Oxford BioMedica: Survival of the ‘Cash-Rich'




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Video title: Oxford BioMedica: Survival of the ‘Cash-Rich'
Released on: November 11, 2008. © PharmaVentures Ltd
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Eighteen months in the life of a biotech company is a significant length of time. Nick Woolf takes this opportunity to bring you up-to-date with the changes in Oxford BioMedica since his last appearance on the show, giving insight into the Trovax® trial results and the effects of these results on its relationship with Sanofi-aventis. Looking to the future he tells of the restructuring the company has gone through in order to secure its financial and commercial position in these uncertain times and discusses the importance of their ‘cash-rich’ status.
Changes in Oxford BioMedica over the last 18 months
Fintan Walton:
Hello and welcome to PharmaVentures Business Review here in London. On this show I have Nick Woolf, who is Chief Business Officer at Oxford BioMedica in Oxford, UK. Welcome to the show.
Nick Woolf:
Thanks very much Fintan it's a pleasure to be here.
Fintan Walton:
Nick, you were on the show about 18 months ago when we talked about Oxford BioMedica. 18 months as everybody knows in biotech is reasonably long time a lots of things have changed could you describe where Oxford BioMedica is now in relation to it was 18 months ago number of things you moved on particularly your products?
Nick Woolf:
Absolutely I mean the company is in a different position today then it was 18 months ago. We have still have a very strong partnership with Sanofi-aventis [PharmaDeals ID = 33213] [PharmaDeals ID = 26864] around our lead program TroVax and mean time we have moved forward some of our other programs in particular our Parkinson's Drug ProSavin which is now in clinical development. And we've also looked at our strategy and our management to ensure that we are well positioned as we go forward now to really drive Oxford BioMedica as quickly as possible towards sustainable profitability as a highly valid biopharmaceutical company.
Trovax and future developments
Fintan Walton:
But you are in the course of 2008 TroVax has been in the news for number of reasons do you wanna give us a specific update on TroVax and how that product is gonna go forward into the future?
Nick Woolf:
Yes, so TroVax is our Phase III cancervaccine partnered with Sanofi-aventis. And we started the Phase III trial in renal cancer a couple of years ago and that trial had has a (DSMB) Data Safety Monitoring Board that conducts regular interim reviews and at it's latest interim review in July they concluded that although the trial should continue it was unlikely to reach it's primary end point of improved survival based on events and the recommendation was to discontinue vaccinations. And to that ends that trial while continuing we have had to put amendments through which we have now agreed with the FDA and it's also impacted our development path going forward with Sanofi-aventis.
Fintan Walton:
Right. But what are the options for that product going forward?
Nick Woolf:
Well the amendments that we put into the trial are such that we want to analyze whether optimal benefit is derives from a certain number of doses of TroVax whether it depends on the standard of care with which TroVax is administered or in prognostic factors whether we should be looking at patients with a poor prognosis or a better prognosis at baseline. And the outcomes of those amendments mean that although the trial and it's called the TRIST Phase III study will likely form part of a registration package. We will undoubtedly need to consider an additional confirmatory study to get the products marketing renal cancer.
Fintan Walton:
Right. And then obviously the relationship with Sanofi-aventis continues?
Nick Woolf:
Indeed, Sanofi has been a committed partner, we have continued our activities together they continue with us to evaluate the interim data that we were able to access in July and they have been supporting us through our regulatory interactions around the renal trial. And you know pending their agreement with the FDA to conduct further trials they are committed to do big Phase III trials in colorectal cancer and we, we'd like to think that those would start in the first part of 2009.
Fintan Walton:
Right. And for Sanofi-aventis that's a much more important therapeutic field?
Nick Woolf:
It's a bigger market in terms of patient numbers and in terms of Sanofi they have a long history in colorectal cancer with chemo therapies and that the outside of our collaboration colorectal cancer was that prime focus.
Product on Parkinson's
Fintan Walton:
You mentioned the other product is for Parkinson's could you give us an update on that particular product?
Nick Woolf:
Yes well ProSavin, so ProSavin for Parkinson's diseases uses the company's core Lentiviral-vector-technology called LentiVector this is a new generation gene delivery system which very precisely can target certain tissue types in particular cells with the CNS. And it is designed to restore dopamine production in patients with Parkinson's disease which is believe is what is required to improve outcome and we have moved that product into clinical trials and we are conducting a study in France at a centre of Neuroscience Excellence the Henri Mondor site in Paris. It's an 18 patient trial it includes a blinded aspect certainly some patients get a sham. And we started that trial at the beginning of the year and we were able to report in September some initial data.
Fintan Walton:
And what was that like?
Nick Woolf:
Encouraging. We have been able to this is the with the first dose the first stage of the study is a data escalation and with a relatively low data we believe and this is only three month data we've been able to show on the EPDRs measurement that's the you know find Parkinson's disease rating score, part 3 which is at the remote function and improvement in patients off state by ups 30% and another endpoint is to get it demonstrate that we can lower the patients current L-DOPA, L-DOPA 'equivalent' therapy and again we've been able to see that even at the three months stage.
