happen. In the case of Toronto-based NeurAxon Inc., it is abundantly clear the lack of a multi-billion dollar research budget has not hindered its success. In 2004, NeurAxon was established as on outlet for intellectual property developed by Suman Rakhit’s contract research organization, MCR Research Inc. He took this opportunity to free himself from the constraints of working for someone else. “Although we were going to make money being a CRO, we had to work for other companies on projects of their choosing,” he says. “We felt that we should devote some time to do our own research that would be stimulating for our young chemists.” But bringing NeurAxon to life was anything but a solo effort. Lending a hand were colleagues Shawn Maddaford, now NeurAxon’s vice president of discovery chemistry, and John Andrews, now the company’s chief scientific officer. Maddaford and Rakhit already had a history working together, having co-founded MCR Research in 1999. Andrews gained his foothold as a consultant to one of the venture capital firms that provided funding to get NeurAxon off the ground. Asked to review their proposal on nitric oxide synthase, Andrews was initially skeptical, aware of many previous failures to make a drug addressing this target. The fact he had spent much of his life working in central nervous system drug discovery in both big and small pharma didn’t hurt either.

18 BIOTECHNOLOGY FOCUS NOVEMBER 2010

INNOVATOR “So the three of us started the company with a modest amount of VC capital, and slowly we developed compounds that were quite interesting.” That reasonable amount of VC capital has grown to $55 million since 2004, says Rakhit and after two years they had their first product development candidate. “And I would say that I am very proud of the people here, the way we handle our finances and the projects.” NEURAXON HAS MANAGED ITS MONEY so well that in the six years it has been up and running, it has managed to complete five phase one trials, one phase IIa trial and two phase two trials on NXN-188, its lead drug candidate for the treatment of migraine. A third phase II trial is also ongoing. In addition, a phase one trial has been started on NXN-462, a product candidate for the treatment of neuropathic pain. “We don’t have a gorgeous laboratory space where we have our own carpet monogrammed with NeurAxon,” Rakhit says. “We spend most of our money on R&D.” The choice to spend the money primarily on the R&D has had a significant impact on NeurAxon’s success, as having two internally-developed drug candidates undergoing clinical trials within six years will attest. It is something Rakhit views as nearly unprecedented in the biotech world, as he has never seen a company start trials on two different drug candidates and keep the R&D department intact with only $55 million in capital, more than $20 million of which was still on the company’s balance sheet at the beginning of this year. But he is not resting on his laurels. “We would like to raise more money, of course, but we can still execute on our business model independently with our current cash for another two years in these tough economic times. You can see how we organize our finances - it is a story of success built on survival.” But what else is so special about NeurAxon that has created the success it’s had with such a lean budget? Rakhit believes it comes down to a single philosophy: communication to support the mission of doing groundbreaking science. “Everything that happens in the discovery and development process we communicate it to our people,” he says. THERE IS A FREE FLOW OF IDEAS and information amongst the employees and management. If everything is going well,

Photo provided by NeurAxon

the news will find its way from the lab to the executive offices and vice versa. When the company encounters challenges as often happens when trying to innovate a new class of drugs, meetings are often held to discuss why that is so and what can be done to fix the situation. “We don’t believe in keeping problems or ideas secret in science,” says Rakhit. “It doesn’t work that way because we believe very strongly that the path of developing a drug is not very straight forward. Problems only stay problems when they are not communicated. With communication, they become challenges to solve and overcome.” Rakhit says this philosophy is critical to NeurAxon’s success. Without constant discussion and re-evaluation, it would be very difficult to solve any problems that arise in the process. This is where communication becomes key to solving problems, and drug discovery and development is all about problem solving. “To be able to solve problems, we have to understand the problems,” he says. In a way, Rakhit’s work with NeurAxon is the culmination of a life in drug discovery and development. Despite having already been retired when he started MCR Research in 1999, he still enjoys the daily challenges of problem solving. Rakhit, along with the rest of the management has a long history of drug discovery. Holding a PhD in pharmaceutical chemistry, his career started at Montreal’s Ayerst

Research Laboratories in 1965. While there, he helped discover the anti-rejection drug, Rapamycin. After 18 years with Ayerst, Rakhit moved to Laval, QC, where he was involved in the creation of BioMega Inc., which was eventually taken over by Boehringer Ingelheim. In 1992 he moved again, this time down Hwy. 401 to Mississauga, ON, and Allelix Biopharmaceuticals. “Allelix didn’t have any medicinal chemistry, so I came to start the medicinal chemistry department with four people,” he says. “It grew and we had several interesting research projects.” He stayed at Allelix until 1998, when he retired. But the retirement didn’t last too long, as he became edgy and leapt at the chance to start MCR Research the very next year. Five years later, NeurAxon was born. Since that time, Rakhit and NeurAxon have focused primarily on pain therapeutics based on their understanding of nitric oxide synthase inhibition. But that choice has been fraught with challenges. THERE ARE THREE FORMS of nitric oxide synthase in the body, with each one serving a different purpose. One is present in the central and peripheral nervous systems (nNOS). The second is found in the blood vessels (eNOS). A third is broadly distributed around the human body and is induced as part of the immune and inflammatory system response (iNOS). All three are needed for NOVEMBER 2010 BIOTECHNOLOGY FOCUS 19

