QUEEN MARY BIOENTERPRISES Discovery...access to an innovative Phase IIa compound, PrEP-001." hVIVO...

DiscoveryNEWS, VIEWS AND EVENTS AT QMB

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IN THIS ISSUE

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n DOUBLE MILESTONE FOR ADCT –PAGE 2

n INTERVIEW WITH DR PHILLIPHOWARD, CHIEF SCIENTIST,SPIROGEN – PAGE 8

n MEDIWISE MAKES STRIDES –PAGE 6

EDITOR’SWELCOMEWelcome to the latest issue

of the QMB Newsletter.Antibody Drug Conjugates (ADC) are a massivegame changer in how cancer can be treated,potentially reducing and in some caseseradicating the need for chemotherapy andits debilitating side effects. At QMB we arelucky to have not one but two companiescarrying out pioneering research in this area:Spirogen and ADC Therapeutics (ADCT).

In this issue, we speak to Dr Phil Howard, Chief Science Officer

at Spirogen about how he got into cytoxic warheads. We also

catch up with Themos Kallos, MediWise’s Chief Science Officer,

to see how the company is expanding its range of products.

We caught up with our latest tenants, BioRelevant, who

moved into the centre in July to see what they’ve got planned

for 2016. Quite a lot, as it happens, including the launch of a

new product in January.

In other news, ADC Therapeutics (ADCT) has bolstered its

Board with the appointment of Dr Hans-Peter Wild and

Jacques Theurillat to its Board of Directors as Non-Executive

Directors. Elsewhere, hVIVO raised £20.5 million in an equity

share placing and acquired a stake in PrEP Biopharm Limited

(PrEP) for £14 million.

We also have coverage of a very interesting panel discussion

from QMB’s BioWednesday event with One Nucleus which

looked at the challenges the new Mayor of London will face

when they assume the post in May 2016.

For more updates and the latest news from QMB, includingDr Ramsay Richmond’s life sciences sector blog, please visitour website. And we’re eager to hear your perspective too,so please share your feedback in the comments section onour website, or join the conversation on our Twitter page.

Nas

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ADC Therapeutics SA has announced a doublemilestone in pre-clinical results for two of its novelADCs, ADCT-301 and ADCT-402.The Company recently received clearance from the USFood and Drug Administration (FDA) to begin clinical trialswith ADCT-402, a novel antibody drug conjugate targetingCD19, a cell-surface antigen, which is over-expressed inmany patients with B-cell non-Hodgkin Lymphoma (NHL)and B-cell Acute Lymphoblastic Leukaemia (ALL).

It also presented pre-clinical results for both ADCT-301 andADCT-402, at the 57th American Society of Hematology(ASH) Annual Meeting, December 5-8, in Orlando, Florida.

ADCT-301 is currently in Phase I for lymphoma andleukaemia. ADCT-301 combines HuMax®-TAC, a humanmonoclonal antibody targeting CD25 (the alpha chain of theIL-2 receptor) created by Genmab A/S, with a dimericpyrrolobenzodiazepine (PBD) warhead. The data confirmsthe mechanism of action of ADCT-301 and provides relevantpharmacodynamic assays for use in clinical development.

Dr Patrick van Berkel, Senior VicePresident Research & Developmentat ADC Therapeutics, said: “We arehighly encouraged by these datawhich demonstrate the potential ofADCT-301 and ADCT-402. As wecontinue development, earlyindications are that our PBD-basedADCs could offer superior efficacy

with a reduced resistance profile for the treatment ofhaematological tumours.”

ADCT-402 combines a humanised monoclonal antibodytargeting CD19 with a pyrrolobenzodiazepine (PBD)warhead. ADCT plans to initiate Phase I clinical trials in bothNHL and ALL.

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In preclinical in vivo models, ADCT-402 exhibited strongdose-dependent anti-tumour activity against CD19-positiveleukemic and lymphoma cell lines at low single doses, andit outperformed other CD19 targeted ADCs currently inclinical development, the company said.

The first of the Phase I clinical trials for patients with B-cellNHL will commence at eight leading oncology centres inthe USA and two centres in the UK. The initial study willevaluate the tolerability, safety, pharmacokinetics andantitumor activity of ADCT-402 in patients with relapsedor refractory B-cell NHL. Subject to study results, ADCTintends to rapidly expand the numbers of patients inthe trial and expand the number of participatingclinical centres.

Dr. Owen O’Connor, Professor of Medicine andExperimental Therapeutics, and the Director of the Centerfor Lymphoid Malignancies, and Co-Program Director ofthe Lymphoid Development and Malignancy Program inthe Herbert Irving Comprehensive Cancer Center atColumbia University Medical Center, is the PrincipalInvestigator for this Phase I study.

Dr. O’Connor said: “There is significant unmet medicalneed for patients with relapsed or refractory disease inB-cell NHL. An ADC targeting CD19 with a potent PBDwarhead, is a sensible approach in this difficult to treatpopulation. We are delighted to be working with ADCTherapeutics to bring this potential treatment to patients.”

