Aisling, Clarus Crown Old Funds With Huge Royalty Deal

When was the last time a life sciences venture firm spent $50 million all in one go? It doesn't happen often. But in the past week, two firms did exactly that. Aisling Capital and Clarus Ventures announced Monday that they've each put up $48.5 million for a tiny slice of sales royalties from ibrutinib, a promising cancer drug that could receive FDA approval this calendar year or early next.

The firms joined Royalty Pharma to buy the ibrutinib royalty rights from Quest Diagnostics for $485 million, a deal first announced in mid-July without details of the VCs' involvement. (Quest obtained the rights when it bought Celera in 2011 for its diagnostics business.)

Royalty deals are happening more often, as we noted on this blog earlier this year, but this was an unusual deal for Royalty Pharma – and would be for any royalty fund – because the drug is not yet approved. Royalty investors, firms which pay up-front cash to scientists, institutions, biotechs and pharmas for royalty rights that they collect over time, don’t typically risk regulatory failure on top of commercial uncertainty. But Royalty Pharma has been more creative of late, even making an acquisition play for Elan Corp that was ultimately unsuccessful.

Royalty Pharma brought in the VCs to share the risk and to help assess regulatory and commercial uncertainties in the hematology-oncology space. (Clarus has people, including managing directors Nick Simon and Dennis Henner, PhD, who were executives at Genentech in the Rituxan era.)

For the VCs, investing from the end of their current funds with an eye toward new fundraising, it’s a less risky investment than they and their brethren are accustomed to. Sponsored by Pharmacyclics and Johnson & Johnson, ibrutinib has received “breakthrough” status from the U.S. Food and Drug Administration in three patient settings: chronic lymphocytic leukemia with a deletion of the chromosome 17, relapsed/refractory mantle cell lymphoma and Waldenstrom’s macroglobulinemia.

Even if ibrutinib garners multi-billion dollar sales at its peak, will it bring venture-like returns to Clarus and Aisling? Royalty Pharma officials recently told "The Pink Sheet" DAILY that the royalty stream they bought from Quest is in the mid-single digits as a percentage of total ibrutinib sales. We don’t know the exact number, so let’s call it 5%. Clarus and Aisling have each bought 10% of that stream; let’s call it 0.5% of total sales apiece.

Under that scenario, it will require nearly $10 billion in ibrutinib sales for each firm to recapture its investment; more than $19 billion to double it, and $29 billion to capture a “venture-like” 3x return.
Even by optimistic projections – last month, Barclays Capital estimated peak annual sales for ibrutinib between $2 billion and $3.6 billion, others have gone higher -- it will take years to reach those totals.

But the ibrutinib scenario could play out – and pay out – in two different ways. First, if ibrutinib is approved, the VCs will at least have a steady stream of returns to pass through to their LPs as soon as sales begin. Such near-term returns, however incremental, would be far less likely if each VC spread its $50 million among a few earlier-stage biotech companies or other investments.

Second, if ibrutinib is approved, the value of the royalty stream could jump. There are other investors, including other royalty funds, that don’t take pre-commercial risks. Eliminate those risks, and perhaps Clarus and Aisling could flip their royalty rights to new buyers. Aisling senior managing partner Dennis Purcell and Clarus’s Simon acknowledge both scenarios. “It certainly factored into our thinking,” says Simon. “We can hold for the entire the royalty period, and we also have the option to sell at some point once adoption of the drug establishes real commercial value.”

Seeing how Clarus and Aisling both are investing from the tail end of funds closed in 2008 and 2009, respectively, we'll speculate that there's a good chance this deal becomes, well, royalty speculation. We don't know the internal goals for the funds, but if ibrutinib is approved and buyers emerge, we wouldn't be surprised to see a flip of the rights for something less than a "venture-like" 3x return. As  Purcell notes, a big part of the venture equation these days is shortening the time from investment to liquidity.

Even with their big ibrutinib outlays, Clarus and Aisling say there's a little gas left in the tank for their current funds. Purcell says his group hasn't yet begun talking to LPs about raising a fourth fund, while Simon says Clarus is "actively contemplating" a third fund.

- Paul Bonanos contributed to this report. For more analysis of this deal and other avenues VCs are taking to find lower-risk returns, see our upcoming issue of START-UP.

Photo courtesy of flickr user Jodimu.

Deals Of The Week: Isis Rethinks Its Partnering Strategy

 

In its last few earnings calls Isis Pharmaceuticals Inc. has touched on a significant change in its partnering strategy. We spoke with CEO Stan Crooke recently to better understand the implications of these changes for Isis’s top line and operating expenses, and also how they might allow the antisense specialist to enter into more strategic relationships with a few well-chosen partners. 

Isis has been on a deal tear. It out-licensed 5 candidates in 2012, striking three of those deals with Biogen Idec Inc., according to Elsevier’s Strategic Transactions Database. Since 2008, it has collected over half a billion dollars in upfront cash, and hundreds of millions more in milestone payments, not to mention $175 million on the sale of its satellite subsidiary Ibis Biosciences Inc. to Abbott Laboratories Inc.

The new approach was enabled by the size and renewability of Isis’s pipeline – some 28 antisense compounds in clinical development, and about seven in preclinical – and also by recent improvements in antisense technology that have raised the value and attractiveness of Isis’s assets and allowed it to pursue targets in a broad array of diseases including larger population diseases.

Isis puts its candidates into three buckets. The first bucket includes drugs in indications where there’s high target risk and costly and inconclusive Phase II studies.  Its goal is to partner these assets early, sometimes during preclinical development, in option deals where Isis controls development through Phase I or II. Recent agreements in neurology with Biogen (spinal muscular atrophy) and Roche (Huntington’s disease), and in cancer with AstraZeneca PLC (various tumors), conform to this model.

The second bucket is for drugs in indications where Phase II studies are dispositive and predictive of Phase III success, but where Phase III programs are very expensive and complex – for instance, due to a requirement for cardio outcome studies. These indications, typically metabolic disorders or certain cardiovascular diseases, have large patient populations and require a significant commercial effort. Isis’s unpartnered candidates against targets involved in insulin resistance, lipid control, fat metabolism, clotting disorders and coronary artery disease fall in this bucket. “Because we’ve kept them longer, through Phase II proof-of-concept, the terms are more lucrative,” said Crooke.

