e-Therapeutics: Daniel Elger. Pioneers of network pharmacology, a distinctive new approach to the discovery of medicines




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Video title: e-Therapeutics: Daniel Elger. Pioneers of network pharmacology, a distinctive new approach to the discovery of medicines
Released on: May 15, 2013. © PharmaTelevision Ltd
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In this episode of PharmaTelevision News Review, filmed at BioEurope Spring 2013, in Barcelona, Spain, Fintan Walton talks to Daniel Elger, CFO at e-Therapeutics.
Origins of e-Therapeutics
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here at BioEurope Spring, in Barcelona, in 2013. On this show I have Daniel Elger, who is CFO of a company called e-Therapeutics, welcome.
Daniel Elger:
Hi.
Fintan Walton:
Daniel, e-Therapeutics as I said is a UK company, can you tell us a little bit about the origins of e-Therapeutics?
Daniel Elger:
Yes, so e-Therapeutics was founded to exploit a particular new distinctive approach to the discovery of new medicines called network pharmacology, and this is an approach, it's really quite distinctive from mainstream discovery approaches used by most pharmaceutical companies, so to give you the essence of that this is a company whose origins lie in the science of complex systems, the CEO and founder Malcolm Young realized the potential to apply this in the context of drug discovery and set up the company to do that.
e-Therapeutics drug discovery and development
Fintan Walton:
So it's computer modeling of networks and of course or you know life forms are complex networks and mechanisms, biological mechanisms are complex networks and diseases arise from these complex networks, so what does the computational element bring to the understanding of those networks that allows you to discover drugs?
Daniel Elger:
Right, well just to pan back from that slightly, the fundamental principle here is as you rightly said that in the context of diseases it's not just one protein that goes wrong it's a whole network of proteins that become disordered and our approach is really about how to rationally target that whole network of proteins for a really profound therapeutic effect on the disease in question. Computers are a tool to do that, but I think it's important to realize that the fundamentals of our approach it's the different philosophy that's important, so rather than seeking to target a single protein or a single bad act that is thought to be behind a disease, we are about analyzing the entire network of proteins involved in a disease and then working out what are the best set of points in that network to hit simultaneously for a really big effect. Now computers come in because you need significant computing power to do the analysis to achieve that, to achieve that approach.
Fintan Walton:
Right, now I understand that the original concept was to look at existing drugs and basically repurpose them to fit the what the model had been you know throws out in terms of its potential targets as such?
Daniel Elger:
Yes really there are two ways you can go with this approach, so once you've analyzed a network and you have found the set up points that you want to hit in that network for an effect you can either go and look for an existing drug and screen for drugs whose direct and indirect effects on cellular processes include actions at the points you are looking for and that's repositioning, so that's going out finding drugs, maybe drugs that have reached the armamentarium for another disease, or drugs that have failed in development and recognizing their effects on networks are those that you are looking for in the new context, but one can equally, having identified how you want to target a network, seek to build a new chemical entity, a brand new drug that will have the effect that you are looking for and as the company has moved into its most recent phase of discovery work, particularly over the last couple of years we've been focusing more on coming up with brand new drugs, although we are still looking at repositioning opportunities as well, and the drugs we currently have in the clinic are repositioned agents.
e-Therapeutics products in clinical development
Fintan Walton:
Okay, just on, lets just talk about those first those products that you have in clinical, what therapeutic areas are you going for and why?
Daniel Elger:
Right, that's a good question, so when the company started it was looking at a very wide range of therapeutic areas, because really this, this approach is applicable in all areas of medicine so it was attempted in anti-infective settings, in CNS, in oncology. Now we've become more therapeutically focused so the new discovery work that's going on is particularly in oncology, and in CNS disorders especially in degenerative diseases of the nervous system. The compounds we have in the clinic at the moment are, there is a cancer drug ETS2101 which is currently in Phase I testing and we have an antidepressantETS6103 which just completed a Phase IIa study and it's shortly going to be starting a Phase IIb trial.
Fintan Walton:
Okay, both of those are you know when you get into Phase III clinical trials you get bit more expensive presumably you are looking for partners for those down stream?
Daniel Elger:
We are, so our general business model is that we take drugs through to the end of Phase II trials and then seek partners at that point for pivotal studies, registration and commercialization and that's what we planned to do with both of these drugs. The anti-depressant as I mentioned is more advanced in the clinic in terms of stage, but the cancer drug is the drug that we see as the much the bigger commercial opportunity of these two and that's been a major focus when we were seeking to raise new funds over the last month.
e-Therapeutics investors and it's fund raising
Fintan Walton:
Okay, well we will come on to that, because obviously all companies need money at some point, now just give us an idea of who were the original investors in e-Therapeutics were?
Daniel Elger:
So going right back to the beginning e-Therapeutics had some local seed money and it also had early backing from a hedge fund, it then did a number of small raises, listed on the AIM market in 2007 and raised a small amount of additional money in it's IPO. Really the big funding has taken off over the last couple of years. so in 2011 the company raised nearly 17 million on the AIM market with Invesco coming in as a major backer, and just in the last month we've completed a 40 million pound fund raising, with again Invesco as key investors and attracted some additional public market investors including Aviva who are now significant backers as well.
Fintan Walton:
Right, and those are not, you know they are not traditional VC type backers, why is it that e-Therapeutics can attract the interests of Invesco and Aviva?
