Domainex Ltd: Combinatorial Domain Hunting and the Domainex Business Model




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Video title: Domainex Ltd: Combinatorial Domain Hunting and the Domainex Business Model
Released on: June 16, 2010. © PharmaVentures Ltd
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  • Summary
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In this episode of PharmaTelevision News Review, Fintan Walton talks with Dr Eddy Littler, CEO at Domainex Ltd. Filmed at BioTrinity 2010 in Newbury, UK, they discuss:

• Domainex's leading technologies

• How CDH technology works

• What sort of companies use Domainex technologies

• The selection process of risk projects

• Partnership and collaboration model

• Advantages of Domainex's business model

• Recent investment by Takeda Research Investment

• Future goals and terms of measuring success
Technologies of Domainex
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here in Newbury, Berkshire at BioTrinity. On this show I have Eddy Littler, who is CEO of Domainex a company based here in the UK, welcome to the show.
Eddy Littler:
Thank you.
Fintan Walton:
Eddy Littler, your company Domainex is a company that specializes in some very specific technologies that are relevant to the pharmaceutical industry so the first thing I'd like to ask you is little bit about your company, what does your company actually do?
Eddy Littler:
Yes, we approach what's called a hybrid business model, so they have two parts to Domainex's business. The first part of services and they are based upon that unique technologies that we have it in the company and in the second part of the business is our own internal drug discovery pipeline again based on these technologies.
Fintan Walton:
So what is Domainex? What is your technology? What is your competence that makes you unique?
Eddy Littler:
Yes, so one of our main technology stems from worked on by one of our founders Laurence Pearl and it basically allows gene targets which are challenging but 10% of the targets that we know in the pharmaceutical industry are technically challenging big difficult to express, so we can't get good quality protein for assays or for X-ray crystallography and this technology unlocks those targets. We operated this now for about five-years mostly as a service to large pharmaceutical companies and it's worked extremely effectively forward, we are now operating this for ourselves on our own targets as well.
How does CDH technology work?
Fintan Walton:
Right, so just to get this clear when you say you've got the technology to presumably express the protein what is about your technology that allows you to do that? What is the disruptive presumably is the disruptive technology that allows it breakthrough what's that breakthrough, how does that work?
Eddy Littler:
So the technology is called Combinatorial-Domain-Hunting and what it basically says is that if you can't express the whole protein there will be a region a domain of the protein that basically should be able to be expressed and make good quality protein. The difficulty is that you can't predict these domains by bioinformatics there are no clues hidden in the protein sequence, so what the technology does it basically says if you can't predict where to start and finish a particular gene or particular domain make them all not with (indiscernable) those mix all the potential starts and finishes and then basically you make huge libraries of these constructs and then you fish among those constructs and find then one or two that behave really well. So what the power comes from is extremely large librariesgiving all possible combinations and the ability to filter those librariesand find that the that needles in a haystack there real gems that work well.
Fintan Walton:
And so you are looking for in the end functional domain which you define functionally by their specificity to a particular receptor or is it how would you define functionality?
Eddy Littler:
So domain we define a domain as a region of protein that's able to fold independently the rest of the sequence of the protein and how some or all of the properties of proteins. So for example if it's a kinase it may be the kinase binding size and it may wish you have they'll fold or bind ligand and it may have kinase activity and that particular construct be very useful for deriving an extra crystal structure or for developing an assay of some source.
Fintan Walton:
Right so once you've found a domain how do you go forward, do you have to then build up the rest of the protein to see end up with the complete enzyme if it's an enzyme or receptor if it's a receptor?
Eddy Littler:
It can be used that way commonly however once you've got the actual domain that you are interest in you can actually generate the structure of that domain and that can be used for designing inhibitors or can be used for developing assays but as you say in some cases you can actually build a whole protein from a series of domains and that was our founders did that originally to generate the structure of a protein called HSB90 first high resolution structure was derived using a sort of approach.
What sort of companies use their technologies?
Fintan Walton:
Right, now sticking with the part of the business model where you service the industry on a contract research basis you've got that technology and what sort of companies are using that? How are you winning that business?
Eddy Littler:
So the sort of companies that use the technology are large pharmaceutical companies in which they have a large pipeline of targets and there are one or two targets that basically they are actually committed to deliver. And as I said before we talk to these organizations they would say around about 10% of the targets are problematic to the point where they behave poorly or just don't behave at all there and so that's our typical client base. There is another area which is probably a biotech which operates in a niche where it for example may be dealing repair and in this case they are committed to deliver those targets, so that's our typical client base for this biology technology which is very unique. We do have another technology which is called LeadBuilder and that ironically is almost the other side of the coin that's a very cost effective way to find very developable hits and that is particularly targeted at small biotech companies, university start ups and spin outs, so two very different client groups for two different technologies.
Fintan Walton:
So why would LeadBuilder not be of interest to a pharmaceutical company?
Eddy Littler:
Generally speaking, well I think it should be that I think they should be operating in a cost effective way now indeed. Generally speaking large pharmaceutical companies have invested in many of the technologies to try and find hits. So 20-years ago most companies got involved in high-throughput-screening and that's where they find the hit matter from. In this case basically some very cost effective way of doing this.
The selection process of risk projects
Fintan Walton:
Right, now going back to your business model because obviously what we're interested in is Domainex as a business and how you are going to be successful in the future so one side you've just described how you help assist companies to contract research, the other bit is the gamble, is the risk that you are going to take on yourselves so how do you select those risk projects, those projects that you gonna take forward and is it just purely on your own or do you look for collaboration anyway right from the outset?