The second study, a Phase 1 trial for patients with relapsedor refractory B-cell ALL will commence simultaneously at10 centres in the USA and EU to evaluate the tolerability,safety, pharmacokinetics and anti-tumour activity of ADCT-402 in this patient population. Dr. Nitin Jain, AssistantProfessor in the Leukaemia Department at MD AndersonCancer Center in Houston, Texas, the Principal Investigator

for this Phase 1 study, said: “We have made significantstrides treating patients with B-Cell ALL but we are stillseeking new treatment modalities to improve theprognosis for patients. We are excited to be working withADC Therapeutics on this program.”

Dr. Jay M. Feingold, Senior Vice President and ChiefMedical Officer at ADC Therapeutics, said: “This is thesecond ADC we have advanced into clinical developmentin the past eight months. Preclinical data suggests thatADCT-402 may have significant activity against B-cell NHLand ALL and we are pleased to progress our pipeline bybeginning these two clinical studies and, hopefully, tobring significant benefit to patients with these diseases.”

Acute Myeloblastic Leukemia (AML)Ë

hVIVO plc, pioneers in human challengemodels of disease, had a very busy November.The company raised £20.5 million in an equity shareplacing and acquired a stake in PrEP Biopharm Limited(PrEP) for £14 million to continue the development ofthe prophylactic compound PrEP-001 (previously JNJ-43260295). In addition to hVIVO, lead investors in theUK-based start-up company include Johnson & JohnsonInnovation – JJDC, Inc. and US-based angel investors.

The company placed 9.1 million shares with existinginstitutional shareholders at 225 pence per share. hVIVOwill use the money to back its development portfolio,which includes progressing including PrEP-001 toPhase IIb, start asthma stratification and advance theflu pathomics outputs into product candidates.

The proceeds are expected to be invested in the researchand development programmes over the next two years.

PrEP-001 is a nasally administered, broad-spectrumagent that leverages the innate immune system toprevent upper respiratory tract viral infections (colds andflus) and is designed to help the large number of patientsthat suffer substantial morbidity and mortality as a resultof upper respiratory viral infections.

A successful proof of concept study of the compoundwas conducted by Janssen using hVIVO’s platform in2013-14. PrEP is developing infectious disease productsand technologies licensed from Janssen and will take thecompound’s development forward. It will conduct phaseIIa studies in flu and asthma patients in hVIVO’s facilityduring 2015 and 2016, further leveraging the hVIVOplatform’s speed of trial conduct and ability to generateclear efficacy signals.

LicenceWith this investment, hVIVO takes a significant stakein a new company developing a product that hVIVOhas already helped to advance and is well placed tosupport in transitioning into later phase trials in at-riskpatient groups.

Janssen is granting a worldwide license to PrEP inexchange for equity in PrEP, together with downstreammilestones and royalties. hVIVO is acquiring equity inPrEP for £14 million and PrEP is contracting with hVIVOServices Limited to conduct a £10 million phase IIaclinical programme of work in 2015 and 2016.

hVIVO’s investment will be accounted for as aninvestment in associate in its balance sheet and, in theapplication of the equity method as an associate, the£10 million phase IIa clinical programme of work will berecognised as revenue.

hVIVO CEO Kym Denny said: "We are delighted at theresponse and immense support we have received fromour shareholders to raise these funds. This has been aremarkable year, one where the growing recognitionregarding the value of the hVIVO platform culminatedin our PrEP Biopharm announcement and we gainedaccess to an innovative Phase IIa compound, PrEP-001."

hVIVO is exploring a technology platform of humandisease models to speed up drug discovery anddevelopment in respiratory and infectious diseases.

hVIVO hires Mandy Higgins as BusinessDevelopment Director for EuropehVIVO has appointed Mandy Higgins as its newBusiness Development Director for Europe, workingpredominantly across the UK and Western Europe.

She joins from BARC Global Central Laboratorieswhere she held the position of Executive BusinessDirector. At BARC, Mandy was responsible forgenerating new business within the UK, Scandinaviaand Israel in addition to looking after further keyaccounts outside of these locations.

Mandy comes from a lab background, having held rolesat ICON Central Laboratories and at PPD Global CentralLabs. Mandy's role at hVIVO will see her focused on itshuman challenge models services business.

Mandy said: “I am delighted to join hVIVO and lookforward to working with the team.”

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hVIVO raises cash andacquires stake in start-up

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Biorelevant, the makers of powders whichsimulate the juices found in the stomach andsmall intestine, is launching a new product inJanuary aimed at the veterinary canine market,which has the potential to reduce the need forinvasive animal testing.The Biorelevant team, headed by brothers Daryl and LouisLeigh, took up residence at QMB in July, taking over 800square feet of purpose built lab and office space.

As the name suggests, the Company’s products test the‘biorelevant’ solubility and dissolution of drugs, predicting howthey will react in the human body. Their powders simulate thejuices in the stomach and small intestine both before and aftereating – the so-called fasted and fed states - by replicating veryclosely what is happening inside the gastrointestinal tract.

