Print
Email
Print Edition Stories
MHT's Marc Songini: Technology to keep seniors healthy
MHT's Galen Moore: Charities score with online fundraising
MHT managing editor Rodney Brown on NECN: 22 tech companies give back to community
Disease foundations that are taking an increasing role in capital formation for local biotechs are nervously watching as the stock market and private capital markets wreak havoc with the companies that may hold the key to their future cures.
The Cystic Fibrosis Foundation, for example, has had a tough six months. Cambridge-based Altus Pharmaceuticals Inc. abandoned a Phase 3 clinical trial for a cystic fibrosis drug target, a move that breached the terms of a collaboration between Altus and the foundation. Financial woes that forced Altus to lay off 107 employees in January also prompted the company to choose an earlier-stage drug target with a larger potential market, rather than its potential treatment for CF, which affects just 30,000 people nationwide. Per a previous arrangement, the intellectual property reverted to the foundation and, for the first time, the foundation found itself conducting a clinical trial, pouring an additional $3 million into the project to keep it going. The foundation scrambled to find a new home for the potential treatment, previously known as Trizytek, and landed on another small, Cambridge-based biotech company, Alnara Pharmaceuticals Inc., which counts several former Altus officials as employees.
Diana Wetmore, the vice president of alliance management at the Cystic Fibrosis Foundation, has her hands full keeping an eye on corporate partners. She holds a Ph.D. in biochemistry, but says, “Yahoo Finance is the most visited website on my computer.”
The foundations, which uniformly say the only return on investment they seek is a treatment for patients, will often fund an interesting biotechnology that has a hard time getting venture capitalists to take the plunge. As capital markets have grown tighter, the disease foundations have become a lifeline in some cases. Foundations are being squeezed by companies that need support for longer periods of time and whose breakthrough therapies could be stranded by public and private markets that don’t always reward the best science.
For Wetmore another potential problem is on the horizon — its collaboration with a beleaguered Lexington company, Epix Pharmaceuticals. Epix announced in May that its stock was to be delisted by Nasdaq and has said it may not have enough cash to continue operations past August — a situation Wetmore said has her biting her nails.
The Michael J. Fox Foundation for Parkinson’s Disease Research hasn’t yet had any company breach the terms of its collaboration, but officials there said they are spending more resources on later-stage companies that, in the past, would have received funding from other sources by now. The Parkinson’s disease foundation has invested $20 million in Massachusetts biotechs, including deals with Alnylam Pharmaceuticals Inc. (Nasdaq: ALNY) and FoldRx Pharmaceuticals Inc., and Newton-based NeuroHealing Pharmaceuticals Inc.
“An important goal of the foundation is to fund early-stage work, but we are finding that what’s considered ‘early stage’ has expanded,” MJFF vice president of research Todd Sherer said. The organization now finds itself funding clinical trials whereas before it focused on preclinical research.
Peter Lomedico, the head of strategic alliances and partnerships at the Juvenile Diabetes Research Foundation, said the economic crisis is changing the way he chooses companies to fund. “There have been times we’ve had to walk away from some really good science, because the company is just too vulnerable financially.”
Partners in health
Examples of disease foundation and biotech research pairings
Cystic Fibrosis Foundation
Alnara Pharmaceuticals, Epix Pharmaceuticals,
FoldRx Pharmaceuticals
Michael J Fox Foundation for Parkinson’s Disease Research
Alnylam Pharmaceuticals, FoldRx Pharmaceuticals Inc., NeuroHealing, LINK Medicine and Codman & Shurtleff
Leukemia and Lymphoma Foundation
FoldRx Pharmaceuticals Inc.
Juvenile Diabetes Research Foundation
Tolerx Inc., Smart Cells Inc.
RSS Feeds
Comments
Please Login/Register to post comments.
No comments have been added or approved.