Archives for the month of: July, 2013

Today, the government announced the winners of the third round of Biomedical Catalyst (BMC) funding. A total of £25.9 million has been invested in 29 companies and five universities to take forward a range of innovative projects. You can see the BIA’s response to this positive news here.

The BMC continues to make a hugely positive impact on the sector – accelerating medical research and leveraging significant sums of private capital – and it is fantastic that the fourth round is already open for applications. The commitment of further funds to support the scheme announced by government in the June Spending Review followed a successful BIA led campaign with the sector.

To capture some of this new data the BIA has updated its BMC infographic which displays some of the key metrics to be aware of. To help explain some of the data contained in it we have separated out some of the pictures.

Significant private capital leveraged

BMC_infographic_beaker_leverageThese two flasks show the amount invested thus far and information on the private capital that has been leveraged alongside. You can see the split between the funding for business-led projects (in blue) and academic-led projects (in red). The most recent round supported business-led awards with £16 million of grant funding bringing the total to just over £80 million in all three rounds. A number of these are collaborative projects involving two or more parties.

The next flask in purple shows the private capital that has been leveraged to support the specific projects. This shows that almost £70 million of private funding has been leveraged by the scheme to date. This relates to business-led projects only and of course there has been more money raised by commercial collaborators in academic-led projects which would raise the figure further still.

Additionally, this figure relates to the private capital specific to the projects (calculated by subtracting the grant from the total project costs) and it perhaps undervalues the true amount of private capital leveraged in total. Numerous companies have closed successful financing rounds off the back of a BMC award not just related to the project but where clearly the BMC has provided a stamp of approval to the technology.

In total, the BMC thus far is supporting business-led projects worth almost £150 million.

A range of therapeutic areas supported

BMC_infographic_therap_areaThe business-led awards supported so far are in a wide range of therapeutic areas demonstrating the depth and quality of innovative R&D currently ongoing in the UK. Looking at the image one can clearly see that oncology and infection have the highest number of projects backed. But looking at the stage of development of the projects – the award types – is also interesting. Two thirds of those projects categorised as ‘skin’ or ‘oral and gastrointestinal’ for example are in later stage clinical development.

The third round has seen projects for new therapies for genetic disorders, advanced cell and regenerative medicine therapies, vaccines and anti-bacterial drug development to medical devices and aids for early diagnosis of Parkinson’s Disease, dementia and new imaging technologies.

Projects underway across the UK

BMC_infographic_map1The BMC is supporting projects all across the UK as this map shows. The ‘golden triangle’ of Cambridge, Oxford and London have over 60 business-led projects moving forward. But there are also significant funds and associated private capital flowing in to other parts of the UK from the south west to Scotland with late stage projects moving ahead in Wales and the north of England.

25% of business-led projects have included at least one collaborator and if we included these in the map also the geographic spread would likely be enhanced further.

R&D along the pathway

BMC_infographic_amount_test_tubesYou can see from the information in these images that the BMC is supporting projects along the research and development pipeline just as it was intended to do. While the largest number of projects supported numerically are in the feasibility category (where funding of about £150,000 is obtainable) you can see that the largest amount invested into business-led projects is in the early stage category (almost £50m). A good proportion of the funds have also been invested into late stage projects with a number of clinical proof of concept trials getting underway.

Finally, one of the key aims of the Biomedical Catalyst when it was launched was the support of medical research throughout the development pathway, or a ‘funding ladder’ from feasibility through to late stage. A number of feasibility projects supported in the first two rounds are now coming to fruition in the next few months and many of them are already showing success. A number of these may progress further and it demonstrates the speed with which the MRC and TSB have worked together to ensure the BMC has impact.

Danny Alexander visits ReNeuron

Danny Alexander visits ReNeuron

Last week, the Chief Secretary to the Treasury, Cabinet Minister Rt Hon Danny Alexander MP, visited BIA member company ReNeuron. As a senior member of the UK government it was great to see his interest in ensuring the fiscal environment for bioscience remains positive, and that he was interested in learning more about the regulatory and reimbursement challenges in developing innovative medicines and therapeutics for areas of unmet medical need.