The third bucket signals the greatest change in Isis’s partnering strategy. From the firm’s founding in 1989, it has focused primarily on partnerships in which it had limited financial flexibility and where its partner controlled development. Beginning around 2010, Isis began to strike deals where it retained developmental control through early and mid stages, and generally took a bigger payment, both upfront and in milestones and royalties.

This third group comprises drugs in indications with clear Phase II and Phase III clinical paths, low-to-moderate total development costs, and the potential for initial rare disease opportunities, with larger-population indications downstream. Crooke said Isis is looking for “a Phase III program that we think we can manage without growing the organization enormously.” In fact, Crooke said Isis may hold onto candidates in the third bucket partway or all the way through Phase III.

The company might even control some drugs through filing, though he conceded that the timing would get tricky. The art is to partner early enough so that the licensee can prepare for launch, but late enough to maximize the value of the asset. Deals over Phase III assets might include a one-year option, though Crooke said he and his team are still evaluating different deal structures.

The first experiment in Phase III out-licensing will be ISIS-APOCIIIRx for patients with high triglycerides; its Phase III trial is slated to begin next year. The Kynamro (mipomersen) deal with Genzyme Corp., in which Isis took $325 million in upfront cash and equity for an asset it had funded through Phase II, may have woken it to the commercial opportunity of holding drugs longer, particularly ones that play out in multiple indications. But where mipomersen’s Phase II trial had to be funded via a private placement and an innovative financing with Symphony Capital, Isis is no longer cash-constrained and will have no trouble managing the late-stage development program for APOCIIIRx and other appropriate candidates. Similar deal terms and a big pharma partner are likely if Isis is successful in licensing APOCIIIRx.

The new deal strategy calls for Isis to crank out three to five drugs per year. At that rate, said Crooke, it will need to grow the organization a bit. And R&D spending, which has until now been relatively stable, will begin to rise as it moves drugs forward faster and retains some into Phase III.

But the river of cash that will be generated by Isis’s numerous existing deals – upfronts, milestones, licensing fees, royalties – should easily cover the costs. Its cash hoard, announced at its August 6 second quarter earnings call, is $590 million. The money will also make possible the next iteration of Isis’s partnering strategy. “What we look forward to in the future,” said Crooke, “is a few strategic partners where we’ll have a partner in a specific space who really knows us and the technology. And we know the partner and what we’re getting.”

Clear sailing, then, as long as the deals keep coming in. However, 2013 has seen a pause in the torrid pace of Isis’s deals. So far into the year, it has struck only the Roche agreement in April.

Still, all that cash set to pour in, and all those changes in the way it does business development, could nudge Isis to rethink its platform business model.  We’ll be examining that possibility in an upcoming issue of IN VIVO. - Mike Goodman

Until then, here’s what the rest of the biopharma world has been up to, deal wise . . . 

Novartis/Ensemble Therapeutics: Building on its research into the inflammatory cytokine interleukin-17, Novartis AG has partnered with Ensemble Therapeutics Corp. to develop an oral small molecule targeting the pathway. The big pharma is one of the leaders in this field of research and has a biologic drug that blocks IL-17, secukinumab, poised for a near-term regulatory filing for the treatment of psoriasis. Several competitors are also looking to bring similar drugs to market, and an oral alternative would represent a compelling commercial opportunity. The terms of the discovery-stage deal, announced Aug. 5, were not disclosed, though it will include an upfront payment, milestones and research funding payable to Ensemble.  For the private drug discovery company, the deal involves its latest-stage asset.  Much of the value of its macrocycle discovery platform, from which it has built a library of more than five million synthetic macrocylic compounds called Ensemblins, is at an early stage. The orally available compounds permeate cells like small molecules do, but like biologics, also bind to protein targets. The company has partnered with several other pharmas including Pfizer Inc., Bristol-Myers Squibb Co., Genentech Inc., Boehringer Ingelheim GMBH and, most recently, Alexion Pharmaceuticals Inc.- Jess Merrill

Bayer/Compugen: Israeli drug developer Compugen Ltd.  landed a drug development deal with Germany’s Bayer AG for two potential cancer treatments whereby the Tel Aviv-based biotech will get an upfront payment of $10 million and could get more than $500 million in milestone payments, not including milestone payments of up to $30 million for preclinical activities, plus royalties on resulting drug sales. Compugen, which has a pipeline of preclinical protein therapeutics and monoclonal antibodies, uses predictive discovery technologies to discover antibody therapies that use the body's natural immune defenses to fight tumors. The NASDAQ-listed biotech’s computational platform uses algorithms to predict which surface membrane proteins could be used as antibody drug targets; these are later validated in the laboratory. The collaboration, announced Aug 7, will focus on two novel immune checkpoint regulators that may play a role in immunosuppression.  Its scientists are developing specific therapeutic antibodies geared to block the immunosuppressive function of these targets and to reactivate the patient's anti-tumor immune response. It’s an area that is drawing increasing attention from drug makers. Compugen depends to a large degree on partnerships to progress its R&D program. Under its latest arrangement, Bayer will get control over further development and global commercialization rights to any new antibody-based cancer immunotherapies the collaboration generates. - Sten Stovall

Oncobiologics/InVentiv Health: N.J.-based Oncobiologics Inc. has entered into a risk-sharing agreement with contract research organization inVentiv Health Inc. in an effort to move its biosimilars pipeline forward. Oncobiologics is a small privately-held company, founded in 2011, that has relied on government grants, partnering opportunities, and angel investors for funds. It currently has no drugs in the clinic, but has several preclinical biosimilars and three innovative molecules still in discovery. The two companies will collaborate to develop five biosimilars, beginning with a generic version of AbbVie Inc.’s blockbuster rheumatoid arthritis drug Humira (adalimumab). The collaboration will involve biosimilar versions of four oncology drugs, including Roche/Genentech Inc.’s Rituxan (rituximab), Bristol-Myers Squibb Co./Eli Lilly & Co.’s Erbitux (cetuximab), Roche/Genentech’s Herceptin (trastuzumab), and Roche/Genentech’s Avastin (bevacizumab). inVentiv will share the cost of Phase III development. Oncobiologics was founded by individuals with business, R&D, and process engineering experience in the biologics divisions of major pharma companies. The firm intends to find commercialization partners in the U.S., Europe, and emerging markets, and has struck several deals to that end, but will work with inVentiv to commercialize the products in any territories without partnership agreements. inVentiv’s share of the profits will be dependent on its involvement in those unpartnered territories. Financial details of the transaction were not disclosed.- Lisa Lamotta