“We're working hard to introduce an exciting raft of newbiorelevant products with amazing predictive power that willtransform the way oral drugs in particular are developed, andwe’ve got an exciting new product which we are launching inJanuary,” Daryl told QMB.

Fast DogThe new product - Fasted Dog - is a complex powder made upof different bile salts and phospholipids. The new solution willsimulate the conditions of the fasted, or without food, caninestomach and intestinal fluids.

“We’ve got veterinary customers but they tend to buy thehuman version and then marry it up with the dog. But this is aspecific product for the veterinary industry and for developingdog medicines,” said Daryl.

"Fasted Dog" will be used to investigate drug behaviour byindicating how and to what extent a drug enters thebloodstream. It is hoped the product will ultimately improveand decrease drug investigations on dogs, essentially doingaway with invasive investigations, and hopefully moving thepharmaceutical industry towards reducing tests on animals.

“Fast Dog is an accurate simulation of the dog’s intestine andstomach and we believe it will provide a viable alternative forthe clinical testing of dogs. So it could be really helpful insaving money and more importantly, saving the lives of thedogs,” said Daryl.

Biorelevant is a spin-off from a contract research organisationand has close ties with Goethe University of Frankfurt.‘Biorelevant media’ has been around as a testing tool for quitea few years, but Daryl and Louis saw an opportunity to

commercialise it globally and three years ago decided to movethe business back to the UK.

Their client list now reads like a Who’s Who’s in the world ofpharma, with customers in industry and academia stretchingfrom North America, Europe, the Middle East and beyond.

Educate“Most of our business is centred in Northern Europe and NorthAmerica, because the institutions there are possibly more intune with what we can offer and how it’s developing as a tool,but we’re seeing really good growth in Asian markets as well.Our challenge is to educate the industry about the benefits ofusing accurate biorelevant media,” said Daryl.

Biorelevant’s products include FaSSIF, FeSSIF and FaSSGFwhich, to date, have focussed almost exclusively on productsfor human ingestion. Their products’ close similarity to what'sinside the human body makes them very valuable forpharmaceutical companies (CROs, Drug Developers andGenerics Manufacturers in particular) but also extremely helpfulto the Functional Food, Vitamin and Medical Device industries.

The team includes Warren Peakin as head of logistics and MarkBerlin, who joined in July from Goethe University of Frankfurt,where he worked with Professor Jennifer Dressman. Mark hasalso just completed his PhD in Biorelevant Media.

The Company is also being advised by their father, StevenLeigh, an industrial pharmacist with a long and successfulhistory in the industry. During his student days, Steven came upwith the idea for a night-time remedy for colds and flu whicheventually became Night Nurse. He also came up with theWitch Doctor Skin Treatment range, including Witch Hazel.

The Biorelevant team used to be based on an industrial estatein Croydon, which suited their needs at the time. But as thebusiness expanded, they made the decision to move closer toLondon. So why choose QMB as a base?

“We’re a pharmaceutical business but we’re also a pharmatech business, so we really like the physical location and thefact we’re in an innovation centre. That really appealed to us.We’re also planning to hold seminars and workshops at somepoint next year, so the facilities at QMB will really help withshowcasing what we’re doing,” said Louis.

Daryl added: “Queen Mary University of London is one of ourcustomers from before we moved in, and I think going forward,maybe in the next year or two, we would like to work moreclosely with QMUL. It’s got a very good Pharmaceutical course,so being so close to the University will also help us withrecruitment as we expand the business.”

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MediWise is making greatstrides on a number of frontshaving recently completed itsfirst animal trials for its non-invasive glucose monitor,GlucoWise, and securingfunding from InnovateUK for anumber of other projects. GlucoWise is a first of its kind glucosemonitor which safely detects theconcentration of glucose in the bloodstream without having to draw a bloodsample. The trials were held atNorthwick Park Institute of MedicalResearch in north London in July 2015,overseen by Themos Kallos, MediWise’sChief Science Officer.

The trials were conducted on pigs asthey can be safely sustained in ahypoglycaemic state, which, for humans,might prove fatal, but is perfectlyharmless for the pigs.

“We chose pigs for two reasons. Firstly, you can sustainlower glucose levels in pigs which in humans you are notallowed to do, so it was a good test to see how sensitiveour device is. It’s very easy to measure high glucoselevels, but it’s when glucose levels are low that you get areal test. Pigs allow you to do that because they can besustained in what, for humans, would be a hypoglycaemicstate but for them it’s perfectly healthy,” said Themos.

The trials compared the accuracy of MediWise’s non-invasive glucose measurement method against thehighest accuracy lab based method available (ILab 650Chemistry Analyzer).

MediWise makes stridesThe GlucoWise monitor works by gently cradling theskin between the thumb and the index finger. Once themonitor is in place, the user simply presses the end ofthe monitor to begin. In the final clinical device, it ishoped that, after a few seconds, an accurate readingof the user’s current blood glucose levels is displayedon the device.