I was pleased to see that the Mayor of London announced funding to establish Med City in London. The Mayor and his team see Med City as part of a global hub for medical innovation and discovery that will draw in investment, established pharmaceutical companies and start-ups. I am looking forward to working with the Mayor, Deputy Mayor Kit Malthouse and his team to ensure that this initiative works to deliver healthcare benefits to patients and to boost the UK economy.

Following on from our recent CEO and Investor Forum we have added posts highlighting some of the key sessions to our blog: a summary of my conversation with Patrick Verheyen, head of Johnson & Johnson’s (J&J) innovation centre in London; an overview of discussions on sector financing; and David Hipkiss, CEO of Prosonix’s tips for things he wished he had known when he started out as a CEO.

Looking forward to the second half of this year, the BIA will be delivering over 30 events and mission for the sector. BIA will be working in partnership with Biopartner and UKTI to lead lifescience trade missions to Brazil, Australia, China, Europe and the USA. Often there is financial assistance available to eligible participants. Find out more on our website.

The Biomedical Catalyst round four competition opens today and we stand by to triumph the round three winners expected to be announced later this week.

On a personal note can I thank members for their kind wishes on the birth of my son Teddy last week, both he and my wife Jess are doing well – although we are a little short of sleep this summer in the Bates household.

Best
Steve

Danny Alexander with Michael Hunt and John Sinden

Danny Alexander with ReNeuron CEO Michael Hunt and CSO and Founder Dr John Sinden

Earlier this week (23 July) the Chief Secretary to the Treasury, the Rt Hon Danny Alexander MP, visited BIA member company ReNeuron, a leading, clinical-stage stem cell business. It was very positive to see a senior member of the UK government keen to engage with the sector and understand the challenges to developing innovative medicines and therapeutics for areas of unmet medical need.

Danny Alexander’s visit came at an opportune time, coming as it did just a day after ReNeuron’s positive news of a significant £33 million financing package and plans to build a new manufacturing facility in Wales. The latest fundraising is a significant boost to the regenerative medicine sector and a solid commitment to the UK.

Meeting with Chief Executive Michael Hunt, Chief Scientific Office Dr John Sinden and Antonis Papasolomontos from the BIA, the discussion covered a wide range of issues with the Minister keen to explore the state of the sector and the challenges of developing advanced therapies.

Discussing government support for the sector, Michael and John were able to outline the positive difference schemes such as the Biomedical Catalyst, other TSB funding calls and the Cell Therapy Catapult makes for a small company translating medical research towards the point of clinical proof-of-concept. As an AIM quoted SME, ReNeuron may also benefit from recent positive changes made by HM Treasury including the removal of Stamp Duty on trading in AIM shares and allowing funds held in stocks and shares ISAs to be directly invested in AIM companies.

With government changes to the fiscal environment seen as largely positive discussions moved on to the recent House of Lords Select Committee report into regenerative medicine and in particular its recommendations around the use of regulatory flexibilities, such as an Earlier Access to medicines Scheme, and the important issue of getting the assessment, evaluation and reimbursement framework clearly established and able to fairly deal with new innovative regenerative medicine products as they come to market.

Danny Alexander at ReNeuron

Danny Alexander on a lab tour at ReNeuron

There was also time for a lab tour of the facilities where the Minister had a chance to see the science first hand and understand a little more about ReNeuron’s innovative technology and lead programmes in stroke, critical limb ischaemia and blindness-causing diseases of the retina.

The BIA’s UK CEO and Investor Forum, held at Down Hall in Hertfordshire on 10-11 July, was bigger than ever with more than 90 senior sector attendees. In the third of three posts, the BIA reflects on some key themes from the event.

David Hpkiss at the BIA UK CEO and Investor Forum

David Hipkiss, CEO of Prosonix

The final keynote speaker of the Forum was David Hipkiss, CEO of Prosonix. David discussed a number of things he wished he had known when he started out as a CEO.