INNOVATOR

The end goal is to partially inhibit or control the enzyme that produces the nitric oxide, in turn reducing the damage caused by excessive nitric oxide and alleviating the Parkinson’s conditions. the human body to remain healthy, Rakhit says. But in certain conditions, the neuronal form is overproduced, which can lower the threshold for perceiving pain. While it may seem straightforward to develop a drug to control the overproduction of nNOS, Rakhit says it’s not that simple. “The problem is these are three related forms, or isoforms, of the enzymes. They are very close to each other in their structure, and in the past there has been a chemistry challenge to come up with any new chemical structure that will affect only the neuronal form without affecting the form that exists in the cardiovascular system.” This is critical, because if eNOS is inhibited, the patient’s blood pressure will increase, Rakhit says, resulting in increase cardiovascular risks, including stroke. “So we thought, oh, that’s an interesting challenge. We have done that in our past lives. We all came from drug discovery, where that was a common challenge,” he says. “We said, OK, let’s do it. And we were able to achieve what we were looking for. We have now a series of compounds that are selective for nNOS over eNOS.” If inhibiting the nNOS enzyme only wasn’t challenging enough, the company took things a step further by intentionally designing their nNOS inhibitors to bind to other targets relevant to pain. For instance, in addition to nitric oxide, serotonin is important in migraines. The triptan anti-migraine drugs on the market (e.g. Imitrex) work through the serotonin mechanism (5HT1D/1B receptors). While they are the current gold standard of care, these drugs are far from perfect. 30 per cent of patients fail to respond and many suffer from rebound headache. The timing of when you take these medications is crucial for successful headache therapy. Take them too early during the so called “aura phase” of a migraine attack and they don’t work. Wait too long, and again triptans are mostly ineffective, especially once cutaneous allodynia, or hypersensitivity to pain, has set in. About 70 per cent of migraineurs will develop tactile or cutaneous allodynia where a light 20 BIOTECHNOLOGY FOCUS NOVEMBER 2010

Nitric oxide

touch now becomes painful; even combing your hair can be excruciating. Nitric oxide appears to be an important modulator of pain signals and interacts with many neurotransmitter systems “We felt that having both mechanisms of action in a single drug would potentially treat non-responders and expand the window of intervention.” THE COMPANY HAS A STRONG FOCUS on dual action drugs or Designed Multiple Ligands, but at the time of NeurAxon’s founding in 2004, there were only seven prior examples of dual action by design small molecules drugs or NCEs in the history of rational drug design, and now the company has increased that number by more than 50 per cent while integrating them with first-inclass selective nNOS inhibitors. It intends to apply its nNOS technology to design other pain therapies such as dual acting nNOSopioid analgesics which the company has trademarked NOpioid™ or NOpiate™. One of the issues related to the use of opioids for pain management is the development of tolerance. Nitric oxide is known to reduce the effectiveness morphine-like pain medications and inhibiting it appears to reduce tolerance and the dosage required for analgesia. This success in the pain therapeutics realm has given NeurAxon confidence to attempt to branch out into other therapeutic areas. As such, the company applied for and received a $267,000 grant from the Michael J. Fox Foundation in January 2010. Rakhit says the

money will be used to develop a proof of concept for a way to reduce the effects of Parkinson’s disease, which has been linked to an overproduction of nitric oxide. Nitric oxide can react with free radical oxygen in the body, producing peroxinitrite, which ultimately does most of the damage by attacking the proteins, lipids and DNA in the body. Once that starts, it continues to cascade, causing neural degeneration. “Nitric oxide is a double-edged sword,” Rakhit says. “If you don’t have enough, then it’s not very good. If you have too much, or in the wrong places, then it’s bad.” THE END GOAL IS to partially inhibit or control the enzyme that produces the nitric oxide, in turn reducing the damage caused by excessive nitric oxide and alleviating the Parkinson’s conditions. Rakhit also says NeurAxon is leveraging the Michael J. Fox grant to jumpstart an expansion in the work the company does. “So we felt that we cannot diversify our products into other indications other than pain because it takes a lot of money and we will get defocused,” he says. The grant gives the company the opportunity to diversify its work without jeopardizing its core mission in pain. This plays directly into the thinking around the company that NeurAxon could be more than simply a pain therapeutics company. In NeurAxon’s six short years, and with a relatively limited budget, Rakhit and his team has done what is very difficult to do, establish a pipeline that continues to produce new drug candidates. This commitment to performance virtually guarantees that the remainder of NeurAxon’s first decade will be just as exciting, scientifically and financially.

