Championing the Business of Biotechnology in Canada

JULy / aUGUST 2013

cRacKinG ThE cOdEDiscovery of DnA's structure was made 60 years ago8

BiOTEch WiTh a viEWscenery and business make Vancouver a biotech hotspot10

haPPy annivERSaRyexclusive interview with Bayer Canada Ceo12

with a rapidly aging population,

companies are fi nding novel ways to fi ght debilitating disease

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inside

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looKing good For 150Bio Business sits down with Bayer Canada President and CEO Christian Lauterbach to discuss everything from the importance of a 150th anniversary, to the changing face of the industry to having difficult conversations with consumers.

editor's note 5neWs 6moments in time 22

smaller is betterVancouver’s thriving biotech community is undergoing an evolution with smaller, cash-efficient business models making an impact.

breaKing the Code oF liFe60 years ago Francis Crick and James Watson identified the structure of DNA, perhaps the most important scientific discovery of the century.

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FiGhTinG aGinGCanada’s seniors represent just 14 per cent of the population yet account for just under half of provincial and territorial government health spending. With the aging population growing, Bio Business looks at two companies trying to tackle age-related disease.

Championing the Business of Biotechnology in Canada

july / august 2013

cracking the codeDiscovery of DNA's structure was made 60 years ago8

Biotech with a viewScenery and business make Vancouver a biotech hotspot10

happy anniversaryExclusive interview with Bayer Canada CEO12

With a rapidly aging population,

companies are finding novel ways to fight debilitating disease

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The DefiniTive Source for Lab ProDucTS, newS anD DeveLoPmenTS

www.labusinessmag.com July / August 2013

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SpecialiZed foreSt machinery allowS U of t team to go higher

going it alone

Alberta researcher tries to prove

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thiS day in hiStoryCelebrating the 60th anniversary of DNA discovery

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do the FliP!It’s life in the treetops for these U of T researchers.

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EdiTOR'S note

bio business is a proud member of bioteCanada and life sciences ontario

Publisher oflab business magazinebio business magazine

Printed in Canada

PUBLiShER & cEO christopher J. Forbes cforbes@jesmar.com

EXEcUTivE EdiTOR Theresa Rogers trogers@jesmar.com

aSSOciaTE EdiTOR nicolas heffernan nheffernan@jesmar.com

STaFF WRiTER Lindsay Grummett lgrummett@jesmar.com

EdiTORiaL inTERnS chelsea Kowalski Joel Tansey

cOnTRiBUTOR christine Beyaert

aRT diREcTOR Katrina Teimourabadi kteimo@jesmar.com

SEcRETaRy/ TREaSURER Susan a. Browne

MaRKETinG Lisa PressaccoManaGER lpressacco@jesmar.com

MaRKETinG Keri LaPlantecO-ORdinaTOR klaplante@jesmar.com

vP OF PROdUcTiOn Roberta dick robertad@jesmar.com

PROdUcTiOn crystal himesManaGER chimes@jesmar.com

PROdUcTiOn Joanna ForbescO-ORdinaTOR jforbes@jesmar.com

Championing the Business of Biotechnology in Canada

Bio Business is published 6 times per year by Jesmar communications inc., 30 East Beaver creek Rd., Suite 202, Richmond hill, Ontario L4B 1J2. 905.886.5040 Fax: 905.886.6615 www.biobusinessmag.com One year subscription: canada $35.00, US $35.00 and foreign $95. Single copies $9.00. Please add GST/hST where applicable. Bio Business subscription and circulation enquiries: Garth atkinson, biondj16@publication partners.com Fax: 905.509.0735 Subscriptions to business address only. On occasion, our list is made available to organizations whose products or services may be of interest to you. if you’d rather not receive information, write to us at the address above or call 905.509.3511 The contents of this publication may not be reproduced either in part or in whole without the written consent of the publisher. GST Registration #R124380270.

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talking it outwhen I walked into Bayer Canada’s corporate offi ce and waited

for the company’s CEO to come down for our interview, I’m not going to lie, I was a bit apprehensive.

I was waiting to interview the CEO of a huge multinational pharmaceutical corporation. I was hoping for, but wasn’t expect-ing, interesting thought-provoking answers.

But Christian Lauterbach surprised me. His answers were thoughtful and eloquent and one of them in particular stood out. We were talking about how the public had lost faith in big pharma and how the industry had become an easy target for criticism. “I think we, as an industry, haven’t been able to explain why the five to 10 per cent investment that we ask for people to pay for drugs is a very good investment,” he told me. “So if you don’t have access to a certain drug, that’s fine but then you’re not going to get cured. Imagine you had never received that vaccine when you were young. Chances are some of us may not be sitting here today, but seriously, I think we need to have more of those conversations if we want to reset some of the mindsets.”

I left there thinking he was onto something. If drug companies talked to people in a real, meaningful way, they could bridge that knowledge gap.