David noted that:

  • There should be strong alignment between management and investors. if you are in a situation where you think that what’s best for the company is not best for investors, then either you are in the wrong company or have the wrong investors
  • The investors make the rules. But, all money is not equal – if you can, don’t necessarily take the first offer you get. CEOs need to understand what finance means, so it is important to get training if you need to.
  • It is all about the money. If you are getting distracted by negotiations, you should take the money and move on.
  • Companies should focus on what they are good at and not try to be all things to all people. You should develop a clear message about your product and then make sure everyone in your team lives, sleeps and breathes it.
  • The relationship between the CEO and Chair is key. If you have an Executive chair, you’re not the CEO you’re the general manager.
  • Don’t bother with trophy NEDs – get NEDs who are useful and helpful and don’t accept a NED unless they add something.
  • The role of the independent director is key as they can act as a mediator between Chairman, CEO and NEDs.
  • Know when to change the team and don’t ignore the impact of individuals creating a negative impact. Don’t ‘over-title’ people at the beginning, as you may have to bring in more senior people at a later stage.
  • Believe in what you are doing. If you don’t believe it, you shouldn’t be doing it.

In closing David said that everyone involved in the sector should remember that our ultimate customers are the patients.

The BIA’s UK CEO and Investor Forum, held at Down Hall in Hertfordshire on 10-11 July, was bigger than ever with more than 90 senior sector attendees. In the second of three posts, the BIA reflects on some key themes from the event.

From an analysis of the funding environment, case studies of recent fundraisings and the public markets, financing of bioscience companies in the UK was top of the agenda at the BIA’s UK CEO and Investor Forum.

Rowan Gardner of Biolauncher at the BIA UK CEO and Investor Forum

Rowan Gardner of Biolauncher

The main conference opened with Biolauncher’s Rowan Gardner providing an analysis of life science funding in the UK. Rowan highlighted some recent trends – noting that the UK is (a distant) second only to the US in terms of capital investment. Rowan also suggested some solutions for building a strong sustainable future. These included starting more companies, developing entrepreneurs and talent, and diversification of the funding base.

Fundraising panel at BIA UK CEO and Investor Forum

Fundraising panel

The BIA’s chairman-designate Ed Hodgkin led a session looking at some recent fundraisings in the sector. The discussions included how to create sustainable companies, accessing the public markets and who the current sector investors are. As the number of bioscience IPOs in the US increases delegates were interested to understand when access to the public markets in the UK might re-open. There was a feeling that there needed to be more investors with an interest in the sector – UK fund managers are not attending medical conferences like their US equivalents and banks will not invest in life sciences analysts unless they have listed companies to analyse. There were questions around how to get generalist investors interested in the sector and whether government should act to stimulate the market or if it should be left to market forces. It was noted that if there is a cohort of companies that come to the market they will need to offer good propositions to reassure investors.

Funding initiatives panel at BIA UK CEO and Investor Forum

Funding initiatives panel

Allan Marchington, Apposite Capital and BIA Board member, led a discussion around some of the new funding initiatives in the sector. Chris Hollowood, of Syncona Partners, said there is less capital available now and that funds are operating on a variety of different models. He said that companies are increasingly realising that they need to take the money from the ‘right place’. The BIA’s Steve Bates said that one of the reasons the US biotech sector took off was the change in investing rules for US pension funds instigated by Ronald Reagan and he wondered how the risk appetite of UK pension funds could be changed.

Funding journey panel at BIA UK CEO and Investor Forum

Funding journey panel

Steve Bates, BIA’s Chief Executive Officer, led a session which considered the finance journey for a company from formation to the market. Simon Kerry of Karus Therapeutics and the Angels for Life Sciences group, said biotech companies raising money from angels find it difficult to compete with other sectors. He noted that the Biomedical Catalyst recipients are interesting to angel investors as they demonstrate that they have already attracted funds and had their projects examined by experts. Elevate Capital’s Paul Toon said crowd-funding is very interesting at the moment and that while it is easy to see the passion people have there is a need to have a platform to harness this. He suggested that the BIA’s Citizens’ Innovation Funds proposal could deliver this. Helen Kuhlman of the Technology Strategy Board outlined some of the agency’s programmes, including the Biomedical Catalyst, which aim to incentivise others and help companies bridge funding gaps. GW Pharma’s Justin Gover, suggested companies consider the US market for a listing as US investors are interested in foreign companies and will also look at binary investments and big risks.