CorrelationThe animal tests proved there was a clear correlationbetween the glucose measurement in the GlucoWiseprototype and the lab analyser. The test showed theywere able to detect similar glucose levels withoutdrawing any blood.

The plan now is to press ahead with the firsthuman trials in early 2016. These will be conducted incollaboration with Dr Richard Mackenzie at the Universityof Roehampton in south of London and managed byThemos and Nadine Geddes, a fellow co-founder ofthe company.

The trials will involve a controlled study of healthy humansubjects. The trials will compare the accuracy ofMediwise’s non-invasive glucose measurement methodagainst the traditional finger prick monitors, as well asthe highest accuracy lab based method available.

As well as GlucoWise, MediWise also has two otherproducts in development: MammoWise, a breast cancerimaging system, and MetaSurface, which aims to cutdown on the time it takes to do a MRI scan by at least50%. MetaSurface was patented in July.

“The MetaSurface technology has been patented andwe’re now developing our first prototype ahead ofconducting our first trials hopefully some time in late2016,” said Themos.

Themos Kallos

Nadine Geddes

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Funding from InnovateUKThe company has also received nearly £700,000 infunding from Innovate UK, formerly known as theTechnology Strategy Board and sponsored by theDepartment for Business, Innovation & Skills, to exploreprojects in each of the three areas the company ispioneering its research.

For example, the team is developing a material calledMetaSurface - or “smart” material technology, which is aproprietary non-ferrous metallodielectric grid compactstructure. The team is investigating the feasibility ofthis breakthrough invention to drastically increase MRIefficiency by improving its signal-to-noise ratio (SNR).

It is a thin mat-like structure, positioned underneath apatient’s body as they lie flat on the MRI table. It is apassive device with no electrical or mechanical partsand can be easily repositioned or moved from onemachine to another.

The project will expand on preliminary experimentaland pre-clinical data and will deliver a new prototypeto be used on human subjects for the first time. Thetechnical feasibility study will demonstrate MetaSurface’sperformance enhancement reporting on SNR, MRI imageacquisition speed, sensitivity and image resolution.

MetaSurface is also machine-agnostic, which means itcan be used with any commercial MRI scanner for anyfield-strength and has the potential to increase thepatient throughput by 50%, which could translate intomillions of pounds worth of cost savings per yearfor the NHS.

MammoWiseFor MammoWise, the team is also looking to developa new medical imaging prototype based on microwaveimaging (MWI) for cancer detection, particularly inbreast cancer.

MWI uses low-power, non-ionizing radio frequencymicrowaves to obtain clinically meaningful images ina way that addresses the patient’s needs for speed,safety and comfort.

While there is considerable progress in medicalMWI systems under development by various researchgroups worldwide, there is no commercial MWI systemavailable today.

“The proposed prototype will be designed aroundthe patient experience to deliver a pain-free, safe andaccurate system. The novel clinical prototype targetedby this project will be first applied to breast cancerscreening,” said Themos .

The research will allow younger patients - aged 20 andover - to be screened as often as they wish and to bemonitored for a longer period of time, thus maximisingthe success rate for the early screening of cancer.

“This is an important benefit that is currently notavailable in a cost-effective, safe and sustainable mannerusing today’s technology. So we’re very happy with theprogress we’ve made so far. We’ve been very efficientwith the use of our funds and we look forward toreporting on our progress in due course,” said Themos.


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Interview withDr Phillip Howard,Chief Scientist,SpirogenSpirogen’s journey from nomadic researchunit to the forefront of antibody-drugconjugates (ADC) research has beenremarkable, but it also mirrors the careerof its Chief Scientist, Dr Phillip Howard.Following an undergraduate degree in AppliedChemistry in 1982 at Kingston Polytechnic, Howardcompleted a PhD at the University of East Anglia insynthetic chemistry, an area of research that even hedescribes as “very, very esoteric”.

After his PhD, Howard went to SmithKlineBeecham (nowGlaxoSmithKline) to conduct post-doctoral research innorth London. From there he moved to PortsmouthUniversity to work with Professor David Thurston who,since 1987, led the research into pyrrolobenzodiazepine(PBD), and John Hartley, now the Professor of CancerStudies at University College London (UCL).

Howard joined the team in 1993 to work on Spirogen’snow proprietary PBD molecule which, once attached toan antibody, can directly target chemotherapy at thetumour. These highly potent cytotoxic agents, or‘warheads’, attach themselves to specific cancer-targeting antibodies using biodegradable ‘linkers’. Thistargeting optimises the delivery of the cancer drug to thetumour cells only, and provides the greatest degree oftumour killing while minimising the toxicity to the patient.

Dr Phillip Howard, Chief Scientist, Spirogen.Ë

INTERVIEW

How did he make the leap from synthetic chemistry toworking on ADCs?