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By Shawn Lawrence

ACROSS CANADA

Genome Canada gets a new general FORMER GENOME BC CHIEF SCIENTIFIC OFFICER TO HEAD GENOME CANADA It’s hard to believe that ten years have passed since the development of genomics as a significant science led the government of Canada to set up Genome Canada. In its existence, the organization has proven quite successful in developing and implementing a national strategy that supports large-scale genomics and proteomics research projects in this country. Now, as the organization prepares for the next chapter of its existence, it will do so with a new figure running the show. On October 18, following an intensive international executive search, Genome Canada named Dr. Pierre Meulien as the permanent successor to Genome Canada’s founding president and CEO, Martin Godbout. Dr. Meulien is no stranger to the industry and to its inner workings. Having served as chief science officer of Genome BC since 2007, he is already a champion of genomics research in Canada. He also has a strong commitment and passion for advancing the nation’s science and technology agenda and his skill as an accomplished facilitator who has managed expert research teams with a number of organizations, including Aventis Pasteur in Toronto (Senior Vice President of R&D), and in Lyon, France (Director of Research) are among his key strengths. “Genome Canada’s board of directors was unanimous in its selection” said Dr. C Thomas Caskey. “Dr. Meulien brings a wealth of experience in the areas of genomics, proteomics and bioinformatics within 22 BIOTECHNOLOGY FOCUS NOVEMBER 2010

the larger realm of biotechnology and life sciences. His strong commitment and passion for advancing the nation’s science and technology agenda will serve us well.” It’s an opportunity that Dr. Meulien feels well suited for and eager to tackle. “I’m familiar with the genomics field in Canada, the way Genome Canada and the Centres are set up, and the projects that are already underway. The new Genome Canada position gives me an opportunity to really shape a national genomic strategy for Canada, to keep Canada at the forefront,” he said. While leaving his role at Genome BC does bring some mixed feelings, the opportunity to be part of Canada’s national organization for genomics and to impact the decisions being made on a national lever are reasons he couldn’t refuse the position. “No matter how you cut it, Genome Canada has done an amazing job over the first ten years of its existence in leveraging federal

funding and building huge capacity in genomics across the country. The organization has really helped put Canada on the map as a place to do genomics research and development. The excellence of the things that Canada has done in this ever changing field, the huge international recognition across all the sectors, but there is still great potential for applications in this area to expand and inall the sectors of the life sciences.” Dr. Meulien states that he will review how Genome Canada spends its research dollars and whether any changes should be made to its current spending. Genome funding is currently targeted for a wide variety of areas deemed important to Canada’s future economic growth including agriculture, forestry, environment research, fisheries and human health. “Genomes are genomes, whether you’re looking at human beings, bugs in mining sites, crops, trees, fish or whatever. That’s what drives me, the potential to work with

ACROSS CANADA

The new Genome Canada position gives me an opportunity to really shape a national genomic strategy for Canada, to keep Canada at the forefront. — Dr. Pierre Meulien

the provincial centres, really engaging with what we would call end-users, whether they’re in industry or with people who are managing forests and fisheries or looking at the agricultural crops that we’re planting in our huge country. Genomics has a role to play in so many areas.” Of these areas, genomics has become a buzz word of late in human health, specifically for its potential to have significant impact in area of personalized medicine. “In Genome BC, we launched a personalized medicine program and other province’s like Quebec and Ontario the country have already recognized the immediate need for advancements in this field. So my plan for Genome Canada includes supporting such initiatives.” The key to making such initiatives work though, he explains, is convincing the decision makers, specifically the end users of the technology of the benefits of incorporating genomic technologies. “Convincing them can be challenging because when you talk to health authorities or Ministries of health who are struggling

