Sometimes the innovation community can be a tough insider’s club. If you’re a biotech startup, you’re only real when Merck/Pfizer/Novartis/Glaxo/Roche or some big VC like Kleiner Perkins bets cash that says you might be real. So sometimes a potentially groundbreaking idea has to find some other way to get critical support. That’s what San Francisco-based Jennerex is doing.
This startup, founded in 2005, has raised $45 million from a group of wealthy individuals and struck three key partnerships with pharmaceutical companies that aren’t exactly household names in this country—South Korea-based Green Cross, China-based Lee’s Pharmaceuticals, and France-based Transgene.
This cast of unusual suspects is setting out to do something that lots of scientists—including those at Emeryville, CA-based Onyx Pharmaceuticals and South San Francisco-based Cell Genesys—have failed to accomplish in the past. Jennerex, like those companies once did, is betting on the intriguing concept of oncolytic viruses. These are viruses that are genetically modified to replicate strictly inside tumors, killing tumor masses from the inside out, while also sparking the immune system to hunt down any residual cancer cells that have spread throughout the body.
No one has yet secured an FDA approval for a cancer drug that works this way, despite lots of trying, so people have a right to be skeptical. But Jennerex has scored some new validation for a new variation on this theme, via a $116 million partnership announced this week with Transgene. That’s enabling Jennerex to lay the groundwork for the next serious step—the third of three stages of clinical trials needed to win FDA approval. If Jennerex’s team of 40 people have learned from the mistakes of the past, they could be sitting on a treatment that fights all sorts of solid tumors—starting with liver and colorectal cancer. And if that Phase III trial delivers proof that its treatment can extend lives, Jennerex will have done it without giving up massive ownership stakes and control to Big Pharma or VCs along the way.
“Everybody acknowledges this has phenomenal potential,” says Jennerex CEO David Kirn. “Everybody is interested and wants to talk to us, but in terms of putting big money down, Big Pharma wants to see want randomized survival data with at least 80 to 100 patients. Once we have that, or have an FDA approval, it will break this field wide open.”
“It’s really too novel for big companies to bite off just yet,” he adds.
Kirn knows all the players quite well, having pursued this idea personally for a long time. He’s an oncologist, currently an adjunct professor for Oxford University, and a veteran from the early days of Onyx Pharmaceuticals. He pushed for the oncolytic virus approach there in the 1990s, just like he is pushing for it today at Jennerex.
Of course, this isn’t just one committed guy at Jennerex up against a wall of resistance from Big Pharma. Woburn, MA-based BioVex raised $70 million in venture capital last year for its oncolytic virus treatment, which is currently being tested in the pivotal stage of clinical trials for patients with melanoma. Calgary, AB-based Oncolytics Biotech (NASDAQ: ONCY) is also in the hunt, as well as more than 100 academic groups around the world, Kirn says. BioVex and Jennerex appear to be the leaders in the field at the moment, he adds.
So what’s new and different with this new crop of oncolytic viruses? Oncolytic viruses of the past tended to be safe and show some activity, but they had a delivery problem, Kirn says. They were essentially injected straight into bulky tumors that show up on an X-ray, like those in the liver, lungs, or breast. But since most people get treatment when their cancer has spread throughout the body, there was only marginal benefit in shrinking the localized tumor, as the cancer was usually destined to return.
“With something that requires local or regional injection, you’ve got a niche product, not a blockbuster,” Kirn says. “To have a blockbuster, you need to be able to use it against widely metastatic cancers. It makes it really hard to finance, and hard to do partnerships.”
What Jennerex has done, with its lead candidate JX-594, is attempt to solve that delivery problem. The oncolytic virus treatment is designed to be given as an intravenous infusion, that circulates throughout the bloodstream, and can be given once every couple weeks on a visit to the doctor, Kirn says. Plus, Jennerex has designed the treatment so it can be given as a “boost” through a localized injection into the patient’s most conspicuous tumors. It’s given through a 3-D array syringe that’s supposed to make sure the virus can “de-bulk” that big tumor, while simultaneously circulating throughout the body and mopping up any cancer cells that were missed by the local injection.
The Jennerex treatment has been given to about 90 patients to date, Kirn says. The data from those small studies suggests, like with most oncolytic viruses, that it’s well-tolerated with patients usually getting flu-like symptoms in the first 24 hours after an injection but little else. That’s pretty mild by cancer drug standards. But the real proof, which Kirn acknowledges, will come when Jennerex can show its treatment helps patients actually live longer with that kind of mild side effect profile. Jennerex reported on some preliminary findings, from a study of 24 patients with liver cancer, in which three-fourths of patients on a high dose of its drug were still alive after six and 12 months, which was a higher survival rate than researchers have seen in past studies. While that finding, presented at the European Association for the Study of the Liver (EASL) is intriguing, Jennerex will have to clear a higher bar in which patients are randomly assigned to get its treatment or something else, to prove it can help people live longer.
That trial, naturally, will take a lot of time and money. Jennerex is working with its new partner, Transgene, on the design of a couple of such randomized studies that could be good enough to win approval from U.S. and European regulators. The program should start enrolling patients in the second half of 2011, Kirn says.
In the meantime, Jennerex still has plenty of work to do. It will continue working on building up its pipeline of drug candidates behind JX-594, so it doesn’t become a “one-trick pony,” Kirn says. And he will be rooting for his rivals at BioVex to score a breakthrough in their pivotal trial, which has potential to spark renewed interest in the field. If that happens, the dealmakers and Big Pharma will certainly look around for another drug like that to scarf up for their own pipelines. And then Kirn says, he’ll be bargaining from a position of strength.
“We really wanted to retain a lot more ownership and control to build the company the right way,” Kirn says. “The promise of this platform is huge, and we wanted to build it methodically and have multiple products and not become a one trick pony like VCs sometimes put pressure on companies to do.”
While you might not know it from reading the latest news in cancer drug development, Kirn insists that oncolytic viruses could someday be bigger than the targeted antibody drugs that created a $30 billion a year industry and made Roche/Genentech into the world’s biggest maker of cancer drugs.
“When this hits,” Kirn says. “It will be bigger than monoclonal antibodies.”