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Adventures in Biotechnology Boro Dropulic PhD, MBA.

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Presentation on theme: "Adventures in Biotechnology Boro Dropulic PhD, MBA."— Presentation transcript:

1 Adventures in Biotechnology Boro Dropulic PhD, MBA

2 Overview Background Decision to Start a Biotech Biotech Business Models Financing of Biotech Companies Modes of Productivity & Relationship to Business Models The relationship between Business Models and Investment Case Study: Lentigen Business Presentation

3 Background PhD in Australia (University of Western Australia) Fogarty Fellow at NIH Bld 10 then Bld 4 –Embryonic Stem Cells –Gene Therapy Johns Hopkins University –HIV vectors targeted to HIV infected cells (new IP) VIRxSYS –First group to initiate and complete Lentiviral vector clinical trial (gene therapy for HIV infection) MBA (Johns Hopkins University) Lentigen –Broad business Model

4 Starting a Biotech Company Defining the technology –Can the technology be used for multiple uses? –Licensing strategy vs starting a biotech company If decision to start a company then: –What are the objectives? Sell the company to large biotech or pharma Grow the company and license out products Organization and focus of the company –Single product focus short term exit strategy –Multiple products long term exit strategy

5 Therapeutic Biotech Business Model

6 Milestone driven value - technology

7 Financing of Biotech

8 OR Derive revenue streams from the sale of product or services (research tools products & services) Smaller market potential - more difficult to attract investors - revenue streams are much smaller than the therapeutic or vaccine markets - requires organic growth strategies

9 The Very High Risk Nature of the Conventional Biotech Business Model High risk = high failure rate Especially true for biotech focused upon development of biologics Failure not always related to science Investor understanding of the technology and product development cycle time is very important Financing strategy must match product development cycle time

10 Potential Saving Graces Government Grants (SBIR etc) Private Foundation Grants Contracts (Government or Private/Foundation) Out-license portions of the technology Other financing models

11 Chimeric Business Models for High Risk Technologies Long Lead Times to Therapeutic Markets Gene Therapy Cellular Therapies Stem Cell Therapy Vaccines (viral vector) RNAi (viral vector shRNAi) Therapeutics Service / Research Products Therapeutics Validation / Growth Decreased Risk vs. Lack of Focus

12 Models of productivity Femme à la resille (Woman in a hairnet), 1938, by Pablo Picasso. Still Life with Carafe, Sugar Bowl, Bottle, Pomegranates, and Watermelon, 1906, by Paul Cezanne Young GeniusOld Master Geoff Race CFO Pangenetics Index Forum 2007 Stresa, Italy Paintings most valuable = early workPaintings most valuable = late-in-life work value

13 Comparison of Productivity Models Young Genius Innovation –Non-linear; concept Short term horizon –Rapid, immediate Low # of objectives –Single focus Singularity of Purpose –Virtual; simplicity High Risk –No track record Old Master Experimentation –Process driven Long term view –Quality mindset Higher # of goals –Competing priorities Complexity/ Integrated –infrastructure Low Risk –Track record

14 Comparison of Business Models Single product Biotech Company Innovation Short term horizon Low # of objectives Singularity of Purpose High Risk Concept Based Value Growth Multiple product Biotech Company Experimentation Long term view Higher # of goals Complexity/ Integrated Low Risk Linear Value Growth

15 Comparison of Business Models Single Product Biotech Innovation Short term horizon Low # of objectives Singularity of Purpose Multiple Phases High Risk Concept Based Value Growth ACQUIRED Multi Product Biotech Experimentation Long term view Higher # of goals Complexity/ Integrated Lifes Work Low Risk Linear Value Growth IPO - ALLIANCES BOTH ARE VALID GROWTH STRATEGIES

16 Growth Strategy Needs to Match Investor Strategy Investor Strategies –Large number of singly focused companies vs few technological platform companies –Shorter exit time for singly focused companies, but high risk –Longer exit time for technological platform companies, but lower risk Investor Sophistication Important Choice of Investor Critical for ultimate success

17 Company Presentation January 2008

18 Safe Harbor and Confidentiality The following information is confidential and should not be distributed without the permission of Lentigen Corporation. This presentation contains certain forward looking statements based on Lentigens current beliefs and expectations about future events. These statements are subject to numerous risks, uncertainties and assumptions and are not necessarily predictive of future results. Actual results may differ materially from those anticipated in this presentation depending upon a variety of factors including development of manufacturing procedures, market size and revenues, potential competition, regulatory compliance, operating effectiveness and other factors that may not be currently considered as material.