Then I opened the paper and read about Eli Lilly escalating its lawsuit against the Canadian government to $500 million because the government denied the American giant’s patent application for Strattera, an ADHD drug, and Zyprexa, which is used to treat schizophrenia.

Lilly claims that Canadian Federal Court judges, using what the drug company calls a “promise doctrine,” are arguing that patents include too much scientific proof of the efficacy of a drug at early stages.

As part of the media, lord knows I’m not a huge fan of Health Canada and the gov-ernment, but to try and make this claim is ludicrous and the public backlash has been pre-dictable.

I’d love to see Lilly’s CEO, John C. Lechleiter, have this conversation with the public.

Nicolas HeffernanaSSOciaTE EdiTOR

canadian news

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canadian researcher dr. Edor Kabashi of the University of Montreal has developed the first animal model to study the function of a gene responsible for the highest percentage of aLS, commonly known as Lou Gehrig’s disease.

“Our results indicate that normal levels of a gene called c9ORF72 are crucial for the proper motor function of zebrafish, and loss of its function causes neurodegeneration,” explains Kabashi.

This is vital information, as aLS is caused by the death of motor neurons connecting the brain to the muscles. While the specific causes of aLS have eluded scientists for years, the announcement from Kabashi represents an important step forward, in hopes of finding new therapies and someday, a cure.

“canadian researchers are recognized internationally for discoveries that further our understanding of aLS,” said Lindee david, cEO, aLS canada. “it is a promising time for the aLS community. We are proud to support their work and are excited by dr. Kabashi’s findings.”

in 2011, two international consortia identified that mutations in c9ORF72 cause a higher percentage of familial and sporadic aLS than any other gene previously discovered. it was determined that the mutation makes up approximately one-third of all familial cases of aLS.

Following the important discovery, dr. Kabashi and dr. Pierre drapeau, also of Université de Montréal, were co-awarded the aLS canada-funded Bernice Ramsay discovery Grant to create zebrafish models of reduced and mutated c9ORF72. The purpose was to determine the gene’s role in motor function and ability to cause neurodegeneration. initial results from the research have recently been accepted for

bioteCanada and biotalent Canada Form PartnershiPBIOTECanada and BioTalent Canada have signed a milestone agreement enabling the two national organizations to collaborate to help Canada’s bio-economy. This new alliance enables all BIOTECanada’s members new services and access to BioTalent Canada's suite of human resource products, including the country's only national, bilingual biotechnology job board, “The PetriDish.”

Poor Patient deCisions Waste uP to $5.1 billion annuallyPoor decisions by Canadian patients waste up to $5.1 billion annually on prescription drugs according to Express Scripts Canada (ESC). Research from Express Scripts Canada’s report shows that poor patient decisions waste one out of every three dollars spent within a typical drug benefit plan. Sources of waste include channel waste and drug mix waste.

Prollenium launChes only dermal Filler FaCility in CanadaProllenium Medical Technologies Inc. opened its new facility, just north of Toronto, making it the only manufacturer of dermal fillers for tissue reconstruction in Canada. The new facility is the only automated syringe manufacturing and packaging line of viscous gels for implantation in Canada.

publication in the prestigious journal annals of neurology.

“To validate whether normal levels and/or function of c9ORF72 is essential for motor neuron health and activity, we developed an animal model to observe disease presentation in zebrafish,” said dr. Kabashi “We observed clear motor dysfunction, swimming defects, and abnormalities at the cellular level.”

All clinical lots have been produced and the trial will commence with interim results expected

in the summer of 2013.

ZEBRaFiSh PROvidE anSWERS TO ThE caUSE OF aLS

WORLdWidE news

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Lipaglyn is the first Glitazar to be approved in the world and the first ncE discovered and developed indigenously by an indian Pharma company.

The Zydus Group announced a breakthrough in its research efforts with Lipaglyn (Saroglitazar), a novel drug targeted at treating diabetic dyslipidemia or hypertriglyceridemia in Type ii diabetes, not controlled by statins alone. The drug has been approved for launch in india by the drug controller General of india (dcGi). With a novel action that offers lipid and glucose lowering effects in one molecule, Lipaglyn is the first Glitazar to be approved anywhere in the world.

diabetic dyslipidemia is a condition where a person is diabetic and has elevated levels of the total cholesterol, the “bad” low-density lipoprotein (LdL) cholesterol and the triglycerides and a decrease in the “good” high-density lipoprotein (hdL) cholesterol concentration in the blood. almost 85 to 97% of all diabetics are estimated to suffer from diabetic dyslipidemia. Lipaglyn – a non-thiazolidinedione, is the first therapy to be approved for this condition.