Fintan Walton:
Okay.
Nick Woolf:
So we had a data and monitoring committee again on this study and they review that data recommended that we move to the higher dose level, there is only two doses in the study. And we've embarked or we started that in September as well.
Hostile take over attempt
Fintan Walton:
Okay. So on you go with your clinical trials, going back to the company the business itself you over the summary you also had an attempt for hostile takeover?
Nick Woolf:
Indeed, we it came somewhat out of the blue they did come and visit us, but we didn't see there was any fit, the company was called GeneThera listed on the bulletin board in the US. And I mean their market capitalization just to put in perspective was 400, not million but thousands dollars.
Fintan Walton:
Right.
Nick Woolf:
So as a size the company was not in a position to make a bid for Oxford BioMedica, we didn't see any technology fit, no management fit and hence we were we weren't - we didn't think it was a viable offer.
Fintan Walton:
Right. And unnecessary distraction?
Nick Woolf:
It was a distraction.
Fintan Walton:
Right.
Nick Woolf:
But I mean interestingly I mean it did prompt to start of other discussions which are still ongoing.
Fintan Walton:
With them?
Nick Woolf:
Not with them, with other parties.
Fintan Walton:
Right.
Nick Woolf:
And so to an extent that it has helped us more forward in some of our business development activities and our strategic plan to so look externally at opportunities as well, it was a useful catalyst.
Announcement of new CEO and future direction
Fintan Walton:
Sure. So the other events that happened over this summer is Alan Kingsman, Professor Alan Kingsman who is the founder of the company is now moved up to Chairman and I believe today which is the 13th of October, 2008 you've announced a new CEO?
Nick Woolf:
True, that's right Alan Kingsman, Professor Alan Kingsman was a co-founder of the company as you mentioned, he is been CEO since our inception in 1995. And in his role as Chairman obviously he is still integrally involved with the company. But as we look forward to the opportunities for Oxford BioMedica over the next few years particularly we recognize the need to have commercial and business expertise within the Senior Management and John Dawson who joined the company in August was appointed as a permanent Chief Executive today. And John brings with him his experience in building specialty pharmaceutical companies. He was previously with Cephalon in the European operations and he helped to build that company into one that today in terms of the European business now it generates around $350 million in sales.
Fintan Walton:
So then clearly that could be a signal that Oxford BioMedica is going to go out in a new direction would that be a reasonable interpretation?
Nick Woolf:
It's fair to say that well we recognize our heritage in gene therapy and obviously we still believe in our own programs and in gene therapy and we are still keen to ensure that you know Oxford BioMedica remains leading if not the leading player in that field. We are looking now at other areas that are not in gene therapy but where we can see obvious overlap and fit whether that be on a therapeutic basis or in terms of infrastructure fit so that we can help to diversify the company really with the aim to accelerate profitability for Oxford BioMedica.
Fintan Walton:
So that will require further strategic alliances to say the least and possibly joint ventures, acquisitions?
Nick Woolf:
Yes.
Fintan Walton:
Bigger things to play?
Nick Woolf:
Yes it's multi stranded, we are also expanding our business development activities in terms of partnering some of our own products, but looking externally I think it's a point of your question, yes it's looking at merger opportunities, acquisition opportunities, in licensing opportunities and really you know with a fairly broad remit if we look at our current programs particularly the lead programs the TroVax and ProSavin we could envisage that they may reach the market from sort of 2012 onwards, 2012 in the case of ProSavin probably 13/14 for TroVax, but we would like to reach sustainability sooner than that, we don't want to have to come back to the capital markets as often as we did in the past. And we are looking at late stage opportunities even revenue generated opportunities.
Fintan Walton:
Right. I mean obviously in this climate in current financial market is pretty much of a turmoil going on out there, so presumably you don't want to do that?
Nick Woolf:
Yeah that's not...
Fintan Walton:
It's very difficult to do that anyway?
Nick Woolf:
Yeah, it's not.
Fintan Walton:
So the idea then is to make the company a cash flow positive company?
Nick Woolf:
Absolutely, I mean that is the aim, but you know still with lot's of growth it's not just to buy sort of a tail end line of product that may be coming off patent to say it's really to build a sustainable growth story obviously built around, around revenue. And we are fortunate in having two-years of cash within the company today and so that I mean it gives us a reasonable runway you know to build the business. But at the same time you know we recognize that's relatively short in drug development terms, so we are looking absolutely new drivers of growth that can bring in that may bring in cash.
Fintan Walton:
When you talk about two-years of cash burn that's on the assumption that you are using the same amount of money for the current clinical programs that you are committed to?
Nick Woolf:
Yes. So we have reported our - reported our half year results over the summer and our position then was a net cash, net cash balance of 27 million pounds and that is sufficient to fund our current operations through into the second half of 2010. And we, when we looking externally at strategic transactions or other opportunities it's not to spend that cash it really is to, to bring in you know new cash and new opportunities that consult funding.
