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Feature Articles : Jan 1, 2006 (Vol. 26, No. 1)

Biopartnering Crucial to Survival in Europe

Young Biotechs Seek Niche Innovations and Viable Partners to Stay Afloat
  • Susan Aldridge, Ph.D.

Ageneral consensus emerged during Technology Vision's 13th "BioPartnering Europe" conference, held in London recently, that the meeting was the ideal place for those seeking opportunities to build a biotech business.

One highlight was Bioforecaster 2005, where investors gave their views of the European scene. Mike Ward, senior editor of BioCentury, said that 2005 had not been a bad year in Europe, with its overall share of finance holding up. But it is still hard for European companies to raise money beyond the IPO stage, in comparison with U.S. companies.

"This has repercussions on European companies' ability to develop. They have to make the IPO money last longer," he said.

There have been 13 IPOs in Europe this year and the former British dominance seems to be slipping away. Meanwhile, VC money is going to fewer companies.

Antoine Papiernik of Sofinnova Partners said, "We have fantastic science in Europe, and we should be funding it." He predicts five to ten major preclinical deals between major pharma and European biotechs in the coming year.

Joe Anderson, Ph.D., of Abingworth Management, added, "This sector is on an upward curve long term. We will see pharma-biotech deals. It will be a much more volatile year going forwardinvestors will be looking for niches."

Up and Comers

The meeting saw a wide range of young, innovative biotechs offering technologies and products. MedPharm (www.medpharm.co.uk) operates a hybrid business model comprising contract services and its own development program in formulation and drug delivery, concentrating on topical (skin, nail, mucus membrane) and airway applications.

The company's sales have gone up 38% year on year since its founding in 1999, and its customers include everything from big pharma to small biotechs around the world, with an emphasis on dermatology companies.

"In the last 18 months we have focused on a group of projects such as MedNail, which gets product across the nail for fungal infections," explained CEO Andrew Muddle, Ph.D. "The dermatology market is a hot area to develop new products, and we are also looking for new dosages." The company is particularly interested in sprays and patches that can create thin films to enhance drug delivery in conditions like acne and eczema.

MedPharm has a joint venture with Optinose (www.optinose.no), a nasal drug delivery company. The company has also just extended its agreement with Peplin (www.peplin.com) on PEP005, a naturally occurring compound in clinical trials in a topical formulation for actinic keratosis and basal cell carcinoma. They will now develop an injectable version of PEP005 for the treatment of leukemia.

GenPat77 (www.genpat77.com) focuses on transplant immunology, inflammation, rheumatoid arthritis (RA), and multiple sclerosis (MS). They have carried out preclinical work with a novel target gene, TIRC 7, which is upregulated after the activation of lymphocytes within the first one to 24 hours. TIRC 7 has been licensed out to MedImmune (www.medimmune.com) for work in RA and MS in what was one of the biggest deals in Germany for a preclinical target.

GenPat77 also has preclinical programs with a number of other targets on exclusive license from Brigham and Women's Hospital.

GenPat 77's most advanced program involves fusion proteins and monoclonals against CEACAM1, a target that has reached the stage of proof of concept in colitis. The company received a grant of E400,000 from the German Federal Ministry of Education and Research, under the BioChancePLUS support program for small and medium-sized biotechs, to further develop its CEACAM1 project.

"We believe that therapies targeting CEACAM1 have potential to address several disorders such as inflammatory bowel disease, other autoimmune diseases, and cancer," noted CEO Naln Utku, M.D.

CovX (www.covx.com) is developing a range of novel biopharmaceutical products called CovX-Bodies that combine peptides and small molecules with antibodies, under an exclusive license on research from the Scripps Institute. "Our product focus is driven by the marriage of the therapeutic potential of peptides and the commercial potential of antibodies," said CSO Rodney Lappe.

"Peptides have great biology but their half life is short. Combining them with an antibody through our novel chemistries increases this half life. This allows therapies for targets that are inaccessible to small molecules."

The CovX-Bodies are created by attaching the peptide to a proprietary tether and then combining two tethered molecules with an antibody. The initial therapeutic focus is on oncology and metabolic disorders; the lead CovX product is an anti-angiogenic agent for lung cancer, where preclinical work has shown that it can produce 74% shrinkage of tumor volume and complete stasis of viable tumor volume.

The CovX-Bodies are produced at a high level from a contract manufacturer (one kilogram in the last six months), and the first clinical trial is expected to begin next year. The company intends to advance its own products as far as Phase II/proof of concept and will then partner. They will also apply the CovX approach to partners' molecules.

Skin and Hair Replacement

Intercytex (www.intercytex. com) is a cell therapy company using ordinary cells rather than stem cells, focusing on wound care and skin and hair replacement. Lead product ICX-PRO is a dressing containing human dermal fibroblasts in a human fibrin-based gel matrixa combination that can "kick start" the healing process, according to CEO Nick Higgins.

Phase II gave promising results in venous leg ulcers, with 85% of participants showing a reduction in wound size and 41% with smaller ulcers showing complete wound closure. ICX-PRO has now gone on to Phase III.

ICX-SKN is a skin replacement in preclinical development that consists of human dermal fibroblasts in a collagen matrix, overlaid by human keratinocytes and is intended for grafting onto chronic and acute wounds and burns. "We are further ahead in this than anyone else," Higgins says. "We can make skin that looks and feels like skin and can be sutured."

Finally, the hair replacement product, ICX-TRC is "the first example of organ generation," according to Higgins, and will address the huge and under-served market for treatment of hair loss in men and women. The therapy involves taking a biopsy from the patient's scalp and culturing the dermal papilla cells which, when transplanted, produce new hair. In Phase I, five out of seven patients showed new hair growth.

