Road Map for Reduced Risk Biotech StartUps Dubai

Road Map for Reduced Risk Biotech Start-Ups Dubai Bio Expo - 2015 November 2, 2015 Louis Herlands, Executive Director Sidra Ventures Sidra Medical and Research Center, Qatar

Sidra Medical and Research Center Engaged in cutting edge research in tumor immunology, genomics, systems biology, stem cells Provides translational research infrastructure to foster advanced and integrated research relevant to national research priority Sidra Ventures is the commercialization & innovation arm of Sidra Research Helping catalyze creation of biotech industry

Clinical Genomics Core Facility: Sequencing Capacity Ten Hi. Seq X Ten sequencer platform Capacity (per month): 1000 -1500 Human Whole Genomes 1500 Exome or deep transcriptome seq Human Reference Genome sequencing and assembly Hi. Seq 4000 Next. Seq 500 Mi. Seq. Dx Pac. Bio RSII Sanger Sequencer Oxford Nanopore

OUTLINE: Road Map for Reduced Risk Biotech Start-ups Rationale: why is this topic important? Key questions Examples of successful companies, and what we can learn from them? What can we learn from failures? Elements of a successful biotech companies Proposed road map

Biotech Start-up Basics TECHNOLOGY LICENSING EXIT First POP Trial in Humans Simplified Model 6 RECRUIT TEAM $$$

I. Rationale In the GCC, the biotech and pharmaceutical industry is poised to play an important role in the diversification of the economy and start-ups or early stage companies can play an important role. Failure rate for biotech start-ups is high ( >90%) What are strategies for reducing risk and increasing the likelihood of success?

II: Key Questions What are certain successful biotech companies doing right? How can we learn from them? How is risk reduced by these successful companies? Can we do the same? As investors, fund managers, or CEOs how can we pick the successful companies at the earliest stages?

Principia & Biorexis: Reduced Risk product candidates - Improved versions of biologics through fusion proteins • Albumin fusion proteins increase plasma half life and allow sustained exposure therapeutic • Second generation biologic • Examples: • Albumin fusion proteins (Principia) • Transferrin fusion proteins (Biorexis) Albinterferon -2 b: a genetic fusion protein for the treatment of chronic hepatitis C G Mani Subramanian, Michele Fiscella, Araba Lamousé-Smith, Stefan Zeuzem & John G Mc. Hutchison Nature Biotechnology 25, 1411 - 1419 (2007)

Principia Pharmaceuticals: What did they do right? • • • Driven industry-savvy senior leadership team Strong scientific team with industry experience that are agile and focused on IP True platfrom technology: Reduced risk product candidates that meets large unmet medical needs Strong IP portfolio Judicious use of $ invested to reach significant value creation milestones: (i) generated high quality compelling non-clinical data package • Operational excellence: high quality work & aggressively meet deadlines on time & budget • Leadership compelling enough to convince investors and strategic partners • VC investment syndicate dialed in exit (but, limited upside for co-founders. Acquired by Human Genome Sciences ~12 months after formation for $120 million

Oraltech Pharmaceuticals: What did they do right? How did they blunder? Oraltech’s lead product candidate was a Pan-Cox oral rinse • STRONG MANAGEMENT, LUMINARY SAB MEMBEMBERS & DIRECTORS • Strong Scientifically • Treatment of Intraepithelial Neoplasia – not chemoprevention • Reduced risk product candidates that meets large unmet medical needs that represent large markets • Clinical stage product candidate • Strong IP portfolio, new use for old drug • Oral health & ‘chemoprevention’ not an attractive area for investors & pharm • DID NOT RAISE ENOUGH MONEY FOR CONTINGENCIES • Weak clin/reg strategy – difficult indication, heterogeneous patient population • INVALID NCI clinical trial COULD HAVE BEEN A SUCCESS BUT: INABILITY TO RAISE CAPITAL TO REPEAT TRIAL

Reduced Risk product candidates II: Local Delivery 1. Nasal Delivery to deliver medicines to the brain • Gets the medicine to where it is needed • Minimizes systemic exposure • Avoids fist pass metabolism • Bypasses blood brain barrier 2. Oral rinses to deliver to mouth & gums • 20 -50 X higher concentration in gingival crevicular fluid (GCF) than peak plasma • Minimizes systemic exposure • Gets the medicine to where it is needed

Platform Technology Science 28 November 2014: Vol. 346 no. 6213 1258096

Proposed framework towards a reduced risk biotech 3. FINANCING 1: LEADERSHIP TEAM 2: PRODUCT CANDIDATES INTELLECTUAL PROPERTY 14

ROADMAP: 1. LEADERSHIP TEAM “We bet on the jockey, not the horse” Driven obsessive leadership Track record of success Suboptimal to learn on the job Diverse skill set required

2: PRODUCT CANDIDATES: Criteria Strong Intellectual Property Meets unmet patient need in large market Platform Technology or Product Portfolio Well trodden clin/reg path Reduced Risk Strategies Most product candidates fail for reasons of safety New indications for old molecules Improved versions of existing products Local delivery

3: FINANCING STRATEGIES Investments from strategic partners Non-dilutive capital Avoid VCs, if possible Be realistic about valuations Don’t worry about dilution Investors who will participate in future financing rounds Gain early access to public markets, if possible

Gap Fund ‘Proof of Principle’ studies required to demonstrate commercial potential are rarely conducted by academic institutions, due to the lack of expertise and established funding mechanisms for this purpose. This often results in a development gap between early-stage academic invention and the validation required to attract the participation of the private sector. Gap Funds are increasingly becoming implemented and there are numerous examples: Rockefeller University Robertson Fund Boston Children’s Hospital Technology Development Fund Partner’s Innovation Fund http: //innovation. partners. org/investors_and_entrepreneurs/partners_innovation_fund The vision of Sidra Technology Ventures is to help bridge this gap by providing funding to generate more data including non-clinical and ‘proof of principle’ studies that adequately demonstrate the invention’s promise and potential and support patent application filing.

Summary Slide • • • INTELLECTUAL PROPERTY PRODUCT CANDIDATES LEADERSHIP Driven, obsessive leadership Track record of success “We bet the jockey, not the horse” • Meets unmet need in large markets • Platform technology or Portfolio of product candidates • Reduced risk strategies • Well-trodden clin/reg path • • Strong IP Portfolio Preferably composition of matter patents FINANCING • Investment from strategic partners • • • Avoid VCs if possible • • Don’t worry about dilution • Gain early access to public markets, if possible Non-dilutive capital Be realistic about valuations Investors who will participate in future rounds Maximizes likelihood of having a successful company 19

Take Home Messages • In-licensing value high technologies is a viable approach to jumpstarting start-ups • What was presented today are ideas for consideration that will need to be modified or adjusted to specific conuntries in the MENA region to reflect available resources If you have any questions Please contact me: Louis Herlands, Ph. D Executive Director Sidra Technology Ventures lherlands@Sidra. org

CONVERGENCE OF DISRUPTIVE INNOVATION IN BIOTECHNOLOGY DNA Sequencing CRISPER Cas 9 MICROBIOME & METABOLOMICS PRECISION MEDICINE GENE THERAPY Systems Biology CANCER IMMUNOLOGY 21 *

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