Monthly Archives: June 2013

The News Net

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news net2In this edition of the News Net: positive news for the biotech sectors in France and the UAE, India is looking for a few good companies, and the Harlem renaissance continues.

 

 

  • The Nature News Blog recaps a report on the French biotech sector showing signs of recovery. Funding was up last year, and the number of new biotech companies created rose from 24 in 2011 to 35 in 2012, while the number of closures fell from 25 to 14. Read the story here.
  • India’s Department of Biotechnology is seeking proposals from companies needing R&D funding. Under its Small Business Innovation Research Initiative scheme, the DBT will support start-ups and SMEs with phase I and II funding. More details in Pharmabiz.
  • The National reports on the United Arab Emirates’ first-time inclusion in the Scientific American Worldview Report and Bio-Innovation Scorecard. The UAE leads the Arab world in biotech, ranking 40th in the world behind China and just ahead of Russia. Read all about it here.
  • Uptown Manhattan continues its economic rise as the Harlem Biospace opens in a converted factory building. The brainchild of Columbia University biomedical engineering professor Sam Sia, the incubator will host research facilities for up to 24 early-stage biotech companies. Full details in the NY Daily News.

Innovative Financing for Cancer R&D

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Tackling big issues, like cancer, requires striking out in new directions.

Over the past week, we have seen extended press coverage of the principles of a potential cancer ‘megafund,’ building on ideas from the October 2012 Nature Biotechnology article by Fernandez, Stein & Lo on “Commercialization biomedical research through securitization techniques.”  The Economist covered it here and the Financial Times added its commentary here.

The article proposes an innovative financial structure in which a large number of biomedical programs at various stages of development are funded by a single entity to reduce portfolio risk. The hope is that a cancer megafund in the magnitude of $5 billion to $30 billion could effectively produce the next generation of cancer therapeutics. The article has gained a following since its publication and has united thought leadership from scientific and financial communities to brainstorm together on this audacious goal. Through the support of MIT Sloan School of Management (where the co-authors are based), Alfred P. Sloan Foundation, American Cancer Society and National Cancer Institute, a CanceRX conference was held June 16-18, 2013.

The conference steering committee convened a diverse set of stakeholders who normally would not have the opportunity to discuss, debate or structure such ideas. Nobel Prize winners shared panel discussions with credit rating agencies, investment bankers and university technology transfer directors. Medical research centres debated with business school professors on not only funding innovation, but also new business models to make R&D dollars sustainable and predictable.

Financing the cure(s) for cancer is a complex problem. However, the conference was smartly structured into different streams so that participants could analyze and understand the core mechanisms separately before thinking about potential implementation of the whole. The key issues included:

  1. Scientific and engineering challenges
  2. New business models
  3. Financing structure, marketing and investor concerns
  4. Technology licensing and intellectual property issues
  5. Credit models and debt rating
  6. Government, healthcare reform and non-profits

One may think that $5 billion – $30 billion for a disease area sounds almost too big. Can it really be done? It strikes me that perhaps we can learn lessons from history and what we can accomplish if we are united to achieve a goal. At the same time as the MIT CanceRX conference, G8 leaders were gathering in Northern Ireland to discuss the global challenges of today. Thirteen years ago at the G8 Summit in Okinawa, Japan, political leaders planted the idea of a fund to provide resources for infectious epidemics afflicting the world: HIV/AIDS, Tuberculosis and Malaria. A year later, African leaders in Abuja endorsed the idea and in two years, the Global Fund to Fight AIDS, Tuberculosis and Malaria was born.

To date, the Global Fund has raised $25 billion in commitments and deployed $20 billion in grants to fight these infectious diseases and to strengthen health systems in more than 150 countries. The Global Alliance for Vaccines and Immunizations, formed to fund vaccines for the poorest 72 countries of the world, has had its funding supplemented by the International Financing Facility for Immunizations and the use of capital markets to issue bonds on government pledges. These billions have been raised on a model of donor commitments and grants. Imagine what powers can be unlocked from the trillions in the bond markets if capital to fund disease R&D can be recycled back to investors and through the innovation value chain?

Ideas have always started with people. The co-authors of the original paper have further developed their model and brought in the smartest minds in intersecting fields this week to meet each other. These working groups need a chance, time and space to work together – can innovative finance for cancer find an early adopter?

Julia Fan Li

Koreans Abroad and at Home

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Returning Koreans are one faction that have a chance to shape the future of the Korean biopharma landscape.

There has been considerable chatter about the glut of life science PhDs and a corresponding lack of jobs upon graduation. In the US, most graduate students in this field plan on becoming academics or industry scientists. But during my time in Korea, most life science graduate students I spoke with hoped to become professors, and nary a student spoke of industry. Despite a near-universal desire to enter academia, university positions are limited and competition is fierce (much like the US). Concurrently, Korea is gradually becoming competitive in the biotech arena, requiring more industry scientists to drive this engine of growth. Feeding all this is a large pool of domestically educated Korean scientists who are seeking positions after graduation.

To better understand how these forces will shape the future of Korean biotech, I spoke with Dr. Jong Sung Koh, chief technology officer of Genosco, a biotech company in Boston. Koh earned his PhD from Caltech and has had a long career in drug discovery on both sides of the Pacific, including serving as VP of drug discovery for LG Life Sciences. The following are excerpts from my conversation with him.

 

Q: What are your thoughts on Koreans who study abroad and then return, and what is their role in Korea’s biopharma industry?