Amgen/Array: In this week’s “No Deal,” Amgen Inc. will return glucokinase activator AMG 151 to original owner Array BioPharma Inc., ending a December 2009 collaboration in which the companies jointly studied type 2 diabetes drugs. The tie-up officially unravels October 5, when rights to AMG 151 will revert to Array. Boulder, Colo.-based Array revealed the deal’s termination along with second-quarter earnings on August 7. The Phase II candidate, originally and henceforth known as ARRY-403, was the centerpiece of a deal that netted Array $60 million up-front. Array also received an $8.5 million milestone payment during the life of the deal, which included an additional $658 million in unrealized payments. The collaboration included a two-year research agreement that ended in 2011. The deal was forged when ARRY-403 was still in Phase I. Since then, some doubts have arisen that glucokinase activators can produce sustained glycemic improvement, while further risks of hypoglycemia and increased blood pressure have cast doubt on the drug class’s future in diabetes. Moreover, both companies have replaced their CEOs in the intervening years, and Amgen research and development head Roger Perlmutter has moved on to Merck & Co. Inc. The companies recently completed a Phase IIa study of the drug, and plan to share its results with the scientific community, according to an Array statement. - Paul Bonanos

Financings of the Fortnight Gets Comfortable In Genes

Twenty-three years after the first gene therapy clinical trial began, investors are finally showing confidence in the sector. The field still isn’t without risks, but some of its most daunting challenges are being resolved as clinical data broadens, regulators show support, and manufacturing improves.

The promise of gene therapy, which entails replacing a malfunctioning gene with a properly functioning copy delivered by a viral vector, is that its treatments are administered once with long-lasting, potentially curative results. That has tantalized scientists since the first gene therapy trials began in 1990, even as clinical research endured a standstill in the early 2000s after the deaths of several trial subjects. Their first big payoff came late last year, when European regulators approved uniQure’s Glybera (alipogene tiparvovec) to treat the rare disease lipoprotein lipase deficiency.

Since April, VC syndicates have backed two new companies studying new gene therapy treatments. First, Novartis Venture Fund, Abingworth, Versant Ventures and Index Ventures committed €32 million ($41.4 million) in GenSight Biologics’ springtime Series A round. Then Versant doubled down last month, contributing to Audentes Therapeutics’ $30 million Series A alongside OrbiMed Advisors and 5AM Ventures. Ophthalmological treatment developer GenSight and muscle-wasting specialist Audentes join a field of private companies that includes Celladon, Finland’s FKD Therapies, and uniQure.

More notably, gene therapy developer bluebird bio took advantage of the appetite for biotech listings in June, blowing past expectations with a $116 million IPO. In the aftermarket, bluebird shares touched $35, more than double their opening value; they currently trade above $27, giving the company a market capitalization of about $620 million.

Why has interest been renewed? “In terms of the investment community, the barriers to gene therapy as a therapeutic modality are being erased,” Celladon CEO Krisztina Zsebo told “The Pink Sheet” last month.

The body of evidence has grown significantly since 2006, with proof-of-concept shown across a variety of diseases. The manufacturing process has been industrialized and, while still expensive, occurs at a scale that appears sustainable. And in the wake of Glybera’s approval overseas, U.S. regulators have revised their guidance for clinical trials on therapies, suggesting cautious procedures but implying a willingness to approve a product when the time is right. It may be soon, as uniQure pursues Stateside approval.

It’s not just investors getting into the act. Several pharmas have their own programs, and others are striking high-profile deals. Celgene paid bluebird $75 million up-front in May, as the two inked a cancer research partnership, while uniQure teamed with Chiesi Farmaceutici for a territorial rights deal. Novartis and Boehringer Ingelheim have also licensed vector-related technology that could lead to new products as well.

Some risks are still very present. Many therapies pose a danger of “insertional oncogenesis,” the accidental triggering of a nearby gene that leads to cancer, although the vectors most commonly used today (adeno-associated virus and Lentivirus) are believed to be safer than the ones that led to patient deaths more than a decade ago. For now, the trailblazing companies are mostly operating in rare-disease fields where alternatives are scarce; as data sets grow, the treatment modality could soon be used in broader areas.

And although bluebird’s investors have reached liquidity, it’s tough to assess the value of gene therapy companies because of unresolved questions around product pricing. uniQure appears to be targeting a price of €1.2 million ($1.6 million) per injection, payable over a period of five years. That could induce sticker shock, but Versant venture partner Tom Woiwode argues that it’s quite reasonable, since a single, potentially curative treatment could ultimately cost less than a lifetime of chronic pharmaceutical use.

In the longer term, it’s also unclear whether gene therapies will really be permanently curative, or will need to be re-administered periodically. Moreover, a handful of early successes in rare diseases won’t necessarily carry over to more widespread disorders. Payer relationships haven’t yet been established, nor is there a precedent for a high-priced, one-time treatment before uniQure’s market entry. But each additional step offers a little more clarity for investors willing to risk their money on a treatment modality that holds so much promise.

We can't promise you, dear reader, a curative therapy, but if you don't mind a biweekly dosing schedule, we're always happy to bring you...

Edimer Pharmaceuticals: The tiny Cambridge, Mass. firm said July 30 it has raised an $18 million Series B round to test its protein replacement therapy EDI200 in newborns with X-linked hypohidrotic ectodermal dysplasia (XLHED), a rare genetic disease that can lead to fatal hyperthermia, as well as loss of hair and teeth in older patients. The Phase II trial, scheduled for six to ten newborns, comes on the heels of a Phase I trial in adult patients. The final data are still under analysis, Edimer CEO Neil Kirby told our Pink Sheet colleagues. Kirby is unsure what Edimer’s strategy will be for Phase III if EDI200 is successful in Phase II study, but said a partnership would likely be necessary to commercialize the drug if approved. New Enterprise Associates led the round, with Sanofi-Genzyme BioVentures also a first-time investor. NEA gets a seat on the board, while Sanofi-Genzyme, which can offer considerable expertise in rare disease drug development, will provide a board observer. Third Rock Ventures and VI Partners, which funded Edimer’s $22 million Series A in 2009, also are participating. -- Joseph Haas

