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Torrey Pines Investment, Lichter says. Torrey Pines Investment, a San Diego life sciences investment firm, happens to own a full-service contract research organization near Moscow. AFraxis plans to begin tests in Russia in 2011 to evaluate the drug’s safety in humans, Lichter says. If all goes as planned, he says tests in Fragile X patients in Moscow will follow.
Nicolay Savchuk, a Russian-born mathematician and director of Torrey Pines Investment who also participated in the presentation, says his firm uses its ties with the Moscow-based Chemical Diversity Research Institute to focus “on the gap where [potential drug] compounds are and where they need to be.” Savchuk says his firm likes to invest in potential drug candidate “assets” and use its R&D capabilities to produce “data packages” that provide the validation necessary to eventually turn its assets into drugs.
Savchuk says the deal with Avalon and aFraxis was “unusual and out-of-the-box thinking” made possible because “Jay was very seductive” and offered Torrey Pines an opportunity to make a direct investment in aFraxis. In exchange for an equity stake in the San Diego biotech, Savchuk says his firm guaranteed to cover the costs of the pre-clinical research and development that was done by the Russian CRO.
“I would not say it’s a one-size-fits-all model,” Savchuk says. “But it is a way to do more.”
Lichter added that he personally reviewed the capabilities of the Russian CRO, and was deeply impressed by the institute’s “top-notch’ capabilities in medicinal chemistry, biology, and related fields of drug research and development. He says he also was assured by the fact that Savchuk lives and works “just down the street.” Lichter says the Russian CRO’s cost was competitive with Asian firms, but that Savchuk’s personal involvement was a crucial factor—and a principal reason why Lichter could not envision doing the same work with an unfamiliar CRO in India or China.
“There’s something to be said about good neighbors,” Savchuk agreed. “We saw these target-to-clinic capabilities [that we have] as a convenient way to de-risk [biotech] investments. It made sense to us and our partners to streamline costs as much as possible.”