VBI Progressing with Vaccines That Don’t Require Refrigeration

3/24/11

Expect to hear more about the vaccine developer VBI this year. The company has made some progress in addressing a major bugaboo in the vaccine field—the need to keep the vast majority of them at cool or freezing temperatures or risk spoilage.

VBI (formerly called Variation Biotechnologies), which moved its headquarters from Canada to offices closer to its venture backers in Cambridge, MA, in 2009, has been in potential partnership talks with large vaccine manufacturers and also expects to raise an additional round of venture capital this year, chief executive Jeff Baxter tells me. Recent interest in the company might stem from preclinical data on its lead vaccine for influenza, which showed that it could remain effective after enduring a year of storage in a hot environment. Today’s flu vaccines would become worthless if stored in such conditions.

Global health advocates have been calling for the development of thermostable vaccines (which are those that don’t require refrigeration) for years, and organizations such as the Seattle-based Bill & Melinda Gates Foundation have poured millions of dollars into research that could lead to such treatments. But the scientists and industry haven’t been able to bring to market thermostable vaccines for many of the world’s most devastating infections. In a December interview with the New York Times, Bill Gates said: “Back then (five years ago), I thought: ‘Wow – we’ll have a bunch of thermostable vaccines by 2010.’ But we’re not even close to that. I’d be surprised if we have even one by 2015.”

Earlier this month, Gates’s foundation, which typically provides grant funding, said it made an unprecedented equity investment of $10 million of in Research Triangle Park, NC-based Liquidia Technologies, after showing particular interest in the company’s way of manufacturing nanoparticle vaccines.

To hear VBI’s Baxter tell it, the need for thermostable vaccines exists in both the developing world, where cold storage in many areas can be difficult, and in established markets in North America and Europe. Many remote parts of Africa, for example, lack stable sources of electricity to keep refrigerators and freezers running around the clock. The problems with cold vaccine storage aren’t entirely limited to Africa, either. Vaccines spoil in the States too, sometimes leading to outbreaks.

Now VBI appears to have a shot at delivering on the promise of thermostable vaccines. Its thermostable vaccine for flu virus is expected to be ready for human trials in less than a year. At the same time, the company says that its proprietary way of formulating vaccines to keep them thermostable can be applied to both existing and developmental vaccines. And Baxter says that, unlike some of his competitors, his firm’s technology requires an extra step at the end of current processes for manufacturing vaccines and doesn’t require any changes at earlier stages of production.

“This will be one of those things where once thermostable vaccines start extending the current market, then very quickly you will see thermostable vaccines becoming the norm,” Baxter said. “Because it is such a competitive advantage to take vaccines out of the cold chain and to reduce the risk of spoilage.”

Heat alters the molecular structure of traditional vaccines and protein drugs, which are reliant on the shape of the molecules to be effective. VBI’s technology is designed to keep vaccine antigens stable inside separate particles during swings in temperature.

Baxter, a former managing partner of a Bay Area venture firm called The Column Group, took over as CEO of VBI in September 2009. Shortly after he took the helm at the startup, the biotech company initiated its lead vaccine program for seasonal flu. In addition to its injected flu vaccine, the firm is researching formulations of vaccines for flu and Shigella, which can be taken orally, not through an injection. Its other vaccine programs include ones for hepatitis A and cytomegalovirus, which can be passed from pregnant women to fetuses and cause birth defects.

The firm has developed way of entrapping vaccine antigens inside of liposomal-based particles. Baxter described the technology in simple terms as like a “soap bubble” that protects antigens from heat exposure. His firm says that its flu vaccine remains stable after up to a year of storage at the relatively hot temperatures of 104 degrees Fahrenheit (or 40 degrees Celsius). The company has also shown that its vaccine formulation can be frozen and thawed multiple times and remain effective.

Based on the firm’s early promise, VBI raised a Series A round of $35.7 million in January 2007 from a syndicate of venture backers that included 5AM Ventures, Arch Venture Partners, and Clarus Ventures. Baxter says that a condition of the financing was for the company to establish an office in the Boston area, where lead investor Clarus of Cambridge is headquartered. Yet the company has kept its research operations and most of its employees in Ottawa.  VBI is now planning to raise a Series B round of venture capital in the middle of this year, Baxter says.

Given the high costs of vaccine development, Baxter sees the quickest route to the market through a partnership with an existing vaccine manufacturer. While he didn’t have anything to report on that front, he mentioned that his firm has had discussions with all of the major vaccine players. (In fact, Baxter used to work for one of the largest vaccine producers, GlaxoSmithKline, where he held multiple jobs and finished his time at the London-based drug company as senior vice president of R&D finance and operations).

According to Baxter, companies have had trouble commercializing vaccines that don’t require refrigeration because their technologies require re-engineering how vaccine antigens are manufactured. That can be expensive. VBI, on the other hand, can apply its technology to existing vaccines that are “off the shelf,” Baxter says, so their technology wouldn’t require investments in altering antigen production, he says.

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