with multi-billion dollar budgets trying to sustain cost and so on, often they can’t see the possibilities of using these technologies. They see only the cost as an add-on to their existing budgets. We (Genome Canada) along with the genome centres need to be better advocates in demonstrating that these technologies can be used in the healthcare system in an economically sustainable model, and in some instances as a means to reduce cost.” Dr. Meulien adds that his plans for the organization will also require changes in the way Genome Canada develops its programs and in choosing which projects to fund. “I’d like to involve multi-disciplinary teams across the health sector and bring the health economists and so on to the table, moreover the engagement of end-user communities across all sectors to ensure projects that we choose to support will demonstrate a value add yet fulfill the sustainability aspect.” In terms of funding, Meulien would not only like to build on the investments of $915 million to date from the Government of Canada, but also to work with other national organizations such as the Canada Foundation for Innovation, CIHR, NSERC and others. At the same time, he’d also like to bring Genome Canada closer to its provincial partners. “We need to be working together to facilitate projects and to improve the infrastructure to share cost and create an environment conducive to maintaining excellence in the field. Only by building these partnerships can Canada truly take full advantage of this huge technology revolution that is happening inside the life sciences.” Creating international collaborations can be just as important as creating national ones adds Dr. Meulien. While at Genome BC, Dr Meulien was responsible for developing an international strategy that resulted in partnerships with the European Union, Chile, Australia, and Norway. He also spearheaded an international consortium to sequence the Atlantic salmon genome, which will lead to better management of wild fish stocks and breeding selection for commercially important traits. “So you can say I have a lot of experience with international funders and partners. Obviously, Canada is still a relatively small country in terms of population, and in order to try and be among the best in this growing field, Genome Canada needs to partner with others and go forward with a collaborative type of thinking. We can’t just think domestically, we also have to think internationally.” Moreover, Dr. Meulien says he would like

to see the percentage of Genome Canada funds from industry, which currently sits just under ten per cent, doubled over the next few years. Likewise, giving industry more of a say in forging a strategic plan for Genome Canada over the next 10 years is also a priority. “The goal is to be more proactive in bringing stakeholder groups together, getting industry across all sectors not only to increase their support of Genome Canada projects but also to inform us of their needs so we can better decide what’s best on a projectby-project basis going forward,” Meulien said. “Our key challenge is to translate all of this fantastic stuff we’ve been doing over the last ten years into real world applications. As such, large scale research with translational objectives will be a major part of our mandate. In order to this correctly, this goes back to engaging with industry and other end users who are going to uses the technologies.” For this, he will rely on his industry background. Prior to Genome BC, Dr Meulien was the founding CEO of the Dublin Molecular Medicine Centre (now Molecular Medicine Ireland), and held leadership roles with a number of other companies around the world. “I have a lot of experience in that area, almost 20 years in both pharma and biotechnology sector. I’d like to see industry get more involved because by working with end-users, we improve the utility and application of genomics technologies and enhance industry uptake across all economic sectors important to Canada.” Genome Canada’s track record of funding large-scale research will remain in tact under Meulien’s watch. In fact, not only will largescale research continue, it will happen more often says Dr. Meulien. Last but not least, Meulien recognizes the importance of getting the message out there to the public, that genomics has great potential. “Genome Canada has been very strong in societal aspects of genomics and in order to get these technologies into society and in an acceptable form. We need to continue this trend, engaging our major communities and the public in large so that they see the promise of genomics for all Canadians.”

For more INNOVATORS visit our PROFILES Web Portal at www.bioscienceworld.ca

NOVEMBER 2010 BIOTECHNOLOGY FOCUS 23

NEW PRODUCTS OXYGEN METER Omega’s new DOB21 is a compact benchtop dissolved oxygen meter and an amperometric dissolved oxygen probe with automatic temperature compensation for field or laboratory applications. It features a RS232 output, auto calibration for all parameters, salinity and barometric pressure compensation, and data logging up to 99 points. Programming is conveniently done via a three button keypad and stored in the non-volatile memory. This product is ideal for testing biological samples, water and waste water, as well as aquariums.

Reply Card #4803 TISSUE PROCESSOR Thermo Fisher Scientific Inc. features the new STP 420ES tissue processor for use in high-volume pathology laboratories. The updated instrument features more robust hardware and ease-of-use, enabling the highthroughput processing of large volumes of tissue to meet the demands of today’s laboratories. The Thermo Scientific STP 420ES models are designed to accommodate the most demanding requirements of researchers and pathologists in the field of tissue processing and have become an essential part of the laboratory workflow. The latest STP 420ES has been updated to include more robust hardware to handle the increasing number of samples processed in modern laboratories. The instrument’s dual chambers allow it to perform

simultaneous or independent processing of up to 420 tissue cassettes, enabling higher throughput. In addition, ultimate fluid exchange is ensured by the innovative rotational movement of the main chamber. Rotational agitation is also up to seven-times more effective than conventional tidal agitation, eliminating the need for reprocessing.

Reply Card #4804 CONNECTOR SYSTEM Dolomite introduces the new Mitos In-line Connector System. This innovative connector provides a single, fast and reliable multiway connection, which offers extensive time savings when compared to traditional connections between individual pipes. In addition to being quick and easy to use, the Mitos In-line Connector provides inline sealing and highly accurate alignment between the tubes, enabling uninterrupted liquid flow. Available in three standard sizes 4-, 8- and 12-way, the Mitos In-line Connector operates over a wide temperature (-15 0C to 250 0C) and pressure range (up to 10bar), providing excellent chemical compatibility. Furthermore, a low dead volume reduces the risk of cross-contamination between fluid samples, thereby maintaining experimental integrity. The technology benefits a broad range of applications, including chemical and biological analysis, parallel microfluidic processing, providing multi-way fluidic connections between various laboratory equipment. In addition, it is compatible with a variety of polymeric tubes including PTFE, FEP and PEEK. Custom sizes and geometries are also available upon request.