aTyr Pharma: The San Diego biotech pulled in a $49 million Series D round as well as $10 million in venture debt to fund clinical trials of treatments for rare immune disorders. aTyr is developing protein therapeutics based on physiocrines, which are extracellular fragments of the tRNA synthetase family of enzymes. (You can find a deeper discussion of aTyr here in a recent START-UP feature on companies pursuing more phenotypic inquiry in the drug discovery process.) The firm's work on physiocrines -- which were first called "resectins" -- spun out of Scripps Research Institute and was backed by Alta Partners, Cardinal Partners, and Polaris Ventures, all of which participated in the new Series D. Domain Associates, which led aTyr's Series C, also participated, as did an unnamed global investment fund. The $10 million loan comes from Silicon Valley Bank and puts aTyr's total cash raised through equity and debt past the $100 million mark. tRNA synthetases have been well known for decades as humble helpers with protein synthesis within cells. No one gave them much thought as disease-modifying agents. Scripps reseachers realized the synthetases were also getting outside cells and being cleaved; part of the outcome of that cleavage were physiocrines, and that these fragments have extracellular signaling function that might also have disease implications. aTyr's focus on rare immune disease is fairly recent; in 2011, it quietly shelved its previous lead candidate, a thrombocytopenia treatment. -- Alex Lash

Dicerna Pharmaceuticals: This alumnus of the 2011 A-List said August 1 it has raised a $60 million Series C round, its first venture round in three years. The Boston-area biotech was part of the wave of companies to launch last decade, led by Alnylam Pharmaceuticals, to pursue therapies based on the breakthrough of RNA interference. Alnylam has had early clinical success, but generally the field's high expectations have been tempered because of drug-delivery limitations and other problems. Dicerna, however, has attracted a roster of new backers generally regarded as "crossovers," or public investors looking to buy into private companies to gain a foothold in a pre-IPO round. Dicerna's Series C was led by RA Capital and included Brookside Capital, Deerfield, and Omega Funds, which often buys shares from venture investors looking to cash out. The round also included all five of Dicerna’s existing institutional investors: Abingworth Management, Domain Associates, Oxford Bioscience Partners, Skyline Ventures and SR One. -- A.L.

BioMotiv: The drug-development accelerator based in Cleveland said August 5 it has raised $25 million from Nationwide Mutual Insurance and other investors, bringing its total cash raised to $46 million. That's about half of the firm's goal of $100 million to bring to fruition an asset-centric development model that looks to in-license preclinical compounds, work them into the clinic, and sell them to pipeline-hungry buyers with Phase Ib or IIa data. The only previously disclosed investors, which provided BioMotiv’s first $21 million, are University Hospitals of Cleveland and the Harrington family. BioMotiv is one piece of a $250 million initiative – The Harrington Project for Discovery and Development – spurred by the family to accelerate biomedical research into new therapies. Like many asset-based schemes, the BioMotiv structure allows returns from individual projects to pass through to investors. But as CEO Baiju Shah told our sister publication START-UP, which featured BioMotiv in its June Capital Matters column, the for-profit's investors are not limited partners; they function as direct investors with a certain amount of operational control, just as would the shareholders in a corporation. So when a return from a project comes in, investors will decide whether to distribute those earnings to themselves and management in an 80/20 split, or to plow them back into company operations. BioMotiv has already brought in eight compounds: two in oncology, three autoimmune-related, and one each in inflammation, ophthalmology, and infectious disease. The goal is 20 projects in hand at any one time. To maintain that steady state, the firm will have to reach another goal: an "evergreen" flow of capital to pour back into projects from successful exits. Shah hopes to have the first in the clinic in 2014.  -- A.L.

All The Rest: To support a clinical study of icaritin in advanced hepatocellular carcinoma, Shenogen raised $30M in Series C funds…Imperial Innovations led a £13.5M investment in the newly merged PolyTherics/Antitope…antibody company Apexigen completed a $20M Series A…vaccine player Vaxart raised $20M in a Series C financing...Karyopharm added $19M on to its Series B round, bringing the total to $67.2M…developing a Pfizer-discovered compound for premature ejaculation, Ixchelsis raised $14M from TVM Life Science Ventures VII…Merck Lumira Biosciences Fund led a $13.2mm investment in enGene…Rhythm Pharmaceuticals completed a second $11M tranche on its Series B, which now totals $44M…to advance monoclonal antibody linker technology, Meditope Biosciences closed a $3.6M Series A…Sialix, which is researching the role glycans play in cancer and inflammatory diseases, raised $1M in Series B funds from angel investors…AuraSense Therapeutics added on an undisclosed amount of money to its $5.4M Series B…days after completing reverse merger with Marathon Bar Corp., Lipocine privately raised $37.8M…to pay for clinical trials of cancer candidates Validive and Livatage, BioAlliance Pharma completed a €8.7M PIPE…Transition Therapeutics grossed $11M, enough funding to finish three major Phase II studies…cell therapeutics company TiGenix closed a €6.5M capital increase….Aeterna Zentaris raised $7.8M in a private placement to advance its zoptarelin doxorubicin (AEZS108) program in prostate cancer…CNS disorder-focused Vanda Pharmaceuticals closed on a $52.3M FOPO…Organovo, developer of 3D human biological disease models, publicly raised $40.5M…Opexa Therapeutics grossed $18M in a FOPO and plans to spend the money on Phase IIb studies of immunotherapeutic Tcelna...to pay for Phase I trials of BCX4161 for hereditary angioedema, BioCryst completed a $17.6M secondary offering…synthetic biology company Intrexon priced its IPO at $16, the top end of its range, to gross $160M...small-molecule cancer drug developer Onconova grossed $89M in its IPO…Conatus, focused on hepatic diseases, raised $66M in its IPO…stem cell manufacturer Cellular Dynamics completed its $45.6M IPO…Sophiris Bio set IPO terms at 5M shares…Acceleron Pharma, Five Prime Therapeutics, and Foundation Medicine filed for their initial public offerings…Emmaus Life Sciences, Paratek Pharmaceuticals, and Iroko Pharmaceuticals withdrew their IPO filings…through the offering of three series of senior unsecured notes, Celgene grossed $1.5B…and Telegraph Hill Partners closed on a $310M fund dedicated to life sciences and health care. -- Amanda Micklus

Many thanks to Paul Bonanos, who authored this fortnight's introduction on gene therapy. 

Photo courtesy of Flickr user certified su, who also has cool pictures of Australia. 

Deals Of The Week: A Feeding Frenzy Over ROR Gamma T Modulators?