“Lipaglyn provides patients suffering from

diabetic dyslipidemia the option of a once-daily oral therapy that has a beneficial effect on both lipid parameters as well as glycemic control,” said Mr. Pankaj Patel, chairman and Managing director, Zydus cadila. “it has always been our dream to take a molecule right from the concept stage up to its launch. Today, we have realized this dream. it is an important breakthrough and i would like to dedicate this to all the indian research

glaxosmithKline's researCh ChieF in China Fired For data FraudJingwu Zhang, the head of GlaxoSmithKline’s R&D operation in China, has been fired while another researcher has resigned following a company probe into allegations that company investigators had “misrepresented” data on interleukin-7 research published in Nature Medicine. Three others were suspended from their jobs pending a final review by the company.

suPreme Court uPends Patentability oF genes, but not CdnaThe U.S. Supreme Court ruled against Myriad Genetics’ patent claims for breast cancer susceptibility genes BRCA 1 and 2 — but also holding that companies can patent composite DNA (cDNA) and other synthetic genetic material that does not meet the “product of nature” exemption from patentability.

Ferrer ComPletes Phase iii CliniCal trialFerrer, a privately-held Spanish pharmaceutical company with full vertical integration from R&D to distribution, announces today that it has successfully completed a phase III clinical trial in adult and paediatric patients with impetigo involving Ozenoxacin formulated as a topical treatment for dermatological infectious conditions.

ZydUS PiOnEERS india'S FiRST ncE TO REach MaRKET

scientists in the field of drug discovery.”discovered by the Zydus Research

centre, the dedicated ncE research arm of the group, Lipaglyn™ is a best-in-class

innovation, designed to have a unique cellular mechanism of action. With a predominant affinity to PPaR alpha isoform and moderate affinity to PPaR gamma isoform of PPaR nuclear receptor subfamily, the molecule has shown beneficial effects on

lipids and glycemic control without side effects. The ind was submitted in the year 2004.

Almost 85 to 97% of all diabetics are estimated to suffer from diabetic dyslipidemia.

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OnTaRiO GenoMiCs

on March 19, 1953, Francis Crick wrote to his 12-year-old son,

“My Dear Michael, Jim Watson and I have probably made a most important discovery.” The letter went on to describe one of the most meaningful breakthroughs in scientific history - identifying the structure of DNA. It is impossible to overstate the significance of this discovery, which revolutionized science and has had a profound impact on every aspect of our lives.

Thanks to this revelation, we can “read” the genetic blueprint of all living organisms by sequencing the four letters that make up DNA. Understanding life’s code has allowed us to make significant advances in many fields. We can pinpoint the cause of disease, target medications to individual genetic profiles, and ultimately take action to prevent illnesses. We are able to improve agriculture and livestock breeding, making our food better, more nutritious, and easier to produce. This knowledge has allowed us to identify and combat invasive species, clean up our environment, create biofuels, and more effectively use our natural resources. It has impacted our legal system through applied forensic science, and increased our knowledge of evolution and anthropology. The commercial development of genomics research is fueling our economy and helping address some of the world’s greatest challenges.

Watson and Crick’s model demonstrated how genetic instructions exist inside organisms and how they are passed from generation to generation. Understanding the structure of DNA has allowed us to genetically map out characteristics, to understand the differences and similarities between

UncOvERinG ThE SEcRET OF LiFE: 60 yEaRS aFTER ThE diScOvERy OF dna’S STRUcTURE

organisms of the same species and of different species, and speed up the rate of biological change.

Coincidentally, when they first published this discovery in Nature, Watson and Crick were reluctant to discuss DNA replication, simply stating, “It has not escaped our notice

that the specific pairing we have postulated immediately suggests a possible copying mechanism for the genetic material.” In a Nature editorial written 21 years later, Francis Crick discussed this modest explanation: “[Watson] suffered from periodic fears that the structure might be wrong and that he has made an ass of himself…but [I] insisted that something be put in the paper, otherwise someone else would certainly write to make the suggestion, assuming we had been too blind to see it.”

Despite its significance, their insight received little attention in the mainstream media. For example, the New York Times bumped the story from their May 16 edition to make room for “more important” news. This knowledge launched the molecular era, making today’s genomic technologies possible.

We are on the cusp of the genomic revolution, in large part thanks to an understanding of DNA’s structure.

Genetic information is being collected at an unprecedented speed. The Beijing Genomics Institute, the world’s largest sequencing facility, generates 250 gigabytes of data every hour. Sequencing whole genomes has become routine in research and new model genomes are being published weekly. To date, more

than 4,000 entire genomes have been made public, including everything from the mountain pine beetle to the golden delicious apple to pathogens such as tuberculosis.

Advances in sequencing technologies and bioinformatics tools are allowing us to gather and interpret this information, and apply our knowledge to real-world problems. Synthetic biology approaches are being used to develop manmade organisms that can produce biological products and renewable fuels. Microbial cultures are cleaning up contaminated groundwater. Rice has been genetically modified to solve issues related to vitamin A deficiency in the developing world. We can store large quantities of information in DNA, which we know is efficient, stable for long periods of time, includes automatic redundancy mechanisms, and likely to be relevant for the remainder of human history. All of these possibilities began 60 years ago, when Watson and Crick discovered the secret of life. BB

thanks to this revelation, we can “read” the genetic blueprint of all

living organisms by sequencing the four letters that make up DnA.

by Christine beyaert, manager, CorPorate CommuniCations, ontario genomiCs institute

September 30 - October 1 2013, The Hyatt Regency, Cambridge, MA

Join senior biotech executives to explore the most promising trends in stem cell, cell and gene therapies. This is your chance to get to know the top 20 next-to-launch biotechs. Co-located with World Cord Blood Congress and Cell Culture World Congress USA.