Reply Card #4806 ARRAYS SABiosciences, a QIAGEN company, launches several new RT2 Profiler PCR Arrays for gene expression profiling in nephrotoxicity, hepatotoxicology, differentiation and embryonic stem cells markers as well as analysis of epigenetic modulators and enzymes. Covering more than 100 pathways, PCR arrays enable scientists to easily and accurately analyze the gene expression in research areas such as cancer, stem cells, biomarker discovery and immunology. The RT2 Profiler PCR Array provides gene expression data from the RNA within three hours and is composed of PCR Array plates, RT2 first strand kit, RT2 SYBR Green Master Mix and the free PCR Array data analysis software. The arrays, originally developed by SABiosciences, make expression profiling accessible for routine use in every lab with a real-time PCR instrument. The experiment is simple to perform and provides sensitive, reproducible, and reliable results to accurately profile multiple genes simultaneously. The RT2 Profiler PCR Arrays as well as all other products from SABiosciences are now directly available from QIAGEN and offer the most comprehensive portfolio for sample and assay technologies for pathway analysis. Reply Card #4807

Reply Card #4805 DATA LOGGER Omega’s new OM-CPPHTEMP2000 series is a battery powered, stand alone pH and temperature data logger with a large LCD display. This product logs data in real-time and features programmable engineering units, programmable start-time, and automatic temperature compensation. This CE marked data 24 BIOTECHNOLOGY FOCUS NOVEMBER 2010

logger offers NIST Traceable Calibration. The OM-CP-PHTEMP2000 works with Omega’s PHE-4200 series of pH probes. This product is ideal for measuring pH of storm water runoff or drainage.

CELL CULTURE InVitria announces the launch of ITSE Animal-Free, a recombinant and defined cell culture media supplement that provides the ingredients essential for high performance cell culture. ITSE Animal-Free provides a solution for maximizing performance in a consistent and animal-free system. Insulin and transferrin supplements are commonly used in cell culture to reduce the amount of serum, such as fetal bovine serum (FBS), required to optimize performance.

NEW PRODUCTS Until now, researchers used insulin and transferrin supplements that were derived from animal sources. With ITSE-AnimalFree, cell culture scientists have a new alternative that is completely animal-free and well defined because it incorporates recombinant insulin and transferrin.

Reply Card #4808 BUNSEN BURNER WLD-TEC introduces its Flame 100 Safety Burner, the safe alternative for all traditional Bunsen or alcohol burner applications. The Flame 100 is ideally suited for all flame related applications in the laboratory. The 15 millimeter precision flame allows safe sterilization of microbiological instruments as well as graduated heating of dental tools. Flame size and intensity can be adjusted infinitely. The Flame 100 Burner activates immediately with the push of a button. No match or a pilot flame are required. Optionally, the Flame 100 can also be operated by a foot pedal or an external infrared motion sensor. The Flame 100 is suitable for stationary natural gas and propane/butane gas supplies as well as gas cartridges or gas cylinders. The proven Safety Control System (SCS) is also incorporated in the Flame 100. All potential hazards are constantly monitored and, if necessary, protective measures – such as the shutting off the gas supply – are activated.

increased ease of use and space savings. Taking advantage of new Windows* 7 capabilities, the touch screen minimizes the need for a separate keyboard and mouse. Users can customize their own graphical interface with windows that can be moved or scrolled through with finger movements. The monitor is fully supported by the Hamilton VENUS software. The new 19” Touch-Screen Monitor can be positioned at any angle up to approximately 135 degrees, mounted on the right side of the STAR instrument, and can be folded

out of the way when not in use.

Reply Card #4810

Reply Card #4809 ROBOTICS Hamilton Robotics introduces a Touch-Screen Monitor option for its MICROLAB STAR and STARlet liquid handling workstations, providing NOVEMBER 2010 BIOTECHNOLOGY FOCUS 25

CALENDAR

NOVEMBER 2010 November 8-10 HealthAchieve Toronto, ON Tel: (416) 205-1300 Fax (416) 205-1301 Email: info@oha.com Web: www.oha.com

November 15 Botanical drug discovery: Breakthroughs in polymolecular therapeutics Venue: MaRS Centre, Toronto, ON Web: http://botanicaldrugdiscovery. eventbrite.com/

November 15-17 Influenza Congress USA 2010 Washington, DC, USA Tel: 212-379-6322 Fax 212-379-6319 Email: enquiry.us@terrapinn.com Web: www.terrapinn.com

November 16-17 9th Annual Market Access Summit Venue: Four Points Toronto Airport, Toronto, ON Contact: Jennifer Mirara (ext. 253) Tel: 1-866-298-9343 Fax: 1-866-298-9344 Email: mirara@strategyinstitute.com Web: www.marketaccess.ca

November 22-23 The Inaugural Tech Transfer Summit North America Toronto, Canada Web: www.techtransfersummit.com

COMPANY

November 25

Agricultural Biotechnology..........................................................