“My PhD was so esoteric that, whatever I did afterwardswas always going to be a huge leap. But what I’d alwayswanted to do was to work in pharmaceuticals and cancertherapy. Whereas my PhD was about how you madesomething, at SmithKline it was simply about just makingit. It was about using whatever chemistry you had at yourdisposal, using whatever’s going to work, to make thatmolecule. So that really broadened my horizons, it was areal education,” said Howard, who serves as DeputyDirector of the Cancer Research UK Gene Targeting DrugDesign Research Group.

Spirogen’s journey has been no less impressive. While thebulk of its research took place under Professor Thurston atthe University of Portsmouth, Spirogen was technically“founded” at the University of Nottingham, in conjunctionwith Cancer Research, or Cancer Research Campaign as itwas known then.

Thurston’s PBD research group moved to NottinghamUniversity in December 2000, but when Nottinghamaccepted £3.8 million in funding from British AmericanTobacco (BAT) for a new 'International Centre forCorporate Social Responsibility', the political fallout wasconsiderable.

News of the donation led to the resignation of Dr RichardSmith as Professor of Medical Journalism from the

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The bulk of Spirogen’s research took placeat the University of PortsmouthË

university. More crucially, Cancer Research cancelled a£1.5m fundraising appeal to replace out of date buildings,and Thurston announced that his research group wouldalso be making tracks.

Dr Chris Martin, an entrepreneur and chemical engineer,joined the team as Chief Executive around the same timeand Spirogen was born. Responsible for fundraising, itwas Martin’s commercial drive that culminated inSpirogen’s $200 million deal with MedImmune in 2013,and its entry into Astra Zeneca’s family of companies.

“It’s been a very exciting and fruitful collaboration withMedImmune. We’d worked with their scientists prior to theacquisition, so the deal has given us the opportunity tobroaden and deepen our relationship. We now work veryclosely with MedImmune’s scientists in Gaithersburg,Maryland, but also up the road in Cambridge,” says Howard.

Since the acquisition, Spirogen’s headcount has, give ortake, remained steady at 25. These include conjugationchemists specialising in joining the small molecule to theantibody, biologists to test the molecules, analyticalchemists to check that the molecules are doing what theythink they should. While in the early days it was all aboutthe chemistry, Howard concedes the biology nowrepresents the future side of the research.

“Most projects in big pharma companies are biologydriven, but in the early days of Spirogen it was reallydriven by what PBDs we could make. So for us, it was allabout the chemistry. Although the chemistry side of theresearch has been a constant, ever since our days atPortsmouth, our biological expertise from UCL has beeninvaluable, and it’ll become increasingly more so overtime,” said Howard.

Much of what Spirogen is working on is bound byconfidentiality agreements. However, what is in the publicdomain is that, through collaborations, it has two ADCscurrently in clinical trials. In December 2014, SeattleGenetics presented data from an ongoing phase 1 clinicaltrial evaluating SGN-CD33A, an ADC in development forthe treatment of acute myeloid leukaemia (AML), anaggressive type of cancer of the bone marrow and bloodwhich can progress rapidly without treatment.

“The Phase 1 trials we’ve seen at Seattle Genetics are veryencouraging,” said Howard.

Spirogen’s work saw them scoop Best ScientificInnovation at the World ADC Awards in San Diego inOctober 2014. The awards showcase excellence withinantibody drug conjugate research, rewarding innovation,leadership by companies, teams and individuals inthe industry.

ADCs are a massive game changer in how cancer istreated, potentially reducing and, in some cases,eradicating the need for chemotherapy and itsdebilitating side effects. To date, just two ADCs havebeen approved for patient use; ADCETRIS, for Hodgkinlymphoma and systemic anaplastic large cell lymphoma,received approval from the U.S. Food and DrugAdministration (FDA) in 2011, and T-DM1 (Kadcyla) forbreast cancer, in 2013. Yet there are currently 40 to 50new compounds in clinical development, meaning manymore ADCs could be on the market within five years.

Still, back when Professor Thurston and his team beganworking on PBDs, there wasn’t much of an appetite fromBig Pharma to get involved in ADCs, despite there beinga massive unmet clinical need. Howard says this wasprobably because the chemotherapy agents being usedwere so different from the mass market agents that weregenerally being used to lower cholesterol or controlstomach acid ph. What changed, he says, was afundamental change in biological research.

“Through biological research we’ve been able to developa much better understanding of the signalling pathways incancer cells, and that created targets which the bigpharmaceutical companies now feel they can go after.Now, whether its large, medium, small or even a start-upcompany, virtually all of them have got some applicationagainst cancer, and they’re all different strategies andideas. That’s so different from when I got involved,” saidHoward.

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London’s Life Science Sector has made greatstrides in the last 10 years, with millions of poundsspent in developing the capital’s scienceinfrastructure and capability. Ken Livingstone, the first London Mayor, used theLondon Development Agency as a delivery vehicleto create “BioLondon” as a brand, overseeing andcoordinating the creation of incubator space andgrow-on space in the capital, while Mayor Boris Johnsonoversaw significant change in governance of London’seconomic development landscape.