Daniel Elger:
Well Invesco has had a history of backing a number of healthcare businesses and Neil Woodford, the Fund manager there, is known for his enthusiasm for the broader pharmaceutical sector. I think we have a particular story that chimed with these investors which is not just about the clinical stage drugs that we are taking forward and the possibility that those will secure good revenues in partnering deals and generate good returns over the short and medium-term, but also they are excited by this platform technology which really is a very distinctive and new approach to drug discovery that over the medium to longer-term could generate really significant value in this business through it's application to a number of disease settings.
Fintan Walton:
Right, I mean obviously it's quite a land mark, because obviously with the biotech sector, emerging pharma company sector to raise that level of money in today's climate has been quite an achievement, was being on AIM helped you to do that?
Daniel Elger:
Well I can only say yes in the sense that clearly the company is on AIM and in that context it's completed these two significant fund raisings, first the 17 million raised in '11, and then the 40 million raised that we've just completed, so for us that's worked well and I hope this is a signal that other companies with exciting biopharma businesses will be able to achieve similar results.
Fintan Walton:
I suppose the tempting question is that if you were a CFO of another biotech company would you recommend that they go on AIM first before trying to raise money?
Daniel Elger:
Well that's a good question, I think it's horses for courses, I mean it's not necessarily going to be ideal for everybody, it depends on the history of the company, how it's been backed, what kind of ongoing venture backing you have, what kind of exit you are anticipating, but certainly for us we've obviously found a constituency of supportive investors in this environment and so we are very pleased and we are obviously very grateful to the investors who just backed the business with funding that will take us right through, we expect to 2017 and to be able to achieve some really significant corporate milestones.
Fintan Walton:
Right, so that 40 million allows you to do what?
Daniel Elger:
The two main areas that that's going to be invested in are, on the one hand taking our promising cancer drug that I mentioned ETS2101 right through to the end of Phase II program at which point we would be expected to partner it, so that's a funding through to a potential licensing deal on that asset, and at the same time the funds are sufficient that we can continue to make really significant investment in getting the most out of this exciting new approach to drug discovery, network pharmacology the funds allow us to continue to operate our discovery platform coming up with new drugs and to take the most promising drugs coming out of that platform into early phase clinical development so that by the time we get the Phase II results on the cancer drug, we expect to have a number of drugs into various stages of development.
Fintan Walton:
Right, because often these days investors like to just focus on one or two products?
Daniel Elger:
Yes.
Fintan Walton:
Rather than saying yes you can spend some of your money on earlier stage products, so this is quite unique as well, isn't it?
Daniel Elger:
It is unusual perhaps in that respect, I mean we had an explicit proposition to investors that we were seeking backing for both of these areas but that also reflects the fact that we know that the investors who backed the business are enthusiastic about the discovery approach and the platform and it's longer-term potential and so that's a is an interest from the investors that's helped to support that approach.
e-Therapeutics focus on taking products forward
Fintan Walton:
Right, I suppose the other thing about been floated on the stock market under AIM in the UK is to maintain a momentum, because often there is a lot of biotech companies that got on AIM and lost that momentum as we all know, so how do you do that, obviously clinical development, taking your products forward, all the things you've said is there a temptation to be a bit bolder and braver and use the fact that you are a publically listed company to go out and do some acquisitions or do something that's different?
Daniel Elger:
Well I wouldn't rule out acquiring another business, but we'd only do that if it clearly fitted with our strategy and our network pharmacology approach. Our main focus is on really getting the most out of this exciting new discovery program and we are confident that our platform can generate a steady stream of new assets and give us plenty of choices in terms of taking the best of those into clinical development and then ultimately taking those drugs that do go into the clinic through to the licensing deals that would generate revenues back into the business.
Fintan Walton:
Daniel Elger, thank you very much indeed for coming on the show.
Daniel Elger:
Thank you.
Fintan Walton
Dr Fintan Walton is the Founder and CEO of PharmaVentures . After completing his doctoral research on the genetics of cell proliferation at the University of Michigan(US)and Trinity College (Dublin, Ireland), Dr Walton gained broad commercial experience in biotechnology in management positions at Bass and Celltech plc (1982-1992).
Daniel Elger
Chief Financial Officer
At the time of this PTV interview Daniel Elger serves as Chief Financial Officer at e-Therapeutics. Daniel Elger has 18 years' experience in healthcare businesses. He began his career in medical publishing. He then spent five years at pharmaceutical marketing consultancies Blackwell Healthcare and Avenue, becoming a Programme Director in 1999 and leading accounts for GSK, Janssen, Roche, Pfizer and Merck. In 2002 Daniel joined cancer drug developer Antisoma as Head of Corporate Communications, becoming Communications Director in 2005 and VP, Marketing & Communications in 2008. He served on the Senior Management Team and played significant roles in corporate strategy, fundraisings and the acquisition of two US biotech companies. Daniel has a BA in Physiological Sciences (Medicine) and a PhD in cancer cell biology, both from Oxford University.
PharmaVentures
PharmaVentures is a corporate finance and transactions advisory firm that has served hundreds of clients worldwide in relation to their strategic deal making in the pharmaceutical, life science and healthcare sectors. Our key offerings include: Transactions / deal negotiations; Product / technology valuations; Deal term advice; Due diligence & expert reports; Strategy formulation; Alliance management; and Expert opinion for litigation/arbitration cases. PharmaVentures provides the global expertise to ensure our clients generate the highest possible return on investment from all their deal making activities. We have experience of all therapeutic areas and can offer advice on both product and technology commercialization.
e-Therapeutics
e-Therapeutics is an AIM-listed biotechnology company with a proprietary platform in network pharmacology, an innovative new approach to drug discovery based on advances in network science and chemical biology. The Company's discovery and development activity is focused in cancer and disorders of the nervous system. e-Therapeutics is based at sites in Oxford and Newcastle, UK.