Toronto Pub Night Toronto, ON Web: www.ontbi.org

International Conference......................... 7.................................. Alberta Research Council......................... 6.................................. Allist Pharmaceuticals Inc........................ 8..................................

BioPartnering North America....................21............................4802

9th Canadian Immunization Conference Quebec City, QC Tel: (613) 941-8189 Fax: (613) 998-6413 Email: immunconf@phac-aspc.gc.ca Web: www.phac-aspc.gc.ca/cnic-ccni/ index.html

BioTalent Canada.........................................13............................4799

December 5-7

Eppendorf.................................................... 32............................ 4812

BioPartnering China Venue: Renaissance Shanghai Pudong Hotel, Shanghai, China Web: www.techvision.com/bpc

Fisher Scientific............................................ 2.............................4795

December 9-10 FDA/CMS Summit JW Marriott, Washington, DC Web: http://www.windhover.com/ windhover/content/conferences/ fda-cms.aspx

Pacific Rim Summit on Industrial Biotechnology and Bioenergy Venue: Honolulu, Hawaii, USA Email: pacrim@bio.org Web: www.bio.org/pacrim

TBI/LSO Networking Breakfast Toronto, ON Web: www.ontbi.org

Afexa Life Sciences Inc............................. 8..................................

December 5-8

Stem Cells USA & Regenerative Medicine Congress 2010 Washington, DC, USA Tel: (212) 379-6322 Fax: (212) 379-6319 Email: enquiry.us@terrapinn.com Web: www.terrapinn.com

November 18

Amorfix Life Sciences............................... 9..................................

December 11-14

MEDICA 2010 Dusseldorf, Germany Tel: (416) 598-1524 Fax: (416) 598-1840 Email: messeduesseldorf@ germanchamber.ca Web: www.messe-duesseldorf.de

PAGE

DECEMBER 2010

November 16-17

November 17-20

COMPANY & ADVERTISER INDEX

December 16 TBI/LSO December Networking Breakfast Toronto, ON Web: www.ontbi.org

Canadian Institutes of Health Research... 8.................................. Caprion Proteomics Inc.............................. 8...................................... Childrens Miracle Network .......................17............................ 4801 Dalhousie University...................................16............................4800 Dolomite................................................. 24........................ 4805

Genome British Columbia........................ 8.................................. Hamilton Robotics.................................. 25.........................4810 Health Canada......................................... 6.................................. Helix BioPharma Corp.............................. 6.................................. InVitria.................................................... 24........................ 4808 Life Sciences Ontario.................................7, 9..................4797, 4798 Lisoma Canada Ltd................................... 8.................................. Lorus Therapeutics Inc............................. 6.................................. Merck Frosst Canada Ltd.......................... 6.................................. Metrohm....................................................... 5.............................4796 Omega.................................................... 24.............. 4803, 4806 OncoGenex Pharmaceuticals................. 6, 8................................ POI..................................................................31............................ 4811 ProMetic Life Sciences............................. 8.................................. Queen’s University................................... 6.................................. SABiosciences......................................... 24........................ 4807 Stem Cell Therapeutics............................ 9..................................

JANUARY 2011

Teva Pharmaceuticals Industries Ltd. ...... 6..................................

January 10-12

Theratechnologies................................... 9..................................

Biotech Showcase 2011 San Francisco, USA Web: http://www.ebdgroup.com/ bts/index.php

Thermo Fisher Scientific Inc.................... 24........................ 4804 Trans-Hit Biomarkers............................... 8.................................. WLD-TEC................................................. 25........................ 4809 Women’s Health Research Institute......... 8.................................. YM BioSciences Inc................................... 9..................................