London now boasts state of the art business incubationand R&D space allied to world-class higher educationinstitutions and leading specialist teaching hospitals.But the prevailing mood in the industry is that thegovernment could be doing a lot more to realise thecapital’s scientific potential, tapping into the wealth ofexpertise already in London and making the city aworld leader in scientific research.

ChallengesThe next Mayor of London, from whichever political partythey come from, will have their work cut out when theytake up the position in May 2016. But the challengesfacing London are also similar to the challenges facingthe life science industry: a lack of funding, sky high rents,a paucity of affordable accommodation, a lack of spaceto grow an innovative business and training and retainingthe best and brightest people. QMB therefore asked apanel of experts: ‘what does the Life Science sector wantfrom the incoming Mayor?’

The event was part of QMB’s BioWednesday, and co-hosted with One Nucleus. It covered topics like theneed for commercial R&D space, an investment fundfor Life Sciences in London, tax incentives to encouragecompany growth and the coordinated promotion ofLondon’s Life Sciences offering.

To a packed house of industry professionals, One Nucleus’Tony Jones directed the questions at Ken Powell,Executive Chairman of reViral Ltd; Nigel Banister, Director,Science Developments Ltd; Professor Bill Spence, VicePrincipal (Research) Queen Mary University of London, andNigel Stokes, Managing Director at deltaDOT.

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EVENTSWHAT DOES THE LIFE SCIENCESECTOR WANT FROM THE NEWLONDON MAYOR?

Tony Jones asked the panel what the main issueswere facing the London Life Science sector and if itwas important for companies to retain a laboratorybase in London.

Nigel Banister said the main issue the sector faces inLondon is around finding space and securing funding.Banister noted that between 2005 and 2009 theLondon Development Authority invested around £40million in the London Life Science Sector, which wasmatched by another £40 million. But those days aregone, said Banister.

“We may have incubators which weren’t there in 2005but we still haven’t got space for the companies to moveout or move into, and it will now be even harder to solvethe [capacity] problems facing the sector under thepresent economic climate,” said Banister, who was theHead of Science and Technology for the LondonDevelopment Agency and responsible for creatinginvestment programmes to boost business growthfrom London’s knowledge base.

UniqueHe added that London is unique in terms of the UK inthat it is the only region where there is more universityresearch than business research.

“The scale of the university research in London is biggerthan Oxford and Cambridge and those surroundingareas put together,” said Banister.

Ken Powell, Executive Chairman of reViral Ltd, said thatwhile space was an important issue, the biggest problemfacing the sector in London was finding the right peopleto launch a life sciences business.

“While it’s limited, there’s always space, it’s just a matterof persuading somebody to give it up. But that’s not thebiggest problem. The big problem is actually gainingaccess to the kind of entrepreneurial energetic, youngscientific staff that you need to get companies going,”said Powell, who has set up several companies over theyears and was the Founder and CEO of ArrowTherapeutics, a specialised antiviral drug discoverycompany which was sold to Astra-Zeneca PLC in 2007for USD$150 million.

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Powell said the new Mayor needs to make education andentrepreneurship training a top priority when he takes uphis role in May 2016.

“What we need is more entrepreneurship training.A lot of people would say you can't train entrepreneursbut we have an awful lot of redundant chemists andbiologists who, with the right training, could be the seedstock for a new realm of biotech companies. It happensin the US, why doesn’t it happen here? Why don’tpeople think they can set up their own company anddo it?” said Powell.

“What I would ask the Mayor to do is to look ateducation. Why do we have the silicone roundaboutphenomenon in London? Does it have anything to dowith politicians? Well, actually no, nothing at all. Kids dowhat they want to do, and right now it’s about computerdesign and innovation in ecommerce,” Powell said.

Queen Mary University’s Bill Spence said there areopportunities around proof of concept grants andfunding, but universities’ hands are restricted in wherethey can put their money, which makes any initialinvestment difficult.

“Universities can pull resources into that but they’reunder a lot of pressure at the moment to put resourcesinto student support. And, in the sense, the students arepaying for their education, they’ve got to have decentresources and high quality education, which is perfectlyright. So it’s hard for universities to divert large sums ofmoney into some of these concepts. We try but it’s notenough to really make any difference,” said Spence.

Tony Jones asked if the new Mayor should explore thepossibility of a strategic investment fund similar to the£10 billion megafund announced by Mayor Boris Johnsonin June to encourage the growth of emerging health-carecompanies in the U.K. in an effort to catch up with thebiotechnology clusters in the U.S.

“That would be fantastic but I wish he’d start with a£1 billion investment fund and then move on to the £10billion. I think it’s just a headline. Sadly, I don’t honestlyever believe that it will ever materialise,” said Banister.

Nigel Stokes said the hefty business rates seen inLondon could be put to good use under new legislationannounced in October which will allow councils inEngland to keep the £26 billion raised from businessrates through devolving political power from Whitehallto local government.