Integragen (www.integragen.com) is involved in genetic tests for complex diseases in the area of metabolism and neuropsychiatry. The company has a predisposition test, carried out in accredited labs, for autism based on four genes that can be used in the very young so that therapy can be started earlier.

"The genes involved in the test play a major role in brain development and will lead to better understanding and treatment of autism," said David Brady, vp, business development. The company is also interested in other neuropsychiatric conditions such as schizophrenia, bipolar disorder, and Alzheimer's disease, and is working with the National Institute for Mental Health tissue collection.

Integragen is also working on a test for MODY, a form of type 2 diabetes where early and accurate diagnosis is important, as the disease needs to be treated differently from other types of diabetes. In what would be a natural development of this work, the company intends adding diagnostics for other types of diabetes to its portfolio.

"The findings will advance our understanding of diabetes generallymaybe helping to find genes that predispose toward complications, such as retinopathy," said Brady.

Santhera (Liestal, Switzerland) was formed in 2004 as a merger between Graffinity and MyoContract and is focused on developing small molecule drugs, rather than gene therapies, for neuromuscular disease, working with only validated targets. The lead program involves a known drug, idebenone (SNT-MC17), which is about to enter Phase II in a collaboration with the NIH involving 48 patients who have Friedreich's ataxia, a rare and life-threatening disorder. A Phase III trial in Europe is planned for later this year.

The company also just announced a Phase IIa trial of SNT-MC17 in Duchenne muscular dystrophy. The drug is an antioxidant that supports mitochondrial function. It protects the muscle cells of the heart from oxidative stress, which otherwise leads to complications in these neuromuscular disorders and often proves fatal.

"What makes us unique is our use of a relevant animal model of neuromuscular diseases," said CSO Thomas Meier, Ph.D. The company has a preclinical pipeline that it will develop in neuromuscular disease and out-license in other therapeutic areas. It has licensed its program on novel DPP (dipeptidyl peptidase) IV inhibitors for metabolic disease to Biovitrum (www.biovitrum.com).

Oxford Biomedica (www. oxfordbiomedica.co.uk) is advancing its lead product, Trovax. "All patients in Phase II showed an immune response to the therapy, there were no safety issues, and 90 percent had disease control. The level of clinical benefit is superior to chemotherapy alone. What is specially significant is that the higher the immune response, the higher the clinical benefit," explained Nick Woolf, senior vp, corporate strategy. Phase III is due to start in 2006. The company recently outlined its plan for the trial in renal cell carcinoma with the FDA and is in discussion with a number of potential licensing partners. Trovax is potentially applicable to all kinds of solid tumors.

MetXia, the company's pro-drug therapy, is in Phase II in pancreatic cancer and has shown encouraging results. Meanwhile, positive preclinical data was recently presented on Oxford Biomedica's antibody conjugate therapy, targeted to the tumor antigen 5T4, which is found in most cancers. This program has been licensed out to Wyeth.

The rest of the pipeline includes a neurology program involving lentiviral delivery. "We will have three products in clinical trials in the next 12 months," said Woolf. Revenue is being generated by alliances such as that signed recently with Sigma Aldrich (www.sigmaaldrich.com) for the commercialization of Oxford Biomedica's LentiVector, a lentivirus-based gene delivery technology.

Therapeutic Antibodies

MorphoSys (www.morphosys.com) is involved in the development of a new generation of therapeutic and research antibodies based upon its HuCAL GOLD platform technology. The company, which became profitable last year, has several agreements with major pharmas and biotech where the technology is applied to the partner's targets. Recently it signed up with its first Japanese partner, Shionogi, and extended a deal begun in 2001 with Schering for three new antibody programs.

Ablynx (www.ablynx.com) is looking at the unusual immune system of camelidsllamas and camelswhich have antibodies with heavy chain as well as regular antibodies. The company has developed a product line called nanobodies that are single-chain proteins of 120 amino acids with full binding affinity and specificity.

Nanobodies are soluble, stable to proteases, and easy to handle. "We have shown that nanobodies are active against 16 human disease targets including cytokines, receptors, and enzymes," said Simon Kerry, Ph.D., director of business development. This has been shown by immunizing llamas with human TNF.

In its lead program, Ablynx is looking at von Willebrand factor, a protein that is involved in clotting in high-shear blood vessels after coronary surgery. Currently therapies like ReoPro are used in this context to decrease clotting but are linked with bleeding side effects. "We now have a lead, a humanized antibody from the llama, that has been very easy to prepare," said Dr. Kerry.

The nanobodies are made in bacteria or yeast with a cost estimate of $100 per patient per year. This is a plus given the high cost of existing antibody treatments. "This high cost means many people don't get the treatment they need. More could get first-line therapy in rheumatoid arthritis, which could blow away the competition," explained Dr. Kerry.

Indeed, Ablynx's second product is an anti-TNF nanobody for RA and the third an orally administered nanobody for inflammatory bowel disease. Nanobodies also have low immunogenic potential, maybe because they don't aggreggate. "The evidence is piling up that they will be excellent as therapeutics," concluded Dr. Kerry.

Finally, Avidex (www.avidex. com) is developing high-affinity monoclonal T cell receptors (mTCRs), which can target antigens that are intracellular but expressed on the surface of the cell in, for instance, type 1 diabetes.

Such antigens are not normally accessible to antibody therapies. "We are targeting the same epitopes as cytotoxic T cells," said Neill Moray MacKenzie, Ph.D., CBO. The company recently licensed an antigen associated with type 1 diabetes from Kings College, London, for which it will develop its preclinical product HiDex, which is a fusion protein between the mTCR and a cytokine that is a potent immunomodulator.

This should block the autoimmune response that otherwise leads to the destruction of insulin-producing islet cells.