A little-heralded deal between Amgen and Japan’s Teijin Pharma  July 31 marked the sixth since 2009 around compounds that modulate the ROR (retinoic acid-related orphan receptor) gamma t pathway, offering potentially a new small-molecule approach to addressing multiple autoimmune indications.

Drugs that hit RORγt might be able to modulate differentiation and regulation of Th17 cells, which play a role in inflammation related to many autoimmune disorders. It’s not just that the RORγt space has been fairly busy – a look at the names of the companies working in this arena indicates significant investment and potential. Bristol-Myers Squibb, Merck & Co., Pfizer and Johnson & Johnson all have made deals with smaller companies around RORγt assets in recent years.

A seventh deal could be looming as well, as Vitae Pharmaceuticals currently is considering partnering its lead-op stage RORγt inhibitor program. CEO Jeffrey Hatfield recently told “The Pink Sheet” that Vitae’s early data are being reviewed by roughly one-dozen potential partners and the company is looking to announce a deal, if it decides to make one, in September or October.

“Those [prior RORγt deals] seem to us to have been done in very early stages of discovery,” he said. “They were not particularly big deals, and there wasn’t a lot of buzz around the work done by the biotechs before the deals were announced. The sense I get from other companies is that the state of the art is not very advanced.”

Hatfield said the interest he has seen in his program, including one term sheet that came in before Vitae reached preclinical proof-of-concept, suggests RORγt is becoming one of those “hot spaces” that almost every player wants a part of.

“Everybody wants a program,” the exec asserted. “There just aren’t enough programs to possibly go around to meet demand.” Beyond MS and RA, Hatfield suspects RORγt modulation might have potential in psoriasis, ankylosing spondylitis and irritable bowel disease. Ultimately, he thinks targeting RORγt might enable modulation of a broader range of pro-inflammatory cytokines than currently is possible with anti-TNF drugs such as fusion protein Enbrel (etanercept), monoclonal antibody Humira (adalimumab) or MS treatment Tysabri (natalizumab).

Amgen and Teijin announced their collaboration on July 31, a discovery, development and commercialization agreement that would give Amgen worldwide rights except for Japan to compounds discovered in the joint R&D collaboration. Teijin, which gets an undisclosed upfront payment along with potential milestones and royalties, would retain marketing rights in its home market and also hold the right to co-promote any resulting products in select Asian markets.

Deal-making around this target kicked off in Japan when Japan Tobacco and San Diego’s Orphagen Pharmaceuticals announced a partnership in January 2009 aimed at inhibition of Th-17 cells to treat psoriasis. Then, in October 2010, Bristol in-licensed preclinical TGR5 agonist XL475 and discovery-stage RORγt inhibitors from Exelixis. The South San Francisco, Calif., biotech received $35 million upfront for XL475 and another $5 million upfront for the RORγt program.

Two more deals followed in 2011: First, Merck signed a collaboration with Lycera in March to co-discover autoimmune disease candidates based on the Michigan biotech’s RORγt research. Lycera, which received $12 million upfront, triggered the first milestone under the agreement in December of 2011 – total deal-related milestones could reach $295 million. As a possible indication of Merck’s assessment of Lycera’s technology, the two companies signed a second autoimmune R&D deal in February of 2013.

In December 2011, Pfizer signed an R&D pact with Karo Bio to discover and develop RORγt modulating compounds. This deal brought the Swedish biotech an undisclosed upfront payment – the companies revealed publicly that Karo Bio could earn up to $217 million in combined upfront cash and milestones, along with potential royalties, while Pfizer would fund all of the R&D work.

Prior to the Amgen/Teijin transaction, the most recent RORγt deal involved J&J’s Janssen Biotech licensing exclusive rights to a set of molecules discovered by Phenex Pharmaceuticals. The German company can earn up to $135 million in upfront cash and development and regulatory milestones under the December 2012 pact, along with sales milestones and royalties.

It was an extremely active week for deal-making outside the RORγt space as well, as July melted into August. Most noteworthy were Perrigo’s acquisition of Elan Corp. along with Cubist Pharmaceuticals’ two buyouts, of Optimer Pharmaceuticals and Trius Therapeutics. For the other highlights, read on as we unveil ...

Perrigo/Elan: By buying Dublin-based Elan, Perrigo of Allegan, MI, will re-domicile itself in Ireland where the corporate income-tax rate is a low 12.5%, offering fertile soil for international growth. The purchase also will give Perrigo access to royalties for the multiple sclerosis drug Tysabri (etanercept), which Elan discovered and then sold to Biogen Idec on Feb. 6. 2013. Elan began looking a buyer this year after Royalty Pharma tried to acquire it. The deal, announced July 29, ends a bitter takeover saga in which Elan rejected three hostile bids by Royalty Pharma and management clashed with shareholders about strategy. Perrigo, which manufactures over-the-counter pharmaceutical products for the store-brand market and has a market value of about $12 billion, will pay $6.25 per share in cash plus $10.25 per share in stock, a premium of about 10.5 percent over Elan's closing price on July 26. “We believe this transaction is compelling for Elan shareholders and fully takes into account the value of Elan’s assets, including a large cash balance and a double-digit royalty claim on Tysabri, a blockbuster product that generated revenues of $1.6 billion last year and has been growing at a compound annual growth rate of 19%,” Perrigo CEO Joe Papa said. - Sten Stovall




Cubist/Optimer/Trius: Antibiotics marketer Cubist Pharmaceuticals made a pair of moves July 30 that complement its hospital-based antibiotic franchise, acquiring current partner Optimer Pharmaceuticals and clinical-stage anti-infectives developer Trius Therapeutics.The simultaneous, all-cash deals will cost Cubist at least $1.24 billion by the end of 2013, when they’re expected to close. Cubist will pay $10.75 per share, or $535 million, upfront for Optimer, and $13.50 per share, or $707 million, upfront for Trius. The upfront payments represent a 15% premium over San Diego-based Trius’ July 30 closing price, but a 19% discount to Optimer’s July 30 closing price. Yet the upfront prices may not be the acquisitions’ final values. Both deals include contingent value rights which could deliver substantial additional returns to the acquired companies’ shareholders, and are based on the net sales performances of their key drugs. Peak sales for both therapies in territories that belong to Cubist could run between $600 million and $1 billion, Cubist management estimated. They expect the deal to be accretive starting in 2015. Optimer currently sells Dificid (fidaxomicin) in the U.S. and Canada to treat diarrhea associated with Clostridium difficile infections. If the drug generates $250 million in net sales by the end of 2015, Optimer’s shareholders would receive an additional $3 per share. If sales reach $275 million or $300 million, they would receive $4 or $5 per share, respectively. That could drive the deal’s overall value as high as $801 million. Trius has the Phase III drug tedizolid, also known as TR-701, for Gram-positive and other bacterial infections. Its shareholders would receive an additional $1 per share if tedizolid produces $125 million in net sales during 2016, and up to another $1 if it sells between $125 million and $150 million that year, delivered on a pro rata basis. The buyout could be worth $818 million in total if the CVR is realized fully. - Paul Bonanos