26 BIOTECHNOLOGY FOCUS NOVEMBER 2010

SPOTLIGHT

Compiled by Shawn Lawrence

TORONTO TO HOST INAUGURAL tech transfer summit

he inaugural Tech Transfer Summit North America is set to take place in Toronto November 22-23, marking the first time the event held previously in Europe and Russia, has come to North America. The brainchild of the Tech Transfer Summit organization (TTS Ltd.), the summit is being co-organized by Life Sciences Ontario, MaRS Innovation and others to foster talks and give attendees a venue to learn from some of the foremost practitioners of tech transfer worldwide. TTS Ltd. originally founded the Summit initiative on four core principals: Attract the most important representatives of technology transfer from across the entire region including technology transfer officers (TTOs), innovators and early stage entities alike, university and institute directors and chairmen, bioregion directors and local investors; actively involve senior industry licensing and business development executives, biotech CEO’s, leading IP lawyers and specialists, serial entrepreneurs and investors; limit total participation to ensure an exclusive, qualitative high-level meeting and provide an incredibly interactive, engaging atmosphere conducive to real networking, relationship building, and licensing; and the instigation of business development. For these reasons, former BIOTECanada president and current LSO consultant Janet Lambert believes the summit is a boon to Ontario. “The summit will bring together international experts and executives from industry, finance and IP in sourcing the best technology from across the globe making this a great opportunity to see what can be done to improve Ontario’s track record as a key region in tech transfer, to talk about where our priorities and innovation opportunities are,” says Lambert. She adds that having the opportunity to work on an event like this with TTS Ltd., an organization that has built its own strong relationships and expertise in the area of tech transfer, should prove beneficial to all involved. Likewise, LSO president and CEO Lorne Meikle believes it is a must-attend event for all early stage SME, biotech, pharma and related sector licensing and technology executives and managers. “We’ve been trying to get a world type tech transfer event here in Toronto for a number of years now. There is no technology summit like this in North America. Events like these are needed in the industry, they’re typically well attended and they’re good for the companies.This event is good for Life Sciences Ontario, good for the industry in Toronto and good for Canada,” he said. In addition to tech transfer officers, senior innovation and research directors from leading research universities, institutes, science parks and bioregions will also be in attendance. “Industry participants are provided direct access to senior technology managers and tech transfer officers. It’s a chance for collaboration, partnering and licensing, particularly a welcome opportunity in light of the current economic climate. Companies today are already

looking for options to survive, such as licensing and raising money. With this event we’re putting them face to face with the people making the licensing decisions, people making the financial decisions, and most importantly people who are doing international deals. It’s about giving attendees an opportunity to see what the world perspective is on the industry on top of the Canadian perspective.” The event is also designed to allow the participants and speakers a chance to network and have discussions. “Good business develops first and foremost through building a good relationship. The summit brings together a high-class field of both speakers and delegates alike, placing them in surroundings that allow for relaxed discourse. Many of the speakers are in most cases people who would never speak here. We’re fortunate to have these world class speakers here. What develops from the networking will depend on the people who are attending the event,” Lorne explains. The event has generated a lot of positive feedback already with confirmed attendance by top industry executives, financial experts, as well as leading academic research universities and institutes. Topics for the two-day even include: best practices in world-class technology transfer, a discussion on the main challenges and opportunities in technology transfer, licensing and IP protocols across international borders, IP strategy and defining proof-of-concept, how to work with industry and licensing projects from big pharma. The keynote speaker is Mark Rohrbaugh, NIH director, office of Technology Transfer. Participation in the Summit is strictly limited to 250 attendees and requires registration through the online registration site. Visit http// www.techtransfersummit.com for more information.

For more TO MARKET information visit our COMMERCIALIZATION Web Portal at www.bioscienceworld.ca

NOVEMBER 2010 BIOTECHNOLOGY FOCUS 27

THE LAST WORD

By Robert Foldes

Biotech Entrepreneurship, Start-Ups and

HOLLYWOOD I

Robert Foldes is Managing Partner of Mentis Partners Inc. and can be contacted at robert@ mentispartners.com.

recently saw the movie Extreme Measures starring Brendan Fraser and Harrison Ford. The movie was released earlier this year but like many of you, I stayed away initially, daunted by the usual negative Hollywood stereotype of scientists and/or the pharma/ biotech industry (eg. The Constant Gardener, Deep Blue Sea, etc.). Extreme Measures was inspired by the true story of the development of a treatment for Pompé Disease. Key players in this movie were based on John Crowley (current CEO of Amicus Pharmaceuticals), Dr. William Canfield, their start-up company Novazyme, and Genzyme (the acquirer). My reasons for watching the movie were not inspired – it was free and there was nothing else on. I had some trepidation but the movie was not as bad as I feared. Don’t get me wrong – I still don’t understand why Hollywood screenwriters can’t access better advisors to help with more accurate content and dialogue. One scene involving the acquisition negotiation was particularly bizarre. Nevertheless, there were some portrayals (and lessons) that were reasonable (given the

28 BIOTECHNOLOGY FOCUS NOVEMBER 2010

limitations of a two hour movie). This motivated me to extrapolate and offer my thoughts on current realities facing biotech entrepreneurship and start-ups. Entrepreneurship in biotechnology frequently results from the partnership between at least one scientist and at least one businessperson. The recipe for success includes a well-published scientist associated with a leading research institution and contributing to solid intellectual property. Ideally the businessperson has significant industry and capital-raising experience. Both are equally important during the start-up phase and each role will evolve over time. When risk capital is scarce, the bar on the founders’ credentials and track-record is inevitably raised. Contributions of university technology transfer offices (TTO) are less clear. Essentially this was absent in the movie and the university was generally negatively portrayed as not supporting and not appreciating the work of the scientist. Is real life much different? I have watched TTO’s evolve over the last 15 years and can of-