Robert HaririCEO, Cellular

Therapeutics DivisionCelgene

Mohammad HeidaranOffice of Cellular, Tissue & Gene Therapies, CBER

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Neuralstem

Confirmed speakers include:

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REGiOnaL profile

situated between vast mountain ranges and the Pacific Ocean, Vancouver is

a coastal community where business meets pleasure.

“Climate and scenery are nice to have,” says Jason Lesage, the manager of communications and public relations for LifeSciences BC. “But there’s also a lot of advantages for businesses.”

Ups and downsBritish Columbia has an increasingly strong business landscape where the province offers incentives to increase profitability for local companies and investors. Over the last eight years, more than 100 tax cuts have been introduced resulting in some of the lowest taxes in North America and with a provincial election having just passed, Lesage says Vancouver’s business climate will remain stable.

“They have a fresh mandate for four years to keep on improving the business environment and creating jobs. Not just in the traditional sectors like forestry, fisheries and mining, but now they’re increasingly paying attention and creating programs to foster the technology and life science sectors.”

Recently, however, a mass of negative national media has focused in on the province’s health sector after last year’s disclosure that the personal health data of four million British Columbian residents was breached.

The academic organization said to be involved in the Health Ministry’s breach, Therapeutics Initiative, has since been restricted from accessing data and had their provincial funding cut. Although national newspapers have suggested that the province has suspended its access to health data and halted research, but that’s far from the truth.

British Columbia has one of the largest sets of longitudinal health data in the world that covers a variety of areas including physician billings,

pharmaceuticals, mental health and more.

“Clinical trials are an important process. Researchers can use this data, go back in history and see how a drug has been used in a population,” says Lesage. “Obviously you look for side effects and how efficacious the drug is as well as a bunch of different metrics.”

Lesage confirms that this data is still available to organizations and researchers, and believes this controversy has positively impacted the healthcare sector by raising the profile on access and approval for new drugs.

industry landscapeBritish Columbia’s life sciences industry includes about 100 biopharmaceutical companies, 60 medical device manufacturing and distribution companies, and 30 bio products companies of which approximately 70 percent are located in the Vancouver area. The most active sector, biopharmaceuticals, generates roughly $800 million per year in revenues according to The Vancouver Economic Commission.

The BC life science industry has been in a state of flux over the last decade as it transitions from a space where major players in biopharmaceuticals like QLT

and Angiotech rule the field to an area comprised of smaller, collaborative businesses that are developing innovative research with the financial help of larger institutions, angel investors or partners.

“We are going through an evolution,” says Ali Tehrani the CEO of Zymeworks, a Vancouver-based biotech company. “Rather than having very large companies that burn a lot of cash, we’re going to a model where you have smaller companies that are much more cash efficient and cash intelligent.”

Zymeworks was created in 2003 when Tehrani saw a gap in the market in the area of biologics R&D. “This is not a spin out from a lab or my own research; this is basically seeing a market opportunity and chasing that,” says Tehrani.

The company focuses on developing antibody therapeutics for the treatment of oncology, autoimmunity and inflammatory diseases. ZymeCAD, the company’s platform technology, was used to develop their platform molecule Azymetric and in 2011 it caught the attention of Merck, one of the largest pharmaceutical companies in the world. “Every little company and start-up needs a notable, early adopter,” says Tehrani. “Validation brings additional financing and gives you the shot to live another day.”

In April, Zymeworks announced

VanCouVer’s bioteCh c LU S T E R

Don’t be fooled by its casual exterior, this city means business

by lindsay grummettPhoto From tourism VanCouVer

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REGiOnaL profile

its second research milestone in its collaboration with Merck. Under their agreement, Zymeworks is eligible to receive research, development and regulatory payments with a potential value of up to $187 million US plus royalties. “We can be a lot more innovative than big companies. That innovation is directly related to the fact that we can take more risks,” says Tehrani.

Vancouver has a large and diverse assemblage of angel investors ready to support the lofty ideas of these small businesses. These investors keep their money in the province thanks in part to the Small Business Venture Capital Act that affords eligible small businesses and investors with a tax credit up to 30 percent. In a 2010 survey done in part with UBC, 73.8 percent of angel investors that responded said they would invest less without the B.C. tax credit program and 41.3 percent said they would seek to invest more in the US.

Moving discovery to marketThe majority of the province’s life science industry is located in Vancouver where it’s sustained by a number of world renowned facilities. Many of the area’s universities, hospitals and organizations have been globally recognized for their research.