AstraZeneca/Fibrogen: Privately held FibroGen already had a territorial partner in Astellas Pharma for its late-stage anemia drug FG-4592. Now, the San Francisco-based company has teamed with AstraZeneca to share rights to the drug in other major markets. The new deal covers the U.S., China and other unspecified territories, not including those in which Astellas already holds rights: Europe, the Commonwealth of Independent States, the Middle East and South Africa. AstraZeneca and FibroGen say they’ll collaborate to promote the drug. AstraZeneca will commercialize the drug in the U.S., although FibroGen will promote it in end-stage renal disease patients. In China, FibroGen will handle the regulatory process, manufacturing and medical affairs, while AstraZeneca will take the lead on promotion and distribution. The British pharma paid $350 million upfront, including non-contingent short-term payments, for rights to the candidate. Developmental milestones could add $465 million to the deal, while unspecified sales milestones could further add value. If the drug is approved, AstraZeneca will also owe FibroGen royalties in the “low 20% range,” according to a joint statement. FG-4592 induces red blood cell production, or erythropoiesis, by inhibiting a protein called hypoxia-inducible factor, thereby mimicking the body’s natural response to high altitude. Well-funded start-up Akebia Therapeutics has a Phase III-ready HIF inhibitor, while GlaxoSmithKline has a Phase II candidate. FibroGen also has FG-3019, a Phase II connective tissue growth factor inhibitor that has shown promise in idiopathic pulmonary fibrosis, liver fibrosis due to hepatitis B and pancreatic cancer. - P.B.

Actelion/Ceptaris: Actelion Pharmaceuticals' options deal to acquire Ceptaris Therapeutics is a small, but important and relatively risk-free step in the biotech’s efforts to diversify away from its heavy reliance on its highly successful treatment for pulmonary arterial hypertension, Tracleer (bosentan). On July 31, Europe’s largest biotech announced that it is paying $25 million upfront for an option to buy Ceptaris, contingent upon the latter’s receiving FDA approval for its only asset, Valchlor (mchlorethamine gel). Valchlor’s PDUFA date is Aug. 27. If Valchlor gets a regulatory green light, Actelion will pay Ceptaris investors an additional $225 million, plus undisclosed commercial and sales-based milestones. Actelion’s internal R&D track record is mixed, leaving its near-term diversification strategy highly dependent on efforts to launch a next-generation PAH treatment, macitentan. Macitentan’s NDA is pending before FDA, with a PDUFA date of Oct. 19, and it also awaits EU authorization. In the meantime, the Swiss firm sees Ceptaris as a way to obtain an asset that is “meaningfully differentiated,” rapidly accretive and focused enough so that it will not distract from the effort around macitentan, said Actelion SVP Roland Haefeli. Valchlor, if successful, will be the only FDA-approved topical formulation of mechlorethamine for treatment of early-stage mycosis fungoides-type cutaneous T-cell lymphoma, a rare form of non-Hodgkin’s lymphoma. - Wendy Diller

Kolltan/MedImmune: Cancer-focused Kolltan Pharmaceuticals in-licensed a monoclonal antibody targeting the HER3 receptor tyrosine kinase from MedImmune, the global biologics arm of AstraZeneca, on July 29. Financial terms were not disclosed but privately held Kolltan said in a release that both companies have the potential for future cost-, risk- and profit-sharing arrangements related to the antibody after the New Haven, CT-based biotech completes early clinical testing. Based on the candidate’s current status, Kolltan expects to initiate a Phase I study of the antibody during the first quarter of 2014. - Joseph Haas

Celgene/Array: In its second licensing arrangement of the month, Array BioPharma signed a strategic collaboration with Celgene July 29 focused on a preclinical development program targeting an undisclosed novel inflammation pathway. Boulder, CO-based Array gets $11 million upfront, while Celgene obtains an exclusive option for multiple potential clinical development candidates under the deal. In addition to the upfront, Array can earn total development, regulatory and sales milestones of up to $376 million as well as royalties. It will retain all rights to programs that Celgene does not select. Previously, on July 10, Array licensed an undisclosed preclinical oncology compound and related intellectual property to Aisling Capital-backed start-up Loxo Oncology. Array got an ownership stake in the new company under that deal, as well as potential for up to $434 million in milestones and royalties. - J.A.H.

Bristol/Samsung: Bristol and South Korea-headquartered Samsung BioLogics inked a 10-year agreement July 29 under which Samsung will manufacture a commercial antibody cancer drug at its new plant in Songdo Incheon, South Korea. Financial terms were not disclosed. In a release, Bristol said technology transfer and trial production began in July, while commercial production will start once regulatory approval is obtained. In a statement, Louis Schmuckler, Bristol president, global manufacturing and supply, said the arrangement is part of the pharma’s focus on establishing long-term relationships with quality manufacturing partners worldwide. “This agreement increases our biologic manufacturing capacity to help ensure sufficient long-term supply of our commercial products,” he said. - J.A.H.


Photo credit: Wikimedia Commons

How Vitae Tries To Provide An Optimal Environment For Innovation

One of the best things about having time to sit down with a company's executive team and discuss matters such as pipeline and business strategy at leisure is the chance to intersperse more philosophical questions that address how a company views itself and the work environment it tries to provide.

In meeting a few weeks ago with the executive team at Vitae Pharmaceuticals near Philadelphia for a profile in "The Pink Sheet," I got more information than I could process on the firm's structure-based drug design process, the genesis of its proprietary Contour technology platform and its plans for pipeline assets in indications such as chronic kidney disease and acute coronary syndrome.

Vitae Pharmaceuticals CEO Jeff Hatfield

But as I spoke with CEO Jeff Hatfield, CFO Tina Fiumenero and Chief Scientific Officer Richard Gregg, all of whom came to the clinical-stage company from Bristol-Myers Squibb, I wanted to ask about the best environment for innovation in drug discovery and what precisely the term "biotech" even means in 2013, if such a definition can be nailed down.

