A one stop shop for drug development

québec The NeoMeD Institute:

A one stop shop for drug development

The news was very bad for the Québec life science industry in February, 2012, when global pharma giant AstraZeneca announced it was closing its research facility in Québec. The province was already facing huge job loss numbers in the sector as one-by-one, global biopharmaceutical giants were moving or scaling back their R&D operations in Québec. Who would have thought back then that the former AstraZeneca building in the Saint-Laurent technology park would ever see better days again. And yet, that is exactly what has happened over the past 18 months. Thanks to the launch of the NEOMED Institute, there is a research renaissance happening in Québec’s biopharmaceutical community.

Hailed as a new type of translational research centre, the NEOMED Institute is part of a major shift in philosophy for life sciences and drug development in Québec. This philosophy is one that stresses the importance of public-private partnerships in facilitating early stage drug discovery. Backed by the Québec Government, Pfizer Canada, and of course AstraZeneca, the NEOMED Institute operates in two parts, firstly as an organization (NEOMED), and secondly on a larger scale, a building or institute that houses, today, 10 life science companies.

So how did two competing pharma companies come together with the Government of Québec on a common goal? For starters, the creation of the NEOMED Institute happened in large part thanks to two individuals: current President and CEO of NEOMED and the NEOMED Institute Dr. Max Fehlmann, and NEOMED’s CSO, Dr. Philippe Walker.

Fehlmann explains that the wheels were already in motion for an organization like NEOMED long before the AstraZeneca closing.

“We in the life science community were prepared to imagine something that could be the missing link in all the chain of players in the Biopharma ecosystem and when the opportunity of using AstraZeneca Research Centre arose, we were given the tool to address this missing link.”

Like Fehlmann, Walker also saw opportunity with the closing. Until June 2012, Walker was vice-president and head of the AstraZeneca R&D Montréal (AZRDM) research centre that delivered multiple drug candidates to the AstraZeneca portfolio.

“I had actually been recruited from Switzerland to Canada in 1994 to build the Montréal facility so I had a long history with the research facility. Moreover, I was also part of the global leadership team for AstraZeneca, so I was aware of the challenges that they and other pharma companies were facing, and understood their need to reduce their internal R&D activity. When I was told we were closing the site, it was not surprising, on the one hand I was very sad for the impact this was going to have on about 150 families, but knowing how valuable the facility itself was, I also saw an opportunity to use the facility in another way.”

Together, the two decided to work together to create something that could fill the void left by the big pharma’s exodus, but also something that could act as a catalyst for the local life science sector.

“Using the logic that pharma companies were saying we’re going to reduce the risk by acquiring outside R&D programs, there would need to be someone or something to fill a niche of advancing these R&D programs in smaller biotech companies to the stage they’d be acquired,” says Walker.

Filling such a niche was only part of the equation. As a member of the Fonds de Recherche du Québec, Walker also had the opportunity to see the great science and innovation underway in academic institutions in Canada, but also the huge challenges in transforming this great work into solid proposals for industry. He thought that perhaps

“I had a very strong relationship with Pfizer at CQDM and while there, we discussed a drug repositioning project using Pfizer assets that had been shelved and abandoned after unsuccessful

Phase 2 trials.” — Dr. Max Fehlmann

NEOMED could act as a bridge for transforming basic research into products worth investing in.

“The fact is there are very few academic groups who are able to bring a program forward to a stage where pharma is interested in investing. The mission of academia is different in a sense that they work on the basic science or in some instances the causes of disease. They understand the pathophysiology of the disease but very few are able to design compounds. So, the first week after we heard about the closure, I went to the Ministry of Finance of Québec and I presented this idea that we could create something in Québec to help bridge academia and deliver programs. They were quite taken with the notion that it was good for the science community, good for the economy and good for the life science sector in general.”

The Québec government was willing to contribute $28 million toward the project.

From there, Walker and Fehlmann began negotiations with AstraZeneca to convince them to back NEOMED and in the end, hand over the facility. The end result was AstraZeneca kicking in the research facility, the equipment along with $5 million in cash, as well as the intellectual property for three potential pain drugs. In all their contribution was valued at $35 million.

“I think what made it easy is that they knew that they had benefitted from a lot of support in Québec, and in Canada. They wanted to be a good citizen and leave in the right conditions, but at the same time they were quite eager when they saw how this could be a winwin proposal,” says Fehlmann.

Pfizer’s involvement in NEOMED is a slightly different story. Prior to joining NEOMED, Fehlmann was president and CEO of CQDM, the Québec Consortium for Drug Discovery, a pre-competitive drug discovery consortium formed by seven major pharmaceutical companies. One of those pharmaceutical companies happened to be AstraZeneca, another was Pfizer.