THE LAST WORD fer some generalizations and perhaps some suggestions. Some TTO’s are more entrepreneur-friendly than others. Not surprisingly, this may be inversely-correlated to their internal resources. Many TTO’s are bureaucratic and process-oriented and more focused on avoiding liabilities rather than assuming risk and promoting commercialization. The latter two are usually linked. Much of the TTO culture is derived from the background and mandate of the university’s vice president of Research (generally a sub-optimal reporting structure). The “centralization” versus “decentralization” argument amongst stakeholders in commercializing academic research is moot. The key issue is one of leveraging internal and external resources to offer outstanding service to inventors, entrepreneurs and industry with a sense of urgency. The “one-stop-shop” rationale used by centralized TTO advocates is also off-target. Any company that has an active in-licensing program has dedicated experts finding

Extreme Measures portrayal of venture capitalists was close to realistic, focusing on hurdles rather than opportunities and being quick to bail, rather than a long term supporter of corporate growth. technologies. World-wide patent or licensing opportunity databases are the real “one-stop-shops.” From local research institutions, industry mostly seeks timeliness and involvement of key decision makers in negotiations. Adding more layers to obscure decision makers and lengthening negotiations does not facilitate commercialization. The most important role of the TTO by far is to ensure the broadest protection of the university’s intellectual property. This does include education to ensure that public disclosure does not jeopardize this mandate. Unfortunately, most TTOs that I know do not have sufficient resources to deliver on this mandate and therefore their role is compromised (also discussed by Robert Ford et al. in the September issue of Biotechnology Focus). Yet, universities need to recognize that they have an important role to play in local economic development. Rather than abandoning patents due to lack of resources, one approach would be to rapidly assemble an entrepreneurial team to ensure that proper financing, partnerships and development resources are secured to protect and advance the innovation. A properly structured entrepreneurin-residence program is consistent with this approach. Some universities (eg. University of Saskatchewan) have recently announced such programs, however, current implementation is by no means ubiquitous or optimal. When risk capital is scarce, the required support from universities and their TTO’s is greater. The alternative involves a drying up of start-up companies and potential

30 BIOTECHNOLOGY FOCUS NOVEMBER 2010

licensees, a gap in product innovation pipelines, reduced return on government investment in academic research and diminished incentives for academic researchers to participate in the commercialization ecosystem. Early-stage risk capital is mostly addressed by the entrepreneurs themselves (and their networks), angel investors and venture capital (VC). Extreme Measures portrayal of venture capitalists was close to realistic, focusing on hurdles rather than opportunities and being quick to bail, rather than a long term supporter of corporate growth. Nevertheless for any company that will require tens of millions of dollars for product development that will take more than two to three years to generate revenues, access to venture capital is critical. I have identified approximately 115 VCs in Canada, the U.S. and Europe that may consider start-up life science company investments. I would estimate that there were 25 per cent more of these VCs some 5-10 years ago. Of the 12 such VCs headquartered in Canada, only five invest inside their province. The deficiency in VC in Canada is not so much a result of the number of potential investors but more attributable to the amount of capital that is targeted to early stage life science opportunities. In Ontario there is one small dedicated fund managing some $36 million and investing across multiple sectors. In comparison, Nova Scotia, with 1/6 the population of Ontario has dedicated more than $61 million to invest in local companies. I am not aware of a single Canadian biotech CEO that feels that they can build a sustainable company without accessing foreign capital. In many cases, access to foreign VC involves relocation. This continues to have dire consequences for the Canadian economy and can only be reversed by large and sustained investment at all stages of a biotech company lifecycle (including proper resourcing of TTOs). Simply not enough is being done (still). From the Canadian biotech entrepreneur’s viewpoint, an international financing strategy is now de rigueur. Older paradigms that required local VCs to lead a financing round are no longer rules. In fact, many international VCs prefer to lead the financing round and assemble their own investor syndicate. In some cases, pre-existing investors (especially those that are not able to follow-on) become an obstacle to attracting international VCs. The key message is that, as in chess, the entrepreneur needs to balance the end game with the first move. Getting the right advice and strategic support is critical. Novazyme was founded in 1999 and acquired by Genzyme in 2001 for shares worth $137.5 million. The founders went on to pursue other entrepreneurial ventures. Amplified by hundreds of similar stories in the U.S., this example is representative of an effective biotech ecosystem.

Got something to say? Please send your comments/letters to biotechnology_focus@promotive.net

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Biotechnology Focus November 2010

Articles inside

THE INAUGURAL TECH TRANSFER SUMMIT NORTH AMERICA