As Hatfield explained that he brought in Gregg after initial CSO and company co-founder John Baldwin retired, he noted both the depth of Gregg's Rolodex and the fact that he had led discovery in all areas at Bristol. Therapeutic agnosticism is important for a company that wants to go where its technology takes it. Hearing Gregg talk about Vitae's quicker, streamlined decision-making and its speed in drug discovery against challenging targets, I posed the question: "Coming from big pharma, would you say it's necessary to leave big pharma if you want to innovate in drug discovery?"

Vitae CSO Richard Gregg

Gregg's response to the somewhat loaded question is a bit on the cautious side, but still interesting.

"I think that one does not have to leave big pharma but it is easier [to innovate] in a biotech environment. It’s not that big pharma can’t [do it] but with a lot of the bureaucracy and decision-making processes, they make it difficult to be truly innovative there. I’m not going to say it’s impossible, but it’s easier in biotech," he said.

Hatfield then elaborated on the innovation topic: "I think there’s an awful lot to the culture and environment that people work in ... I don’t think the scientific talent is different in either direction - I don’t think it’s better in big pharma, I don’t think it’s worse in big pharma. What is really different is the culture that exists between a large organization, whether it’s in pharmaceuticals or manufacturing Twinkies, it doesn’t matter, big organizations have an organizational behavior, a culture, that by necessity is more structured, more controlled, and in a small organization, that’s much less the issue."

Culture is a big part of what defines biotech, in 2013 as in 1999, the CEO added. But does Vitae, with its focus on small-molecule drugs for primary-care indications, really fit the definition of biotech?

"Everybody has a slightly different definition of biotech," Hatfield said. "Yes, we do view ourselves as biotech, because we are innovative and I think that's a better essence of what biotech is supposed to represent, not whether it is small molecule or large molecule. It's pursuit of innovation to make a difference in the world."

But, besides its technology, what makes a company like Vitae innovative? Hatfield thinks getting buy-in from the ground-floor level R&D team is a good place to start. In other words, innovation comes from motivation, which may stem partly from comfort level.

"When we were getting this company going [it was founded in 2002, and Hatfield signed on as chief in 2004], I asked a group of bench scientists to define the culture. I said ‘tell me the environment you want to work in.’ And so they did, and it was not management-driven in the slightest bit. They came up with five principles of what they wanted the focus to be," he explained.

Those five tenets selected by the bench scientists themselves in 2006 as the company's modus operandi? Not surprisingly, the first was innovation - to create rather than copy. Next, they wanted to be evaluated on the basis of success, not the amount of activity, on helping to produce the right compound, rather than just a lot of compounds.

As Gregg alluded to, a third important value for the R&D team was quick decision-making, which the group called "sense of urgency." The scientists made clear they didn't want to hear about committees being organized to ponder the latest idea. They also wanted a teamwork-driven environment in which the chemists and biologists communicate directly and trouble-shoot together.

Finally, easier said than done, they wanted a fun place to work. Which is about as easily defined as what biotech means in 2013. But on the other four measures, the results to date suggest that Vitae may be living up to its own chosen values. Whether that proves to be a lucrative formula remains to be determined.

Deals Of the Week, Once Again, Ponders Biosimilars

Teva Pharmaceutical Industries Ltd.’s and Lonza Group’s announcement on July 25 that they were formally ending their four-year-old biosimilars joint venture was hardly a surprise, given that late last year both companies said they were reviewing their relationship. Their decision certainly reflects the complexities of developing biosimilars, but it also is the consequence of each company’s new leadership, which has different priorities than those who forged the original deal.

Signed at a time when biosimilars seemed like an incredibly promising, albeit vague, long-term opportunity for an assortment of generics and pharma companies, the original deal was ambitious in scope. Each company committed to spend $300 million over six years on the alliance, estimating the cost of developing one biosimilar would be roughly $100 million – considered a lot at the time. Teva saw biosimilars “as a major growth driver” and positioned itself as “a leader in this market,” then President and CEO Shlomo Yanai said at the time. Lonza would bring large-scale biologics manufacturing and development expertise to the table, while Teva offered experience in clinical development and marketing of generic and branded drugs.

Four years later, even as the EU and U.S. regulatory pathways for biosimilars gain some clarity, the overall landscape for the field is as complex as ever. Like their competitors, Teva and Lonza held much of their work close to their vests, but they had counted on developing a franchise around a biosimilar version of Roche’s $7 billion Rituxan (rituximab) franchise, only to halt clinical development last October due to “changes in the regulatory and competitive environment.” They weren’t the only ones to face setbacks on rituximab programs: Celltrion Inc. and its partner Hospira Inc., and the Samsung Biologics/Quintiles Transnational Holdings Inc. alliances also are also in the midst of re-evaluating their biosimilar rituximab programs.

More telling, perhaps, new CEOs at each company are set on revamping priorities across the board. Lonza’s new CEO, Richard Ridinger, who joined the company in April 2012, is in the midst of re-organizing the company into two core areas, pharma and biotech and specialty ingredients. On an earnings call also on July 25, he said the company, which accounts for about a third of all mammalian cell culture manufacturing worldwide, would reduce its manufacturing footprint, including closing two plants. Lonza indicated that it holds CHF100 million ($107.6 million) in assets on its balance sheet in relationship to the joint venture and has expensed CHF38 million since its formation. The company estimates it will save CHF150 million by ending the deal.

Teva releases its second-quarter numbers on August 1, so the company isn’t providing accounting details or elaborating on the announcement. But CEO Jeremy Levin, who assumed his position in May 2012, is emphasizing greater selectivity and focus across the board, rationalizing overlapping projects, and improving the efficiency of an organization that had become unwieldy and unfocused, even as it has grown rapidly in the past decade. A lot of that rationalization is taking place in Europe, where markets are relentlessly unforgiving and where Teva’s –and its competitors’ – first attempts at biosimilars launches are occurring.

Biosimilars work continues at Teva internally. In comments earlier this year, both Levin and Chief Scientific Officer Michael Hayden said they would pursue biosimilars as part of a broader biologics program. Teva currently has several generic versions of marketed biologics on the market, although it went through traditional regulatory routes to get approvals: TevaGrastim, a generic version of Amgen Inc.’s Neulasta (pegfilgrastim) has been available in Europe for several years, for example. “I would say that in the biosimilars space, we still remain enthusiastic, but we’re going to be smart about it,” said Hayden in an investor call late last year, noting. “We're going to be in biosimilars in a very focused way.”

