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remain stable in the bloodstream, and that “they get in cells, and stay in cells.” After more than 400 patients have been dosed in a variety of clinical trials, there haven’t been signs of any immune-reactions against the compounds, he says.
Garabedian says he wasn’t interested in taking the CEO job himself at first, but a few key things came together when he was approached by other members of the board. First, he saw what he thought was convincing data that AVI Biopharma had proven its scientific concept with its RNA-based treatment for Duchenne Muscular Dystrophy—that it could help patients produce more of the vital dystrophin protein they need to maintain muscle function. AVI had also done some eye-opening animal trial work against the deadly Ebola and Marburg viruses, profiled recently in The New Yorker, which has enabled the company to line up $300 million in government R&D contracts. All of AVI’s drugs are 100 percent owned, and unencumbered by licensing deals with Big Pharma, giving the next CEO a lot of flexibility—Uncle Sam is paying much of the bills, and the CEO will have a lot of latitude in deciding what to do with them.
Looking at that pipeline, Garabedian saw potential for AVI to follow a model like that of Cheshire, CT-based Alexion Pharmaceuticals (NASDAQ: ALXN), which has one approved drug for a very rare disease, for which it charges a lot of money. The same path could be said for Duchenne Muscular Dystrophy, which affects about 31,000 people in the U.S., Europe and Japan.
Alexion has shown it can build a company worth more than $8 billion for treating patients with a rare blood disorder. Garabedian wanted assurance from the board that he wouldn’t have to do a quick partnership with a Big Pharma or Big Biotech company to bring in cash—that AVI could chart a course to develop its Duchenne drug completely on its own, or possibly with the help of a partner outside North America after it has a chance to build up a more convincing body of evidence to drive up the price.
“I told them I don’t think we’ll get full value of the program if we partner now,” Garabedian says.
With that basic idea, of building an independent drug developer around a potentially lucrative niche in Duchenne Muscular Dystrophy, Garabedian has been off to the races. He started by pitching the company to a lot of new investors at the JP Morgan Healthcare Conference in January. He brought in a couple of key executives—Peter Linsley as the new chief scientific officer, and Effie Toshav as senior vice president and general counsel. The company raised another $32 million in cash through a stock offering.
Garabedian—who has found an apartment in Bellevue because he says it’s halfway between Sea-Tac International Airport and AVI’s offices in Bothell—has been flying all over the world to meet with key scientific leaders and investors. The AVI team has been given marching orders to do critical experiments that the FDA wants to see in new drug applications—things like long-term animal safety studies and consistent/scalable manufacturing processes—which he says were languishing.
Much of this work is supposed to come to a head by the first quarter of 2012, when Garabedian says he wants to see AVI ready to go into a mid-stage clinical trial of patients with Duchenne Muscular Dystrophy, which could produce proof far more convincing of the drug’s benefit than it has today.
If AVI is ever going to get there, it will take a lot of the proverbial blood, sweat, and tears—plus time and money. That vision of becoming a multi-billion company isn’t something that Garabedian sees himself executing on with a “quick flip.” While most biotech companies are essentially built to be sold to Big Pharma companies, he insists he’s pursuing something bigger and more enduring.
“Seattle is going through a bit of a resurgence with Dendreon’s success and Seattle Genetics’ success,” Garabedian says. “We hope to be another one of those companies.”
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