19 Summary Lentiviral Vector (LV) gene delivery technology Four phase I/II clinical trials in 2008/9 Eight NIH/DOD grants supporting future therapeutic pipeline Alliance with ThermoFisher - LV RNAi research tools Dominant Intellectual Property Position Experienced management team and board of directors Upcoming Milestones

20 Lentigen Overview Established 2004 Location: –Gaithersburg, Maryland 2008Q1 –25,000 ft 2 ; multi-product GMP facilities Employees: 40 Technology platform focus –Lentiviral vector mediated gene delivery Areas of application –Vaccines & Therapeutics –Research and Drug Discovery Tools

21 Lentiviral vector (LV) gene delivery Most efficient, stable gene delivery system known LentiMax LV system High titer, low toxicity Scalable manufacturing process Bench to clinic translatability

22 Human kidney cells Efficient & stable gene delivery with LV-GFP (Green Fluorescent Protein) Cells before addition of LV-GFP Cells after gene delivery with LV-GFP 98.7%

23 Vaccine & Therapeutic Pipeline ANIMAL STUDIES R & D SCALE UP PRE- CLINICAL IND PREP PHASE I/II CLINICAL INDICATION GLIOBLASTOMA CANCER (GVHD) INFLUENZA VACC. ANEMIA HEPATITIS C LEUKEMIA (CLL) COR. ARTERY DIS. LYMPHOMA (EBV) HEMOPHILIA MELANOMA

24 Glioblastoma 18,000 per year (USA) cases with comparable market in Europe –50% malignant with 40 week survival –Market size estimate - $300 million+ Easily addressable patient population –Patients concentrated at surgical centers –Limited sales force –Targeted physicians No good current treatment available –Treatments limited by toxicity Temezolomide (TMZ) effectively treats disease –but prolonged TMZ treatment results in severe lymphopenia and thrombocytopenia death

25 Glioblastoma therapy using LV-MGMT Protection of stem cells from TMZ toxicity longer TMZ treatment better outcomes for patients LV-MGMT can protect stem cells from effects of TMZ Proof of concept shown in dogs and monkeys Clinical trial endpoints are short – 3 weeks CWRU (Dr S. Gerson) Broadly applicable – CML, AML, HIV etc IP exclusively licensed LV MGMT STEM CELLS Bone Marrow Transplantation TEMEZOLOMIDE PROTECT STEM CELLS KILL TUMOR

26 Graft versus Host Disease (GVHD) In 2005: 7,250 allogenic transplants in USA and 10,000 worldwide –50% develop chronic GvHD –Market size estimate - $300M to $500M –Potential for huge savings to healthcare system Easily addressable patient population –Patients concentrated at transplant centers –Limited sales force –Targeted physicians No good current treatment available

27 GVHD therapy using LV-TMPK Two technological advances –LV efficient gene delivery –TMPK human safety gene Proof of concept shown in primary human T cells Short clinical trial endpoints 3 weeks to 3 months CRADA with NIH; 2 sites; Drs Gress, Fowler, others Broadly applicable to other diseases – cancer, HIV etc IP exclusively licensed DONOR LV TMPK T CELLS DLI + BMTAZT STEM CELLS RECIPIENT IF GVHD THEN + AZT KILL ALLO T CELLS

28 Pandemic & Seasonal Influenza Influenza infects 10-20% of the population every year and causes 500,000 deaths Approximately 300 million doses produced globally Market Size = $1B in 2004, rapidly expanding market Need for vaccine MFG efficiencies –Egg manufacturing not cost effective –Cell culture with L.A. virus is limiting Need for development of a rapid and efficient cell culture based vaccine manufacturing platform

29 LV-IFVX Influenza VLP vaccine Rapid manufacturing platform weeks not months MFG time Virus Like Particles (VLP) –highly immunogenic Exact strain match –no genetic drift during production Continuous production of VLP –advantage over batch production Safe –VLPs are genetically inactive IP protected Synthesized gene cloned into LV 1 week LV manufacture and QC testing 1 week LV transduction 1 day Scale Up cells 3 weeks Vaccine Purification 1 day

30 Potent Immune Response in Mice Log Serum dilution Absorbance Vaccine only Vaccine with adjuvant Prebleeds Strong immune response generated in mice against Lentigens H5N1 VLP vaccine (blue) and vaccine with adjuvant (purple); pre-bleed controls (red)