“There could be an opportunity for the new Mayor toknock a few heads together, particularly in the centralLondon boroughs, and say: look, you're going to losethis money unless you can come up with something todo with it. And it could be that is the way of fundingfacilities and accommodation for life science personnel,”said Nigel.

He added: “The strategy of the Mayor has always beento support Life Sciences as an alternative model tofinance in London. And that’s a bold aspiration. So if hewants to do something positive, the next Mayor shouldgrab this money and do something with it.”

Sajid Javid invites applications toconduct science and innovation auditsacross the country.We’ll soon have a clearer idea of what scientific know-how we have, as Business Secretary Sajid Javid recentlyunveiled plans for a new national panel of innovationexpertise alongside a regional review of the UK’s sciencecapabilities.

Speaking at Innovate UK’s Annual Conference, theBusiness Secretary explained that the national panelwould help to direct funding to improve the outcomeof investments in innovation.

He also invited applicants from across the country toconduct science and innovation audits for their region.These audits will map research and innovation strengths,highlight areas with competitive advantages and providean evidence base for decisions about innovation.


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The research community was braced for bad newsin November’s Spending Review, but it nevercame to pass. With the unprotected Departmentfor Business, Innovation and Skills (BIS) expectedto face severe cuts, the announcement of a 17 percent cut was less than many feared. GeorgeOsborne then followed this with a commitment toprotect the budget for science “in real terms so itrises to £4.7 billion.”Other research-related announcements in thespending review include:

• A new £1.5 billion Global Challenges fund to ensureUK science takes the lead in addressing theproblems faced by developing countries;

• £5 billion invested in health research anddevelopment, as well as up to £150 million tolaunch a Dementia Institute and a new £1 billionRoss Fund, partnered by the Bill and Melinda GatesFoundation;

• A Global Antimicrobial Resistance Innovation fund,to be launched in partnership with China;

• £250 million for the 100,000 Genomes Project tointroduce whole genome sequencing technology inthe NHS;

• Innovate UK will be brought into the new ResearchUK umbrella body and some existing Innovate UKgrants will be replaced with loans, to reach £165million per year by 2019-20, so that total support ismaintained in cash terms;

• A reaffirmed commitment to long term sciencecapital investment of £6.9 billion between 2015-2021;

• Taking forward the recommendations of Sir PaulNurse’s independent review of the research councilswhich, subject to legislation, will introduce a newbody – Research UK – which will work above andacross the seven Research Councils;

• In addition, government will initiate a review of theResearch Excellence Framework in order toexamine how to simplify and strengthen funding;

• No further announcements on departmental R&D,despite plans for this in the Government’s 2014Science and Innovation Strategy.

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The move is the next step in plans to make Britain thebest place to innovate in Europe. The government hascommitted to invest almost £7 billion in science capitalup to 2021. However, Javid is said to be consideringconverting some or all of Innovate UK’s £600 millionannual budget into loans. If he presses ahead, it is fearedthat companies might move elsewhere in Europe wheregrants are still available.

Javid said: “The UK is embracing new technologiesand leading the world in innovation, but we must not becomplacent and must look to the long term future ofresearch and development to support our jobs andindustries.

“As a one nation government we want every region ofthe UK to maximise opportunity for its local peoplethrough its innovation strengths, and the new scienceand innovation audits will ensure that public investmentis doing just that. By taking stock of our assets andsupporting best practice and expertise, we will propelthe UK to the forefront of the global innovation race.”

The Business Secretary also revealed plans for a newSmart Specialisation hub, which would see experts,businesses, universities, investors and Innovate UK’sCatapult networks working together to share bestpractice.

Jon Rees, CEO at OBN said: "Taken together, thepublic markets and venture financing data combineddemonstrate the resurgence of financing in UK lifesciences. However, the relatively small proportion raisedfor enterprise financing rounds strongly supports thecase for continued financing mechanisms to supportinnovative R&D firms through the equity gap, such asthe Biomedical Catalyst. Nevertheless, OBN welcomesthis banner year for UK life sciences."

Jim Mellon, entrepreneur and fund manager said:"This latest research confirms the record year that we arehaving in the life sciences sector. Building on the veryhigh levels of mergers and acquisitions we've seen in ourexisting fund, these new funding rounds will give us manymore companies to look at as potential investments forour new fund."


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ROUND-UPLIFE SCIENCES M&ASEES NEW HEIGHTS IN 2015This year we have seen record-setting activity in boththe frequency and value of M&A deals involvingpharmaceutical companies, and in the Life Sciencessector in general.

According to a report published byPricewaterhouseCoopers, the combined value of closedM&A deals in the Life Sciences and PharmaceuticalSectors surpassed USD $320bn in the first three quartersof 2015.

Indeed, US drugs giant Pfizer Inc recently agreed a dealto buy Botox-maker Allergan PLC for $160 billion (£103billion), making it the biggest pharmaceuticals deal inhistory. The merger will see the company renamed PfizerPLC to create the world's biggest drug maker by sales.