Despite the challenges noted by Rowan and the closed public markets, there was a general feeling that the funding environment for biotech companies – at all stages – has improved in the past couple of years and that it is likely to develop further in future.

The BIA’s UK CEO and Investor Forum, held at Down Hall in Hertfordshire on 10-11 July, was bigger than ever with more than 90 senior sector attendees. In the first of three posts, the BIA reflects on some key themes from the event.

Patrick Verheyen in conversation with Steve Bates

Patrick Verheyen in conversation with Steve Bates

The conference started with Partrick Verheyen, head of Johnson & Johnson’s (J&J) innovation centre in London, as the guest for the “fireside chat” with BIA CEO Steve Bates.

As part of its strategy to identify early stage innovation, whether at academic institutions or in life science companies, J&J is establishing four innovation centres, in London, Boston, California and Shanghai.

Patrick discussed the company’s strategy and goals for the centre in London. He said J&J recognises that innovation happens globally and that one of the key hotspots with high quality academic research, clinical institutions, companies, entrepreneurs and government support is the South of England. He said the company will use London as a hub, not only for the UK, but also to reach into Europe. Another reason Patrick said he likes London is that it is conveniently located for getting back to Boston.

The innovation centres are fully aligned with J&J’s internal focus and Patrick said the aim is to surround themselves with the best people in the world. The centres have a team of science and technology experts from J&J’s areas of interest.

Patrick said he wants the centre to facilitate an exchange of people, as well as money, and would like to see J&J people working in academic labs. The goal for J&J’s four innovation centres is for each centre to deliver, in 3-4 years time, at least one clinical project per year with safety and efficacy data. He added that ideally he would like to see his team helping to establish new companies here in the UK.

Finally, Patrick commented that the amount of science in the UK and Boston area is probably the same. However, Boston has the big bioscience companies lining up to work with the academics in the area, more serial entrepreneurs, more examples to learn from and more competition. He doesn’t see companies lining up to work with academia in the UK. While he thinks it will take a bigger effort to help make a strong community here Patrick believes there is a bigger opportunity.

Louise Makin, CEO of BTG

Louise Makin, CEO of BTG

BIA members,

Late last month the Prime Minister invited me and five business colleagues to form a Business Task Force to “take a fresh look at the impact of EU regulations on British businesses”, in particular small to medium sized enterprises. Just over a week ago the Task Force, chaired by the Business Minister, Michael Fallon MP, met for the first time.

The purpose of this post is to ask you for evidence to help us identify concrete examples of European rules, regulations and practices where reform could benefit British business. We can all think of examples of unhelpful EU regulations such as the proposed ban on the use of refillable bottles and dipping bowls of olive oil at restaurant tables.

The task force is deliberately taking a pragmatic approach and we’re looking for fresh and practical suggestions. The more specific you can be the better. Areas of health and safety, employment law and company registration have been identified as of interest.

I am particularly interested to hear views about regulations relating to life sciences but if you have any comments relating to employment, chemicals, food safety and hygiene and the digital economy we would also welcome them.

I recognise that we’re entering the summer holiday period but this is a unique opportunity to make a significant difference so any assistance you can give would be much appreciated. The more evidence we receive, the better our chances of identifying reforms that could make a real difference to the growth prospects of British companies.

We are working to a tight timescale, and evidence is needed by 23 August. Any evidence of red tape you have can be submitted to us at EUregulations@btgplc.com.

I am also looking to form an industry focus group of CEOs to discuss identified areas of concern in life sciences over the summer.

Please contact Antonis Papasolomontos, Head of Public Affairs and Policy at the BIA or Ashley Tapp, Communications Manager at BTG if you are interested in participating in the focus group or have any other comments or questions.