University of British Columbia (UBC) has spun-off more than 100 life sciences companies, creating more than 2,500 jobs and raising more than $2 billion in private investments. Other notable organizations include The Centre for Drug Research and Development (CDRD), The Michael Smith Foundation for Health Research (MSFHR), and the Vancouver Prostate Centre (VPC).

It’s estimated that local institutes conducting life science research attracted $424 million through various grants, investments and collaborations over the course of last year. Approximately $332 million of this amount was spent in BC.

“What you tend to find is you have really good research, but it’s often

difficult to translate it into people. Mice are not people. It’s the translation that’s key which is why you have groups like the Prostate Center,” says Scott Cormack, the CEO of Vancouver-born OncoGenex.

The Vancouver Prostate Centre is the largest program of its kind in Canada, and is recognized as one of the top prostate cancer research programs in the world. Cormack first learned of the Prostate Centre in 1998 while working with UBC to identify technologies that were either licensable or that could have companies formed around them.

After being connected by the university to Dr. Martin Gleave, a clinician-scientist and urologic surgeon at the VPC, a business was formed to facilitate the movement of the VPC’s research to market. There are approximately 140 clinical investigators working at the VPC many of whom are highly regarded in their respective fields.

“Having relationships with some of the world’s best investigators allows you access to patients and it also puts the drug profile on a podium. These guys are the ones who go to international conferences and get the attention of the rest of the world,” says Cormack.

OncoGenex’ develops and commercializes innovative therapies that have the potential to redefine treatment outcomes for patients with a variety of cancers. Thanks to the tight infrastructure, businesses like OncoGenex have been afforded the chance to thrive. “In the early days of biotech, nobody had yet failed and failure is good for the soul,” says Cormack. “It doesn’t necessarily teach you what to do, but it certainly teaches you what not to do.”

The company is currently in the midst of running 10 clinical trials for their two drugs. Three of the trials are in Phase Three and seven are in Phase Two. If the Phase Three trials succeed OncoGenex will receive a milestone payment from partner Teva Pharmaceuticals and will also be eligible for royalties at percentage rates ranging from the mid-teens to mid-twenties on net sales. This is a milestone indeed considering the continuum from Phase One to Three in oncology is roughly 10 to 12 years.

“When we started this it was a whole bunch of no’s and no ways and this will never be successful. Ten years later, we’re still here and if we can do it others can too,” says Zymework’s CEO. “All it takes is one yes.” BBAli Tehrani, CEO of Zymeworks

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EXcLUSivE interView

Having just recently celebrated a milestone of his own at Bayer,

Christian Lauterbach has a unique perspective as the global giant celebrates its 150th anniversary. Lauterbach joined Bayer Inc. over 25 years ago and has occupied numerous roles in various countries around the world. He’s been the President and CEO of Bayer in Canada for over a year and to help celebrate the organization’s milestone Bio Businessvisited the company’s Toronto office for an exclusive one-on-one interview to discuss Bayer turning 150, what’s changed in the industry during his time and how the sector can win the trust of consumers.

A 150th anniversary is a pretty big achievement especially in this industry. what does it say about Bayer that you’ve reached this milestone?I believe it says that we have found our core values that we work around, which are centred around research and innovation, which is why we have this motto of ‘Science for a better life’ and I think this gives everybody a nice orientation where to focus their energy around. The second thing is Bayer over the years has been able to reinvent itself because obviously the business we do now is very different than what we did 50 or 100 years ago. The ability to challenge the way you do things, challenge the things you do even on a constant basis to make sure that you stay in business in 10 years, 20 years from now and I believe that we have put processes and a good culture in place to do that. And the third piece, which I believe plays together with the second one, is you have a lot of

bigturning the

by niColas heFFernan people within Bayer who are career Bayer people and that fosters a culture of taking decisions for the long term.

what does ‘science for a better life’ mean to you?There’s obviously two parts in that: one is the science and there’s the for a better life piece. We have over 10,000 researchers who do nothing else but think about the science and say, ‘What are solutions to problems we have today or even tomorrow that we can try and come up with an answer to?’ Then you have everybody else in the company try and bring it to life because frankly having an innovation in the lab that doesn’t find its way into real life because you can’t produce it or you can’t get access to it for patients is of no value. I think it’s a very nice way of bringing it together in one sentence what is this super diverse company.

what motivates you to keep going in this area and company?Me and my career was always quite simple, as long as I can contribute and as long as I can learn something I’m going to stay and as soon as that ceases to happen I’m going to go somewhere else. And lucky for me I was awarded great opportunities to work in different countries, to work on different disease areas, on bringing new medicines on to markets.

How did you find the transition becoming the Ceo in Canada? what have you been able to accomplish?First of all it was surprising because as usual in Bayer these opportunities come up without too much of a forewarning.

we have over

10,000 researchers who do

nothing else but think about the science and say, ‘what are

solutions to problems we have today or even tomorrow that we can try and come up with

an answer to?’

