Bridging the Valley of Death: Insights from Drug Discovery and Funding Strategies

1. Successfully securing funding Drug discovery to University Spin-out Dr Kevin Adams Institute of Cancer Therapeutics and Incanthera Ltd

2. The valley of death Declan Butler (2008) Nature453, 840-842

3. 3 hills and 2 valleys

4. 5 hills and 4 valleys Meslin et al (2013) Mapping the translational science policy ‘valley of death’ Clinical and Translational Medicine 2013, 2:14

5. The valley of death In vivo proof of concept First in man clinical trial

8. …or is it? Bruce Booth, Forbes 22 May 2013

9. Biomedical catalyst • Through targeted funding, the Biomedical Catalyst aims to bridge the so-called ‘valley of death' which can exist in getting ideas out of the lab and into the marketplace. • The report shows that, in just over a year since it opened, the Biomedical Catalyst has: • awarded over £120m in funding, over £80m of which is to support innovative, business-led research • leveraged almost £70m of additional, project-specific private capital.  • Over 100 projects from all over the UK have been supported.

10. Big pharma are failing • Not getting new drugs through trials • Not getting new drugs to market • Pipelines are poor for many

11. Consequences of failure • Rethinking strategy • Closing internal R&D sites • Looking for late stage deals – short term • Looking to pick up molecules from small biotechs and research institutes – longer term • We need to see this as an opportunity

12. Big pharma as VCs • Most of the big pharma companies have recently set up “investment companies” • But everyone is trying to attract their interest. • Supposedly looking at early stage investment • But generally still want to see Phase 1 clinical data • Need to have a good strategic fit.

13. Pharma influences VCs • Size of failures has an impact on how VCs view risk. The more risky the less likely they are to put up money. • Venture capitalists like to invest in things that they think big pharma will like. • Need to consider this when constructing a pitch • Sometimes investments aren’t always as rational as you might expect.

14. Trending in cancer. PhRMA (2012): Medicines in Development Cancer, 2012 Report This lists nearly 1000 anti-cancer drugs at preclinical and clinical development stage in the US alone http://www.phrma.org/sites/default/files/1000/phrmamedicinesindevelopmentcancer2012.pdf

15. So what are pharma thinking? • Analyses of these US cancer projects show that just eight drug targets account for around 40% of all projects in preclinical or clinical stages of development. • Each of these eight targets was identified as having at least 24 individual clinical programmes Bruce Booth (2012): Cancer Drug Targets: The March of the Lemmings http://lifescivc.com/2012/06/cancer-drug-targets-the-march-of-the-lemmings/

16. It might be unfair to lemmings but.. Serine/threoninekinase Receptor tyrosine kinase Receptor tyrosine kinase Receptor tyrosine kinase Receptor tyrosine kinase Phosphatidylinositol 3' -kinase Receptor tyrosine kinase Receptor tyrosine kinase

17. Start-up • What do all these messages mean for a start-up gazing across the valley of death. • Need to use this sort of information to develop your strategy. • For me there are four things to focus on to give the best chance of success.

18. 4 vital ingredients

19. Product - ICT2588, a targeted cytotoxic Non-specific exopeptidase activity Azademethylcolchicine Specific endo-peptidase cleavage by MT1-MMP

20. 8 7 Control 6 5 ICT-2552 (60mg/kg) 4 ICT-2588(150mg/kg) [30mg/kg metabolite] 3 Mean relative tumour volume 2 1 0.9 0.8 0.7 0.6 0.5 0 1 2 3 4 5 6 7 8 9 10 11 Time (Days ) Product • Targeted • Non-toxic • Kills tumours

21. Protection • Three patents • First nearing end of national phase – recently granted in US • Second in national phase • Third recently filed – in conjunction with Stanford University

22. People • Academic inventors still involved but in the background • CEO Dr Simon Ward, serial entrepreneur with good VC connections • Executive Director Dr Alan Warrander, former Director of Global Licensing at AZ • Me as programme manager – background in industry • Professor Chris Twelves – clinical oncology lead • People are very important to VCs

23. Plan • Know where you are and where you need to get to. • Be honest and realistic about what you do/don’t know – find someone who does. • Break it down into individual task with key value added milestones. • Get some quotes for work to be done – realistic costs. • Build in contingency and timeline flexibility. • Understand the cash flow but more importantly the exit. • Phase 1, Phase 2 or later?.

24. Some cancer deal examples

25. Plan • Elevator pitch • Executive summary • Business pitch • Business plan • Practice and refine all the above but most importantly get out and deliver.

26. Plan • Listen for feed back • Learn from it • Anticipate the negatives and turn to your advantage

27. Refining the Incanthera plan VC response in general was • MMPs – failed as a target previously • VDAs – failed in clinic • Cytotoxics are old fashioned

28. From Overall and Kleifeld (2006), Nature Reviews:Cancer 6:227-239

29. MMP inhibitors fail • Good news – • MMPs are clearly a valid target • More importantly, we aren’t trying to inhibit MMPs but are using their localised expression to target tumour vasculature

30. VDA failures • Compounds include • ASA404, • ABT-751, • Dolastatin-10, • TZT-1027, • ZD6126, • CA1P and CA4P • MPC-6827 • MN-029. • In all cases, cardiac toxicities are prevalent. Hollebecque et al (2012) CurrOpinOncol. 24(3):305-315.

31. VDAs fail • Good news – • clearly pharma wants a good VDA • targeting overcomes cardiotoxissue • ICT2588 even mentioned in Hollebecque et al (2012) as being a good way to overcome the problem.

32. Cytotoxics • Yes they are old fashioned... • ...but they work! • Many of the most effective and widely used cancer drugs are still cytotoxics.

33. Incanthera success • Took 2 years to get first funding of £350K – beware University legal teams – signed off in December 2011 • A year later (end 2012) we were up to £1.2 million • US based VC • UK based Angel consortium • This year we’ve had a letter from the WellcomeTrust offering investment of around £1.6 million in the form of a convertible loan (subject to contract).

34. Incanthera the future • Enough funding to complete Phase 1 (subject to contract) • Scale up chemistry and formulation development done. • Toxicology studies currently being done • Hope to start clinical trial by summer of 2014 • A successful trial will probably result in a sale/licensing of the technology • Aim to retain some of that funding for pipeline.