“I had a very strong relationship with Pfizer at CQDM and while there, we discussed a drug repositioning project using Pfizer assets that had been shelved and abandoned after unsuccessful Phase 2 trials. Our joint hope was to find new indications for those molecules and although such a project was out of the scope of CQDM, it was exactly the type of project we wanted for NEOMED. I proposed to Pfizer that we merge this project with NEOMED and they accepted.”

In all, Pfizer Canada provided a financial contribution of approximately $3.5 million and an agreement was reached giving NEOMED the rights to work with these shelved assets.

Of all these assets, the inherited projects from AstraZeneca are what have Walker most excited. For starters, he is perhaps the most knowledgeable person when it comes to these molecules having overseen their development while at AstraZeneca. The most advanced of the three is a Cannabinoid CB1/CB2- Agonist (NEO1940) that has already completed a number of Phase 1 trials at AstraZeneca.

“At AstraZeneca it was advanced as a pain medication for low back pain. Unfortunately when it was tested in volunteers, it was noticed that there was a dose-dependent weight gain provoked by the molecule, so AstraZeneca decided to shut it down. However, we felt we could reposition the molecule in an area that there is a tremendous need, specifically in Cachexia which is present in patients with cancer, COPD and heart failure problems, and so we asked them for the rights to this molecule and they complied.”

Walker believes that the molecule’s effects could be exploited in patients with Cachexia ensuring they don’t lose energy and muscle tissue.

“We are at the stage with this program where we can enter proofof-concept quickly and we are looking for co-investors to share the risk and reward on this.”

The second acquired program is NEO6860, a TRPV1 Antagonist. TRPV1 is a channel that exists on nerves and participates in the regulation of sensory neuron functioning and perception. According to Walker, many pharma companies have had TRPV1 antagonist

programs mostly for chronic pain. Many went into the clinic, but most failed, all for the same side effects.

“The problem was when you block this receptor you trigger deregulation of body temperature, elevation of temperatures and a failure to read temperatures. We have made some scientific discoveries since helping us avoid these side effects, and we have advanced the compound devoid of these side effects because it has a different pharmacology. This compound is at the GMP tox stage and if it goes through, we should have an IND application next year for Osteoarthritis pain.”

The third program Walker considers less advanced. It is for NEO5937 P2X3, an antagonist for bladder pain and other similar pains. NEOMED is currently gathering pre-clinical information to advance it forward.

Together these three programs form the core of its portfolio along with the drugs that NEOMED will repurpose from Pfizer. But there is another key strategical area that NEOMED wants to focus on. Specifically, identifying prospective projects in academia or small biotech enterprises and bringing them to a point where they are of value to be sold back to the biopharma industry.

“It is in this area that I think we have aligned ourselves very well with the new business model of the pharmaceutical industry. It’s well known that there is a considerable gap between basic research and later-stage drug development. With NEOMED we seek to cre-

“I truly believe NEOMED and the NEOMED Institute are a big plus both for Québec but for Canada as well. We’re creating an entity that has a good connection with academia, identifying great ideas.”

— Dr. Philippe Walker

ate a bridge, as well as a bridge between academic research and life sciences companies, essentially, the NEOMED model allows pharma companies to fund early stage startups, researchers and perhaps invest heavily in some biotechs until later-phase clinical trials can be considered.” says Fehlmann.

Already, NEOMED is in the process of reviewing new programs coming from young biotech and academia to add to its portfolio.

The process is very lean and effective says Fehlmann.

“Internally we have 15 experts at NEOMED, in all the major fields of drug discovery and they have all worked in industry. This is really our trademark. When we receive an application we can make a rapid evaluation on whether we want proceed with it. For the projects we select, we agree with the owners/investigators on a development plan, take control of the development and outsource all the work. Part of the work could be done at the university where the investigator comes from, or it could be CROs. We benefit from the flexibility of being virtual and the proximity of the CROs that we know very well in the area. The goal is to bring the projects to a pinnacle proof of concept (Phase 2a), and hopefully if all works well, we sell the projects to our pharma members. I think this is really our value in that we look at academic projects with the eyes that industry would look at them. This is what we are able to sell to the academic investigators, that we can help them to heighten their project and development of molecules in such a way that we can anticipate the regulatory problems, the preclinical/clinical requirements, and make the process of drug development easier.”

While selling more mature projects to pharma is the preferred exit strategy, NEOMED has also left the door open to the investor community, meaning company creation.

“This isn’t necessarily the first line of action with a new technology, but it is always a possibility. There are certain assets that we believe the industry will not take on easily or immediately because it may not be the type of indication that our partners like or for other reasons. In these instances there is potential to create companies and invite CoNtINueD oN PAGe 28