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What I believe is great in Canada is, as I like to put it, to me the world meets in Canada. What I think I’m able to contribute is I’ve worked in Asia, in Europe, I’ve worked in different places and to bring those different viewpoints and to mix those with what I find here I think matches very nicely. The second thing which I find here is Canada is, at least our company, is very team oriented, very much consensus, team oriented and that suits my management style very well. Lastly promote Canada internationally as well within our company.

How has the industry changed in the 25 years you’ve been involved?The industry has come back to focusing more on the value of its medicines and I think we may have gotten too focussed on some of the financial aspects, in particular in times where the healthcare systems across the world are challenged with financial resources. Our role as the innovative health care part of the industry is to bring innovation out there, that’s our mandate, and to work with the different stakeholders in government and academia to show the value of the medical interventions we have and how we can help contributing to actually managing better outcomes and also managing costs at the end of the day. So I think you’ll see a refocusing on this and it’s not over, it’s a quite a challenge for us as an industry to reposition ourselves that way.

How do you go about repositioning Bayer/pharma industry?One is the way we communicate – not only communicating about the sales potential about your drugs but communicating

more about what is it actually doing for the patients that are affected. The second one is to work with the stakeholders... to bring more real life evidence which I believe is very, very important. And then to show that to society and also the payers, you know what, this is actually a worthwhile investment we do for the patients that we have to treat. And this is a little bit of a different mindset because it shows that you have to continuously work on your drug from discovery actually to bringing it on to the market and beyond.

where do you think the industry is moving towards now? what’s in the future?I believe industry is moving to more focus on real life evidence because doing just your drug approval is not going to be good enough... and moving to more partnerships, not only amongst industry, but also increasingly with the payers in a different way because clearly the financial challenges are very evident across the world. But there is a hunger and thirst for innovation out there because these diseases that still warrant a cure and better treatment, the need is still clearly there and so these different types of partnerships I firmly believe will increase and also will increase in how we source and how we bring forward innovation. I think the days where you work in your own little lab on innovation all on your own are gone. It has to go even further across big pharma, biotech, small pharma, academia... as it becomes more and more challenging to find better solutions. Lastly the industry will have to demonstrate more and more that what we do brings value because otherwise

society’s not going to pay for it and to me that comes back to the clinical value that you have to demonstrate but also the way you act in the health care system.

why do you think the value is being challenged?I believe that the overall economical challenges that the health care systems have they are difficult to explain to the general public and they are very, very multifaceted and I think we as an industry haven’t been able to explain why the 5-10% investment that we ask for people to pay for drugs in that case is a very good investment. So what we see happening very often from a political and very broad level is us being attacked as being more of the problem rather than the solution, whereas if you look at the facts we are actually not contributing 90 per cent of the costs we

Bayer CEO Christian Lauterbach was on hand at the Science for a Better Life Exhibition in Toronto to

celebrate the company’s 150th anniversary.

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are contributing a small per cent of the costs. But we are a comparatively easy target communication wise and we as an industry haven’t been able frankly to demonstrate the value and I think the only way for us as an industry is to actually talk more about the vale and the outcomes and also at times to tell people what the alternatives are. So if you don’t have access to a certain drug, that’s fine but then you’re not going to get cured. Imagine you didn’t have... back to our antibiotics, back to our vaccines, which I’m sure you got and that I got when we were kids, imagine you had never gotten that vaccine when you were young, chances are some of us may not be sitting here today but seriously I think we need to have more of those conversations if we want to reset some of the mindsets.

How have the cuts to basic science in Canada affected Bayer?It doesn’t affect us directly in the short term but it will affect Canada in the long term for sure. If you go back to

the decision making process of global companies: first of all they look at where do I find the strong science base and the base of researchers that can help me to partner and then to bring the idea of a new medicine, if it is a medical area, or this idea of a new solution to make wheat more efficient, if it was in the crop science area, you need strong partners to deal with. I believe the funding of basic research that Canada is doing, maybe not to the extent it should be doing, provides that basis, provides the young people an incentive to go into academia and science, and therefore build a strong base of people that in the future can work with companies like us. So therefore in the long term it is an issue because I think what Canada needs to realise is Canada’s in competition with other strong knowledge-based economies. You see big, big players like many of the emerging market players that are investing a lot, you see the traditional players like the US and some of the Europeans for sure and I believe Canada needs to see beyond

the big oil and gas industry. Where’s the next future stronghold? And life sciences certainly could be one and so investing and continue to invest in science and basic research is one important element.

How has Bayer’s r&D model changed over the years?What we have done over the years is we have focussed our areas. As research and development has gotten so much more complex and expensive I don’t think you can be an expert in all areas so we have decided for us it’s oncology, it’s cardiology and it’s women’s health. I believe R&D has gotten much more international than certainly 20 years ago. We have a network of development of R&D countries across the world to tap into the strong research networks and again for Canada it’s a great opportunity. You have built into the society a very international base so for companies like ours this is a great starting point and again I believe Canada has more opportunity than it’s currently leveraging. BB

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More and more Canadians are aging gracefully, but they’re not doing it

cheaply.A report by Certified General

Accountants (CGA) estimates the cost of health care increasing by $70 billion over the next 20 years because of Canada’s aging population.