Louise Makin
CEO
BTG plc

Dr Neil MurrayDr Neil Murray, Chief Executive of RedX Pharma, writes about the company’s recent Regional Growth Fund award.

The spectre of a US President trying to prevent the world’s largest economy plunging over a fiscal cliff dominated headlines at the start of this year, at which point the CEOs of any number of large pharma companies might have considered Obama relatively fortunate.

The challenge posed by drugs going over the patent cliff is part of the modern-day anatomy of big pharma. It cannot be negotiated away with a political quick fix in the small hours of the morning, and has revenue implications that can seem equally apocalyptic to investors.

Redx Pharma was established in 2010 to help meet the enormous challenge of creating the next wave of revenue generators.  In our view, we have only just started to see the industry’s R&D model change. As large pharma reduces its internal research capacity, there is a need for smaller, agile companies like our own to provide new drug programs to fill the pipeline gap that has arisen.  Our focus is on providing a lower risk and faster transition of promising compounds to valuable medicines.

The UK government’s Regional Growth Fund (RGF) has recognised the contribution we are making. It has provided in excess of £10m of backing which, along with substantial support from private investors, has helped us establish a subsidiary to develop new cancer drugs, Redx Oncology in Liverpool, and one focused on infectious diseases, Redx Anti-Infectives at Alderley Park, Cheshire.

The latest validation of our approach, RGF backing for a proposed third subsidiary focused on metabolic diseases, has put us in a position to create high value drugs to combat conditions such as heart disease, arthritis and diabetes. Collectively, they represent some of the most defining public health challenges of the developed world.

Our immediate focus is on delivering revenues from partnerships with pharma customers, across our pipeline, helping us to create a sustainable, dynamic business in the North West.

The Regional Growth Fund has made a very real contribution to the development of our business, and its endorsement of our plans has helped us attract substantial private sector investment. This latest award gives us another option as we seek to grow further and position Redx at the forefront of the new R&D model emerging in the industry.

white-mouse-in-purple-gloved-hands_220_440

Today the Home Office has released the latest annual statistics on UK research animal use. Chris Magee, Head of Policy and Media  at Understanding Animal Research, explains what the stats really show.

Public understanding of how and why animals are used in medical, veterinary and scientific research is essential if people are to have confidence in the regulatory system, and if they are to be protected from those groups who are wont to misrepresent the science, the scientists and the procedures themselves.

The annual statistics are typically accompanied by a ministerial statement but the real substance is to be found in the supplemental tables, which describe how many animals, of what species, are used for what general area of research.

These numbers reveal some interesting truths about animal research in the modern era. They reveal, for instance, that while the number of ‘procedures’ rose from 2011 by 8% to a total of 4.11 million, a large proportion is accounted for by breeding experiments, i.e. the birth of a genetically modified (GM) or a ‘harmful mutation’ (HM) mouse (e.g. strains with a mutation which allows them to be a useful model of disease). Around 48% of procedures were breeding experiments, an increase from last year’s proportion of 44%. Excluding these figures, the number of procedures involving normal animals actually decreased by 2%.

The stats also demonstrate a 3% rise in procedures undertaken for human medicine. They further reveal that 97% of experiments involved mice, rats, fish or birds, weighted heavily towards mice, whilst dogs, cats and non-human primates combined constituted only 0.2% of experiments.

Looking more long-term, we can see that there has been a 26% drop in procedures involving ‘normal’ animals since 1995, whereas procedures involving GM animals (mainly breeding experiments), have undergone a 7.86-fold increase. In 2012, for the first time, the number of procedures involving GM animals (1.91 million) was greater than the number performed on ‘normal’ animals (1.68 million). Thus, although the number of experiments appears to have remained stable, the nature of those experiments has been undergoing a quiet revolution.