The takeover will also be the largest inversion ever. Suchdeals enable a U.S. company to move abroad – in thiscase Dublin - to take advantage of a lower corporate taxrate elsewhere, and have remained popular in the faceof U.S. efforts to curb them.

Last year, Pfizer made an offer to buy UK drugs groupAstraZeneca, which rejected the offer, arguing itundervalued the company.

Pfizer boss Ian Read will be Chief Executive andChairman of the merged company, with Allerganboss Brent Saunders becoming president and chiefoperating officer.

"The proposed combination of Pfizer and Allergan willcreate a leading global pharmaceutical company withthe strength to research, discover and deliver moremedicines and more therapies to more people aroundthe world," said Mr Read.

The merger will create a pharmaceutical behemoth,with top-selling products including Pfizer’s Prevnarpneumonia vaccine and Allergan’s anti-wrinkle treatmentBotox and industry-topping R&D budget. The company’sdrugs and vaccines would cover a range of diseases, fromAlzheimer’s to cancer, eye health to rheumatoid arthritis.

The deal brings together two pharmaceuticalpowerhouses with more than $60 billion in combinedsales. Last year, Actavis, which bought Allergan and tookits name, had more than $13 billion in sales, while Pfizerhad nearly $50 billion in revenue.

A finalised deal would be the latest in a series of mergersand acquisitions in the sector, as pharmaceuticalscompanies struggle to cope with patents on a number ofmajor drugs expiring, while a better understanding ofgenetics and disease has led to more targeted medicineswith a smaller market.

Against this backdrop, Biopharm Insight andMergermarket recently issued a report titled “Life lines:Life-sciences M&A and the rise of personalisedmedicine.”

Record-setting activity of M&A deals.Ë

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The report surveyed 100 senior executives (CEO,CIO, Director of Strategy) in biotechnology andpharmaceutical companies across the US (34%),Europe (33%), and Asia (33%). The representation bycompany size was $100m-1bn (34%), $1bn-5bn (33%)and $5bn+ (33%).

Based on their research, the survey concluded:Focus on Asia: 28% of those surveyed indicated thattheir next acquisition was most likely to target an Asiancompany, 19% of respondents indicated intentionsto acquire companies based in North America andWestern Europe.

Drug discovery/R&D and diagnostics in demand:Over 70% of respondents indicated drug discovery, earlystage R&D, and a focus on diagnostics as the factorsmajor pharmaceutical producers will most likely look forwhen selecting candidates for acquisition.

Personalised medicine on the rise: 26% of respondentsindicated that they saw an opportunity to charge higherprices for more targeted drugs, and 24% suggested thatpersonalised medicines allowed them to make moreconvincing cost-benefit cases to buyers thanconventional pharmaceuticals.

Brain drain: 69% of respondents cited the monetarycosts of retaining high-level scientific/R&D expertise as amajor challenge in sustaining a broad drug portfolio, and56% indicated their ability to maintain and supportmultiple specialist sales teams as a chief concern.

The report concludes that, partially due to the favourablefinancial climate, the M&A boom in life-sciences is likelyto continue, and that the volume of deals in 2015 is ontrack to surpass last year’s results. However, the report’sauthors also advise caution. The shape of the life-sciences sector of tomorrow remains unclear, regulatoryregimes in key markets are likely to see change, andmany survey respondents indicated that they wereanxious about economic and political uncertainty.

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QMI files patent forbiomarkers in detectionof pancreatic cancerQueen Mary Innovation (QMI) has filed a patentapplication for the detection of pancreatic cancer.Dr Tatjana Crnogorac-Jurcevic and her colleagues haveidentified three novel biomarker proteins that have shown tobe associated with earlystage pancreatic cancer in a urine-based test, with more than 90% accuracy.

Pancreatic cancer is associated with poor prognosis.If pancreatic cancer is diagnosed at Stage 1 the survival ratefor tumours can be up to 60% yet currently only 6% survivebeyond 5 years due to the fact that that there are usuallyno early warning symptoms of the disease and reliablediagnostic tests do not yet exist. When diagnosed, themajority of patients display locally advanced disease orhave established metastases and so surgery is possible inonly 10-20% of patients.

Dr Tatjana Crnogorac-Jurcevic and her colleagues publishedthe study in the ‘Clinical Cancer Research’ journal (1 August2015). The researchers analysed 192 urine samples frompatients with pancreatic cancer, alongside 92 samples frompatients with chronic pancreatitis and 87 samples fromhealthy individuals. The team also assessed 117 additionalsamples from patients with other benign and malignanthepatobiliary conditions.

The team identified around 1,500 proteins in the urinesamples. Three of these - LYVE1, REG1A and TFF1 - werefound at significantly higher levels in the urine samples ofpatients with pancreatic cancer, compared with the samplesfrom healthy individuals.

Patients with chronic pancreatitis, however, had much lowerlevels of all three proteins in their urine than patients withpancreatic cancer.

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