Canada’s seniors are costing more than any other segment of the population, representing just 14% of the population, but using 40 per cent of hospital services in the country and accounting for about

45% of all provincial and territorial government health spending. With the number of Canadians age 65 and older expected to nearly double to 25% by 2036 the health care system will face yet more strain.

The number of seniors taking multiple drugs is also on the rise. In 2009, 63% Canadians age 65 and older took five or more prescription drugs from different drug classes, with 23% taking 10 or more—up from 59% and 20%, respectively, in 2002. The risk of

developing chronic conditions grows with age as well, with 76% of seniors reported at least one of 11 major chronic conditions in 2008.

Here are a look at two companies trying novel approaches to tackle age-related disease:

AGinG gracefu l lyWITH SENIORS

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by lindsay grummett

every day there are advancements in biomedical and pharmaceutical

treatments for the symptoms of disease. As science and technology improves, researchers are no longer satisfied with treatments that do not address the underlying issue and as a result independent labs across the world are stretching their scientific abilities in hopes of finding the Holy Grail.

“The next wave of biomedical research is actually addressing the underlying causes of diseases and harnessing the human body’s innate ability to provide cures,” says the executive VP of business development at International Stem Cell Corporation (ISCO), Simon Craw.

The company is approaching the curative movement with a new type of stem cell technology that has the scientific potential to change the world and our reactionary approach to disease. This technology has been applied to a variety of diseases; however, their most advanced program is neurology which focuses primarily on Parkinson’s disease as well as other age-related issues.

Following her daughter’s death from diabetes, Dr. Elena Revazova was determined to find a cure. She moved to the United States from her native Russia where she worked as a leading cell biologist. Unable to find a job in research, Revazova settled for working as a volunteer research scientist at the University of California, Los Angeles.

“She wanted to use stem cell technology to develop treatments, but she was also a very religious individual. She felt very strongly about not wanting to cross the ethical boundary of using embryonic stem cells,” says Craw.

In time, Revazova discovered a way to create stem cells lines without fertilizing the human egg through a process called parthenogenesis.

“Elena found she could develop eggs up to about five days,” says Craw. “They wouldn’t develop any further because they come from unfertilized eggs so there’s no male genome. But you can get to a stage where they have stem cells.”

This powerful new stem cell technology can significantly advance the field of regenerative medicine by addressing the problem of immune-rejection. A relatively small number of

parthenogenetic stem cell lines could provide immune-matched cells for a large percentage of the world’s population.

She published her discovery in the Cloning and Stem Cells journal in 2007 and then founded ISCO where they’ve been building on the foundation of her discovery every since.

The company’s therapeutic research is divided into three general areas: neurology, ophthalmology and liver-diabetes (combined due to the close cellular connection of the liver and pancreas). Parkinson’s disease has proved to be the company’s most promising research focus due to its localized impact on the brain.

This disease is, in part, characterized by the death of dopaminergic neurons in the portion of the brain called the pars compacta of the substantia nigra. As the brain cells in this area begin to die the amount of dopamine being produced is also reduced.

“The movement disorders, the tremors, the dyskinesis are all related to the death of one particular kind of neuron,” says Craw.

ISCO’s novel stem cell based therapy uses human parthenogenetic neural stem cells that are self-renewing multipotent cells.

“Our thesis is that when we implant these neural stem cells, they’ll essentially grow and replace the damaged neurons in the Parkinson’s disease patients alleviating the symptoms of the disease by regenerating that area of the brain,” says Craw.

ISCO researchers have already completed testing in rodents as well as primates with extremely positive results. In the case of the primates, ISCO showed that cells can be safely implanted into the brain without any adverse effects while also alleviating the symptoms of the

disease. Craw says the company is likely to start their first Stage One trial at the beginning of next year.

“We’ve been working on this for about three or four years,” he says. “So to get to this stage is extremely exciting.”

Located in California, International Stem Cell Corporation is one of the few US-based stem cell companies that accept no government funding. Instead it uses revenue from sales of commercial products developed in ISCO’s offshoots: Lifeline Skincare and Lifeline Cell Technology.

Lifeline Cell Technology sells human cells and growth factors to researchers in universities, pharmaceutical companies and hospitals, while Lifeline Skincare produces and sells cosmetics using stem cell extracts. The company spent two years developing a process to extract the necessary proteins that would benefit the skin. Craw says skincare sales have been increasing over the past two years since the product’s release. With all income derived from Lifeline sales going directly to fund the company’s research programs, the cosmetic and cell sales play an important role in furthering ISCO’s Parkinson’s disease program.

Most biotechnology companies are feeling the financial crunch with the amount of capital raised in the industry falling by about 15% in North America and Europe in 2012. However, ISCOs business model promises continued funding and a chance for the company to further the dreams of its founder, Dr. Elena Revazova, who is now in her 70’s and retired from the business.