Also hidden in the stats are the severity limits of project licences, which indicate how severe the intended procedures might be. Obviously, license applicants have a tendency to cater for a worst-case scenario to minimise the chances of exceeding the terms of their project licences, but it would appear that around 38% of procedures applied for in 2012 were mild, 58% moderate, 2% unclassified and just 1% substantial. These stats are surprisingly stable, and barely fluctuate year to year.

In the future it will be interesting to see the results of retrospective reporting of actual suffering (as opposed to licenses’ forecasts of potential suffering), which is expected from 2015. One could reasonably expect to see the ‘mild’ category expand as ‘moderate’ shrinks once the measure moves from over-cautious guesswork to careful recording. There were even plans, since abandoned as unnecessary admin, to introduce a ‘sub-mild’ category, since so many experiments end up involving less suffering than a blood sample. These experiments will remain in the ‘mild’ category.

What the stats will never tell us, however, is why individual experiments are undertaken and what cost/benefit analysis was applied to the project by the Home Office when granting the licence. This may be in part resolved through the publication of lay summaries of project licences. Publishing lay summaries both increases the disclosure of procedures undertaken (beyond those which are published in scientific journals) and, crucially, avoids the scientific jargon of a typical paper, which could confuse the general public and conceal the nature of procedures behind technical words.

The annual statistics dryly set out some of the costs of animal research whilst hinting at the benefits and in doing so constitute a neutral third-party document that punches a hole in many of the myths that surround animal research. With publication of lay summaries and the planned future reporting of actual severity, the true nature and context of animal research will be clearer and the general public will be better informed about the costs and benefits of animal research.

A summary and infographics of the 2012 statistics are available from Understanding Animal Research.

BIA CEO and Investor Forum July 2013

It was an incredibly busy week in the sector last week. Our CEO and Investor Forum in Herfordshire last week brought together ninety senior sector delegates. It was great to have such a lively and active debate on the opportunities and challenges facing the sector, particularly around financing and access to the public markets. Some of these will certainly feed into our upcoming work on a manifesto for the sector.

I was delighted that the Technology Strategy Board announced last week that the Biomedical Catalyst will reopen for applications for early- and late-stage awards on 29 July 2013 at One Nucleus OnHelix event. The news follows our successful campaign to get additional funding for the BMC. I know many of our member companies are waiting for the opportunity to make applications and I encourage them to prepare their applications as I am certain there will be strong demand once again.

Want to reduce cash burn? Accessing the UK’s world leading clinical research infrastructure can enable bioscience companies and their investors to accelerate clinical development. To help companies achieve this we, together with the National Institute for Health Research (NIHR) Office for Clinical Research Infrastructure (NOCRI), have published a guide for “Navigating England’s clinical research infrastructure: How NOCRI helps simplify access to accelerate discoveries“. I think of them as your “research sat-nav” – enabling you to speedily find your way around the clinical development highways and byways of the NHS. This booklet is a time and cash saver – it will help you speedily access the right expertise and the right facilities at the right time. Do take a look.

Most of our synthetic biology member companies were at the sixth international meeting on Synthetic Biology in London last week where David Willetts, Minister of State for Universities and Science, announced arrange of initiatives to support this emerging sector. The most eye-catching was that Imperial College is to host SynbiCITE – a new £10 million Innovation and Knowledge Centre for synthetic biology. The BIA supported Imperial College’s bid and we look forward to working with them developing this centre of national importance. Most of our synbio member companies also presented at SynbioBeta – the start up company focussed event and there was a real buzz about this emerging group.

Finally, I am hoping that some of you could assist us. Last week Louise Makin, CEO of BIA member BTG, attended the government’s business-led taskforce on EU regulation hosted by Prime Minister David Cameron in Number 10 Downing Street, on behalf of the life science sector. The group is tasked with helping identify where action is most needed to roll back EU red tape with life sciences one of the sectors of focus. We would like to pull together a group of CEOs from small- and medium-sized member companies as a focus group to feed into this process. Please contact Antonis Papasolomontos if you are interested in contributing.

We’ve a busy range of events planned for the second half of the year which I plan to unveil on this Thursday’s webinar – do join me to find out more.

Best
Steve