31 Biogenerics & Proprietary Biologics Biologics that are coming off-patent are worth >$30B –Erythropoietin, cytokines, coagulation factors, antigens, McAbs COGS critically important for competing in the protein MFG markets –Efficiencies gained by decreasing time to market –Efficiencies gained by increasing yield from cell lines LVs can reduce time to market and decrease COGS –High copy numbers in cells without gene amplification –Integration in areas of open chromatin higher expression

32 Erythropoietin production Gold Standard Efficient –Bulk CHO Cells > 2.5 g/L –No cell cloning –No selection –No enhancement of cell growth conditions –Levels of 5 – 10+ g/L attainable with isolation of cell clones

33 Research & Drug Discovery Tools Pipeline RESEARCH & DEVELOPMENT PRODUCT LAUNCHED PRODUCT SMARTVECTOR RNAi* CUSTOM LVs LENTI-GFP, YFP, LUC LV MFG (GLP, GMP) PROTEIN EXPRESSION LENTIKIT LENTI PROMOTER LENTI cDNA LIBRARY LENTI RNAi LIBRARY LENTI EXPRESS KIT LENTI CELL LINES Alliance with ThermoFisher Scientific to market LV RNAi products

34 SMARTvector RNAi: Effective gene silencing SMARTvector GAPDH RNAi SMARTvector Control SHSY5Y neuronal cells Fixed and stained with GAPDH antibody (red) and Hoechst (blue) GAPDH knockdown 9 days post-transduction with SmartVector shRNAi Lentiviral vector particles

35 Effective gene silencing in a wide variety of cells 75% Difficult-to-Transfect Stem cells Suspension cells Neuronal cells Suspension cells

36 Intellectual Property Dominant patent estate for Lentiviral vectors –Lentigen (GBP IP) has acquired the entire Cell Genesys Lentiviral vector IP portfolio –Non-provisional patent coverage of: Novel LV compositions and methods Use of LVs for Influenza VLP manufacturing Use of Novel LVs for protein manufacturing Lentigen has exclusively in-licensed several key payload technologies –TMPK LentiSafe technology –MGMT LentiSelect technology Lentigen continues to develop and in-license additional key proprietary intellectual property

37 Grants Seven (7) SBIR Grants from National Institutes of Health –Leading Clinical Centers & Investigators –Oncology –Infectious Diseases STTR Grant from Department of Defense –Efficient Manufacture of Monoclonal Antibodies in the National Stockpile MIPS Grant –Development of new animal models for cancer

38 Experienced Management Boro Dropulic, PhD, MBA - Founder and CEO –19 years experience –Founder & CSO of VIRxSYS, Johns Hopkins University, NIH –Sponsor Investigator of first Lentiviral Vector Clinical trial in humans Adam Sachs, MSE – President, Commercial Operations –23 years experience –Life Technologies (now Invitrogen), Qiagen, Origene –Global Director for Manufacturing at Qiagen Gregory Feulner, PhD, JD – VP, Business Development –19 years experience –NIH, Johns Hopkins, Gene Logic Inc., Galileo Genomics, 3M Yung-Nien Chang, PhD – VP, Vector Development –22 years of experience –Johns Hopkins University, VIRxSYS, NIH, GTI (now Novartis)

39 Board of Directors David Wetherell – Chairman of the Board –Former Chairman, CMGI, –Founder, Greenwich Biotech Ventures Boro Dropulic, PhD, MBA Douglas Lind, MD –Managing Partner of Accendx Management LLC –Former Senior Biotech. Equity Analyst at Morgan Stanley & PaineWebber John McMullen, JD, MBA –Managing Principal of Cambridge Meridian Group –Republican Nominee for Senate, VT (2004) Robert Breyer –Former President/COO of Alkermes –Former President and General Manager of Eli Lilly Italy Barrie Carter, PhD –EVP and CSO of Targeted Genetics –Former Chief of the Lab. of Mol. & Cell Biology at the NIH

40 Upcoming Milestones Initiate phase I/II clinical trials for GVHD & Glioblastoma Complete pre-clinical studies for Influenza vaccine and Erythropoietin protein product Continue development of pipeline for therapeutic & vaccine products, leveraging grant funding mechanisms Expand alliance with ThermoFisher and other partners Certify Lentigens new GMP manufacturing facilities Complete additional financing

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