Koh: Studying abroad or a postdoc in an academic institution is not enough to succeed in biotech. Some industry experience is important. When Samsung entered the semiconductor business, it recruited foreign industry-trained engineers such as Drs. Chin Dae-Je and Hwang Chang-Kyu. The failure of Hanhyo’s Life Science R&D center in the 1990s is a good counter-example: it recruited well-trained life scientists from academia without industry experience, and then spent R&D money on basic research, rather than in areas with industry applications.

There has been a recent influx of foreign, industry-trained scientists to Korea, mostly chemists from the US. So far the impact has been limited, with a few outstanding exceptions, such as the drug discovery directors at Green Cross Corporation and Handok Pharmaceuticals. However, Samsung has hired many Korean biologists who have biotech experience in the US. We will see how they impact the Korean biotech industry down the road.

 

Q: What about the locally educated talent?  It seems like there are many graduate students in Korea who are training in the biological sciences.  How will this impact the Korean biopharma industry?

Koh:  Home-grown graduate students and researchers have been increasingly publishing in prominent journals.  With industry experience, they can provide a strong workforce for the biotech industry. The bottleneck is the reluctance of graduate students to consider an industry career. However, the job openings for academia are so limited, they will begin to seek industrial positions soon. A flux of talented scientists to industry will provide new opportunities to Korean biotech in the near future.

One weakness of homegrown scientists is the limited ability to communicate in English, but this is improving as universities such as KAIST offers classes in English.

 

Q: In the US, graduate students in the biological sciences typically want to be professors or work in industry.  In Korea, it seems like industry is still maturing, so most people want to become professors.  When do you think graduate students will enter Korean PhD programs with the intent of going into industry? 

Koh: There are several components when scientists consider job tracks. Let’s consider two of them: job security and pay. If you compare the US and Korea, a professor’s job security is higher in Korea – almost all assistant professors will be tenured. This is not the case in the US. In the US, industry payscale is much higher than in Korea and also higher than US academic positions. So it’s a rational choice for Korean students to prefer an academic position, which pays better and provides a more stable job.

The bottleneck to increasing industry salary is that Korean biotech companies are small and produce lower profits than their US counterparts. The revenue of Dong-A Pharm, the biggest pharma company in Korea, is less than $1 billion. For Korean industry to compete, it needs to provide a better career outlook with higher payscale than academia and the possibility of a big upside (IPO, stock options).

Korean industry can consider a profit-sharing mechanism with in-house inventors, as well as providing more freedom to publish. In addition, Korean biopharma companies need to be large enough to support R&D, which can be accomplished by merging with one another. Implementation of these cultures and a shortage of academic position will entice graduate students to enter Korean PhD programs with the intent of going into industry in 10 years.

Gene Kym

 

Future Leaders Wanted

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IpshitaI wear two hats, one of a PhD student at University of Cambridge, and the other of a biotech social entrepreneur – in 2012 my lab mate Christian Guyader and I started Global Biotech Revolution (GBR).  The Biotechnology Industry Organization (BIO), as part of its outreach to organizations that support young people, invited us to attend the annual BIO convention in Chicago, where we hoped to learn how the world’s premier biotechnology conference functions.

The BIO convention is best described as the global biotechnology industry under one roof – held this year in McCormick Place, a massive convention center the size of four football fields. The main exhibition hall holds national pavilions from US, Brazil, Puerto Rico, UK, EU, Israel, China, India, Japan and Australia, to name only a few. Exhibitors include University TTO’s, governmental organisations, media and IP support, as well as a diverse range of biotech companies. There are representatives from the biopharmaceutical industry, from ag-bio, industrial-bio and also cleantech.

For us, two programmes particularly piqued our interest. The first was the International BioGENEius Challenge, which was organised for high school students to recognise outstanding research project designs in biotechnology. The winners for this year were announced at the convention. (More information can be found here.)

The second was a plenary session, Forbes 30 under 30, which invited four rising stars of science and healthcare to a panel discussion, covering their current endeavors, their key challenges, the role of mentors, and their vision of the industry over the next 20 years. The four were Laura Deming, 18, who started the Longevity Fund, which invests in ageing therapeutics; Isaac Kinde, 29, a MD-PhD candidate at John Hopkins School of Medicine researching DNA sequencing technologies for early detection of cancer; Adina Mangubat, 25, CEO of Spiral Genetics, which analyses DNA sequence data; and Joshua Sommer, 24, who suffers from bone cancer himself and started the Chordoma Foundation to bring together chordoma researchers from across the world.

This group is incredibly inspirational for their collective passion, but the biotechnology industry needs more of these young, passionate drivers, from all regions of the world, to come together and debate the current and future issues of the global bio-economy. I believe it’s important for the next generation of bio-leaders to expand their outlook and knowledge of bio-economies to global scale opportunities. The focus lens needs to broaden from US, Europe and the biopharmaceutical sub-sector, to the breadth and diversity of biotech with all its prospects globally.

To drive this agenda forward, we are organising the Gap Summit 2014, the world’s first inter-generational leadership summit in biotechnology that connects future bio-leaders to the leaders of today. One hundred young bio-leaders from across the world will be selected to discuss issues in biotechnology with current biotech think-tanks, industrial leaders and research pioneers. The summit will ask them to challenge the current state of the global bio-economy, and consider grand issues that the field will need to address by 2050.

Many conferences espouse the benefits of connections, knowledge and inspiration, and that was on display at BIO, as well. My hope is that the Gap Summit conference will give the global young leaders of tomorrow the opportunity to challenge current knowledge, industrial dogmas, current leaders, and each other, for the benefit of the global biotech field.

Ipshita Mandal