“With Parkinson’s, we’re not giving you a drug to mask the symptoms of the underlying disease which is how Parkinson’s is controlled at the moment. We’re providing a cure. It’s a whole paradigm shift in biomedical research.” BB

Driven by religion and heartache, one woman’s mission to find a cure for diabetes leads to her creation of the first non-embryonic human stem cell.

CURET h E S E a R c h F O R T h E

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The Voice of

in OntarioLife Sciences

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ViDA Therapeutics might have stumbled upon the fountain of youth.

The Vancouver-based company has developed technology that allows them to inhibit an enzyme that attacks a key substrate of collagen, reversing the aged and wrinkled look of skin. Granzymes also attack tissue and vascular integrity, implicating them in a number of inflammatory and age-related diseases.

The company’s scientific founder, Dr. David Granville, discovered Granzyme B (GzmB) targets key substrates of the extracellular matrix, basically the infrastructure that tissue relies on. One substrate was a proteoglycan, decorin, which organizes collagen into tight, thick bundles and is abundant in most connective tissues. With the absence of decorin the collagen fibrils become disorganized leading to a loss of collagen tensile strength.

“When we block out the GzmB, decorin actually returns and with that return of decorin the collagen is then remodelled or reorganised back into its natural weave pattern,” says viDA President and CEO Alistair Duncan. “So what we’re seeing is a healthy, robust tissue present in the model.”

But viDA took a circuitous route to get to sip from the fountain. The company’s initial breakthrough came in the cardiovascular area when Granville, a cardio pathologist, was studying the implications of inhibiting GzmB on mice with an abdominal aortic aneurism in late 2008 early 2009. He noted when GzmB

f o r e v e r

was inhibited the aneurisms could be attenuated in a dose-dependent manner. But knowing the path to market in the cardiovascular arena would be expensive and time consuming, the company looked for a different commercial avenue. “It was very exciting except for the fact

that it was cardiovascular and that’s a very tough area to get a company up and running on,” says Duncan.

Undeterred, Granville went back to work and noted how supple the skin of the mice looked, which led to the discovery of GzmB’s affect on the skin. It’s through developing topical cream inhibitors of GzmB that Duncan hopes to get to market.

“The idea here is that we will have the inhibitors, we will show proof of concept of the value of inhibiting GzmB in a dermatological setting, and then [since we’ll] have data showing the system of delivering an inhibitor, [we can have] a role in treating a relevant disease,” says Duncan.

While viDA may have stumbled upon the fountain of youth, GzmB also plays a significant role in numerous chronic inflammatory, auto immune, fibrotic and age-related diseases. “Normal, healthy people have a very small amount of extracellular GzmB floating around,” he says. “The granzyme levels go up multifold in an individual that’s been subjected to some kind of chronic inflammatory disease. If you look at rheumatoid arthritis, in the synovial

Vancouver company hopes to tap into the fountain of youth by inhibiting key enzymeby niColas heFFernan

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with the absence of decorin the collagen fibrils become

disorganized leading to a loss of collagen tensile strength.

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fluids granzyme levels are up 160-fold.” Chronic injury and aging also leads to an increase in levels.

Right now the company is still preclinical but just closed a $1.8 million financing round led by BDC Venture Capital and included support from a number of angel investors. Duncan says the company is looking to bring in $8 million to $10 million that would allow viDA to accelerate its clinical program.

“As the company continues to go down this path of preclinical research, it does open up a significant opportunity because all the models that we’re working in are all representative of very large therapeutic markets,” says Duncan.

On top of the library of proprietary inhibitors for dermatology, viDA is also investigating licensing transactions that could move parts of the platform into the hands of others that are targeting other indications. viDA is also developing a biological inhibitor program and a small molecule program.

“The hope is we’re delivering a treatment for what ails,” says Duncan. “If you’re talking about the ability to go into the wound care sector, we’d hope we’d have a topical formulation that would be able to start addressing chronic wounds. If we’re able to go in and demonstrate the efficacy in some of our rheumatoid arthritis work, we’re looking to come with another tool to deal with RA. If you have a particular chronic inflammatory disease... if you can bring (GzmB) levels down in a manner that allows for healing and remodelling, that would be of great value to the patient.” BB

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This September marks the 10th anniversary of National Biotech Week, where the innovation and creativity of Canadian life science researchers and entrepreneurs is celebrated. The concept was initiated by BIOTECanada with the collaboration of all the provinces in Canada. Events held during the week of Sept. 20-27 include lectures, workshops, education outreach, facility tours, advocacy and networking. Municipal and provincial governments issue official proclamations to support Biotech Week. The objectives of the week include: highlighting the benefits of biotechnology to the general public, increasing business leaders’ awareness of Canada’s capacity in biotechnology; fostering relationships with local, provincial and federal politicians and promoting opportunities in the sciences to high school students. BB

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