And since Teva is mum on the subject, it’s worth noting an observation by Frederick Wilkinson, president of Teva competitor Actavis Inc.’s specialty brands unit, on the latter’s own earnings call the same day as the Lonza-Teva announcement. Actavis has a joint venture in biosimilars with Amgen and Wilkinson said it expects a news update from that endeavor in August.  “I wouldn't actually read too much into it,” Wilkinson said of the ‘no deal.’ “If you looked at the Teva biosimilar program, they at some point had bought enough different companies that they had multiple projects going on the same product. And so, I think what they've done is probably very efficiently pruned their product line down to the leading entities within their biosimilar portfolio. Lonza for the last year has been out selling or trying to solicit use of space, so it has been obvious that the Lonza Teva relationship was not going to be as deep as it originally was [planned to be].” 

If you're looking for deals that may be smaller scale, but have a fresh start, here are some of the newest developments in what was generally a quiet deal-making week:--Wendy Diller

Adimab/Biogen &Adimab/GSK: Adimab’s tech transfer deals with GlaxoSmithKline  and Biogen Idec represent the small biotech’s greatest business development and financial successes to date.

The deals, each announced July 26, see Adimab setting up its technology platform inside its partners’ R&D shops. By licensing non-exclusive rights and transferring this antibody discovery and protein engineering platform to GSK and Biogen, Adimab enables its partners to expand their use of a technology that the biotech has until now tightly controlled. Both Biogen and GSK had previously allied with Adimab (GSK through the acquisition of Adimab partner Human Genome Sciences Inc.), but like the biotech’s 19 other partners, they were limited to one- or two-target “trials.”

GSK’s agreement is for an indefinite number of years, with unlimited product licenses across all therapeutic areas. Biogen’s deal is more limited – a seven year (renewable) term, limited to certain disease areas where Biogen has a presence, and a limited number of commercial licenses. Both companies can use the technology to pursue any antibody format – including antibody-drug conjugates or bispecific antibodies – and have retained options to access any future improvements or additions to the Adimab platform.
The financial specifics of the two new Adimab deals were not disclosed. In each, Adimab will receive a “significant” upfront cash payment, annual license fees for the lengths of the deal, R&D milestone payments, and royalties and commercial milestones on a defined number of therapeutic products.

The upfront funding from the two deals make Adimab a decidedly profitable discovery engine for the foreseeable future, and the company will make its first dividend payment to its venture investors later this year. It expects to sign one more platform transfer deal this year, and three per year through 2015.--Chris Morrison.

Kolltan/Children’s Hospital Of Philadelphia: Cancer-focused biotech Kolltan Pharmaceuticals announced a license of intellectual property and research agreement with Children’s Hospital of Philadelphia July 18 around discovery efforts for neuroblastoma therapeutics targeting anaplastic lymphoma kinase (ALK). Terms of the deal were not disclosed. Based in New Haven, Conn., Kolltan’s focus is on large-molecule approaches to receptor tyrosine kinase (RTK) inhibition – it has six programs ongoing at the discovery and preclinical stage and plans to file an IND for its first clinical candidate before year’s end. The firm will collaborate with researcher Yael Mosse, who studies the causes and potential therapeutic approaches for treatment of children diagnosed with neuroblastoma. In a statement, Mosse said ALK-targeted immunotherapy or antibody-drug conjugates may offer the best approach for patients whose tumors have an ALK mutation or amplification. “We believe immunotherapy and ADCs may provide a therapeutic option for the majority of patients with high-risk disease given the widespread expression of ALK on the cell surface of most neuroblastoma tumors,” she said.--Joseph Haas

Lilly/Transition: Transition Therapeutics  has obtained a worldwide exclusive license for Eli Lilly’s small molecule transcriptional regulator TT-601 for the treatment of osteoarthritis pain, the biotech announced on July 23. The compound has completed preclinical development, and Transition plans to take it into the clinic during the first half of 2014. TT-601 modulates the activity of a novel nuclear receptor target. Tony Cruz, CEO of Transition, says that molecules in this class “have shown target engagement in the joint space and efficacy in multiple animal models of joint pain.” Twenty-seven million Americans have OA. Under the agreement, Transition gets the rights to develop and possibly commercialize TT-601. Lilly keeps an option to reacquire the agent on review of proof-of-concept data, in which case Transition would be eligible for milestone payments of approximately $130 million and a high single-digit royalty on the sale of potential products containing TT-601.

Should Lilly not take the option, and the product comes to market, Lilly would be eligible for a low single-digit royalty from Transition. There’s a good chance Lilly will pull the trigger on the option. This deal comes on the heels of Lilly’s June 17 decision to exercise its option to reacquire another compound licensed to Transition, TT-401 for diabetes. Transition took a $7 million option fee, and could get up to $240 million in milestones from that deal. That goes back to a March 2010 deal between the partners in which TT-401 was included among a few other preclinical candidates from Lilly. Their partnering history began in 2008 with a non-option deal in which Lilly licensed TT-223 and other gastrin-based therapeutics for both Type I and II diabetes from Transition.--Michael Goodman

PolyTherics And Antitope Merge: Britain’s privately owned PolyTherics  and Antitope have merged their biopharma services businesses to tap growing demand from Big Pharma for services and technologies used in the search for biologics such as antibody-drug conjugates.

The enlarged group has a strong client base in the biotechnology and pharmaceutical industry, including the top ten biggest drug makers. It will offer conjugation technologies to generate more stable and homogeneous antibody drug conjugates, technologies to optimize the pharmacokinetics of biologics, technologies for immunogenicity screening, technologies to re-engineer antibodies, and proteins to reduce their immunogenicity, and cell line development technologies.

Antitope, founded in 2004, tests immune responses caused by antibody therapies and engineers modifications for the drugs. That expertise should complement the conjugation and polymer technologies from PolyTherics, which was created in 2002 as a University College London spin-off.

PolyTherics financed the merger with £13.5 million ($20.1 million) raised from a group of backers that includes Imperial Innovations, Invesco Perpetual, Mercia Fund Management, Advantage Enterprise & Innovation Fund, ProVen Health, Oxford Technology VCTs and high net worth individual's funds managed by Longbow Capital.--Sten Stovall