Fintan Walton:
So is that mean that you are diverting your funds away from earlier stage research, so you are moving more towards a development company will that be a fair, fair comment?
Nick Woolf:
Yes, I would be migrating that way for some years just as the company has matured, but we did go through a restructuring again over the summer which eased our cash burn. And to the extent that we focused our efforts is on our own late stage programs and less emphasis now on the preclinical and on research areas.
Oxford BioMedica's business model.
Fintan Walton:
Right. So looking at the current financial markets like you are somebody who has worked in the city here in London with a number of banks and so forth, what's your view generally in terms of how biotech companies not just like Oxford BioMedica but looking at the broader range of companies out there how they are going to survive the next year or two-years do they have to or adopt the model of Oxford BioMedica or are there other options?
Nick Woolf:
I think consolidation is something that institutions but and even our own we have some very major institutions with significant shareholdings in Oxford BioMedica who are very comfortable with our strategy of helping to drive that consolidation. And we more say them some other biotech's have that luxury of not needing to return to the capital markets for additional cash based on our current operations.
Fintan Walton:
So cash in the bank is put's you in a much more powerful position?
Nick Woolf:
I think cash is king. I mean with these you know as you mentioned I mean these are peculiar times it is not clear to anyone how long this period my last in terms of the uncertainty in the difficult financial climate and there is no guarantee we are going to go back to the, to some other the glory days of the biotech sectors had before and in terms of being able to you know return to the capital markets for more funding. So yes I think the sector as a whole has to look at how it drives you know some of that you know some leading technologies and in many - for many companies early stage research and towards commercialization they haven't to rely on financial investors.
Fintan Walton:
Yeah.
Nick Woolf:
I would like to think that the pharmaceutical industry will continue to play a big part and but to the partnering and in M&A for that matter.
Fintan Walton:
Right.
Nick Woolf:
We need to make sure that you know products are developed and commercialized.
Fintan Walton:
I suppose one of things that we all know about the pharmaceutical industry is in developing products is a long game so events that happen over a couple of years are just minor events compared to the big issues that biotech and pharmaceutical companies have to face over 8, 10-years?
Nick Woolf:
Indeed, I mean I would agree but to the extent that lot of companies particularly in UK and Europe are you know tended to at least in the past sort of drift fed money from financial institutions in order to get to the next milestone. And if that - the availability of that equity financing is not there and certainly it hasn't been in the recent weeks or months you know there people need to look at that model and whether it's through pharma or through other means of financing, you know there has to be a recognition that you know companies need funds to progress. And so we would have to play a part in that where as Oxford BioMedica obviously you know we are relatively mature as a company compared to many, we know we are public company, we have a very strong shareholder base. And lot of expertise in-house, so you know we are not looking to take on early stage assets but we do hope that we can may drive the industry and become really you know a leader certainly in the UK sector in the biopharmaceutical industry.
Fintan Walton:
Well Nick, we'll be watching Oxford BioMedica very carefully and we wish you all the best in the future. Thank you very much for coming on the show again.
Nick Woolf:
Thank you.
Nick Woolf
Chief Executive Officer
Nick Woolf, Chief Business Officer of Oxford BioMedica, was appointed to the company's board in March 2005. He has extensive experience in investment banking and equity research in the biotechnology and pharmaceutical sectors and has been involved in all aspects of company financing, ranging from initial public offerings to major corporate deals. Nick joined Oxford BioMedica in 2002 from ABN AMRO, where he was a Director and Head of European Biotechnology Research. Prior to ABN AMRO, he was a Vice President and Senior European Biotechnology Analyst at Robertson Stephens, and was previously at both Nomura and SBC Warburg. Nick is a qualified FCCA accountant and holds an MA in Chemistry from the University of Oxford
Oxford BioMedica
Oxford BioMedica, a publically quoted biopharmaceutical company that specializes in the development and commercialization of innovative gene-based medicines, was founded in 1995 as a spin out from Oxford University. Oxford BioMedica has a platform of gene delivery technologies, which are predominately based on highly engineered viral systems. They several products which use genes as the mediators of either a therapeutic effect or an immune response. The company's development pipeline is comprised of five gene-based product candidates. Of these products, TroVax, a therapeuticcancervaccine for multiple solid cancers, is being developed in collaboration with Sanofi-aventis and is currently in Phase III development for renal cancer. ProSavin is a gene-based treatment for Parkinson's disease entered a Phase I/II trial of ProSavin in December 2007. In addition to the TroVax collaboration with Sanofi-aventis, Oxford BioMedica has corporate collaborations with ARIUS Research, Intervet International, MolMed, Sigma-Aldrich, Viragen, VIRxSYS and Wyeth. In addition, the company has technology license agreements with Biogen Idec, GlaxoSmithKline, Merck & Co. and Pfizer.