Eddy Littler:
It's a very good question. The pipeline we select is a fairly unique pipeline and we came as if from several directions first of all we set what are the targets that are known to the pharmaceutical industry that are known to have a series of technical issues and problems that we believe that our core technology will solve that was the first way we approach the targets. The next we approach a target is a fact that we actually are very experienced drug hunters ourselves many of the people in Domainex have worked for large pharmaceutical companies and biotech companies and developed compounds currently in the clinic and so we look for attractability and when we did that we ended up with a set of targets which were largely in oncology and we then focused on those targets.
Partnership and collaboration model
Fintan Walton:
So with these sort of projects are you likely still to partner with those? Are you gonna still look invite individual entities, companies, organizations come in and share the risk with you?
Eddy Littler:
Yes we are looking for partners I think in two different ways. One is a classical out licensing approach so we will take these technically difficult projects to proof of concept stage and then we look for partners to help take those compounds through to the clinic.
Fintan Walton:
When you say proof of concept, proof of concept in at what stage?
Eddy Littler:
In disease models which want drug candidates before the clinic but also it's a different type of relationship that we've built over a period of time and that's basically to partner with some specialist university groups to provide the sort of unique biology we need to progress these targets through. So on our main project which is a kinase called IKK-epsilon and this is a target which has clear validation for breast cancer we are collaborating with Breakthrough Breast Cancer at the Institute of Cancer Research [PharmaDeals ID = 35827] [PharmaDeals ID = 32899].
Fintan Walton:
And that was just announced last week?
Eddy Littler:
Yes its one part of the announcement and this is to enable them to provide the great expertise in the biology of breast cancer to support our chemistry if you like. The announcement last week for (indiscernable) round and that is that in collaboration with the same group they have a target of their own and together we supported them to basically put an application into the Wellcome Trust Seeding Drug Discovery initiative an excellent fund for translational medicine and that was successful and now we are working to support them providing the hit finding and lead optimization services for them to take that project forward. So we've actually got a very close relationship to the Institute of Cancer Research in several different ways.
Fintan Walton:
Okay. And so that's in a sense and really largely a collaborative model is it little more in the collaborative side?
Eddy Littler:
It is, yes.
Advantages of Domainex's business model
Fintan Walton:
So going back to the business model and you know there are number of companies like yourselves now in this hybrid business model, obviously you think it works, some cynics would say you have to be really focused you are either contract research organization or you are pure research base biotech company taking risk, which one is right?
Eddy Littler:
I don't think is a question of right and wrong. I think you have to understand your model and make sure that model works for you. In our case I think the advantages of our model is a fact that it's very cost effective. It's not a new model I think many companies have been operating this for many years sometimes we call it collaborations, sometimes we call it technology access fees but the concept of basically providing your unique services to other companies to bring in revenue I think has an attraction you know reduces the risk, the financial risk in your organization and make sure your own drug discovery are more cost effective. I think the other advantage is that it allows you to basically form relationships to display your technologies to a big audience so they are very familiar become very familiar with this and it allows basically sort of showcase it and form relationships and that's equally valuable.
Recent investment by Takeda Research Investment
Fintan Walton:
Right, now the other recent announcement is the equity investment by Takeda Research Investment (TRI) [PharmaDeals ID = 36128] how do that come about and why should a company like there's be interested in you?
Eddy Littler:
Actually it came about where in a meeting we had with Takeda Research Investment (TRI) at this meeting last year a strange coincidence.
Fintan Walton:
With Graeme Martin?
Eddy Littler:
Yes Graeme Martin of course. And basically Graeme, I think it's fair to say was familiar with Domainex from a over a period of years and has watched the technology that we are we've been operating develop over a period of time. And I think they felt at the last meeting the technology matured enough for them to basically want to basically play a bigger role in the company. So as you've said they've made a corporate investment into Domainex and at the same time some of our existing investors. So our major investors are groups such as Longbow and The Capital FundYFM also basically made an additional investment. And I think for Takeda Research Investment this is a way of basically gaining access to technology to get very close to company and basically to see how it develops matures.
Fintan Walton:
Are they taking options? Have they got special areas that they've got particular access to or are they just sitting there as investors watching the science develop?
Eddy Littler:
Yes I think both of things, they basically we are working with them on the number of targets using this CDH-technology to try and clone express them and that work is ongoing but also I think there is a long-term strategic interest to watch the company develop and to see how these the technology advances and to see how these targets we are bringing forward come forward over the next few years.
Future goals and terms of measuring success
Fintan Walton:
So now we look into the future Eddy and what can you take, how can you take a company like yours forward obviously a lot more collaborations, lot more research to happen but when would you measure, how would you measure your success in the next four or five-years?
Eddy Littler:
Yes. So I think the first answer to that is you need to stop by looking to service business enough now is flourishing. We really do have a very solid platform for the services they are delivering what they have to deliver which is covering our operating cost so that's the first big tick in the box. The next tick is obviously where you add value to the company and this is where most of our investors of course are investing for the future and that pipeline then the lead project which I've talked of before IKK-epsilon is moving forward very well and we would expect to have some serious discussions for licensing in about a year's time.
Fintan Walton:
Right, so you expect proof of concept by next year?
Eddy Littler:
That's right, yes it should be in that stage before the end of the year and we are already talking to a number of large pharmaceutical companies as potential partners to basically make sure that they are aware of what we are doing and how things are coming along. So I think that's another measurement to success, the first project needs to basically be out licensed in the next 12 months. And I think finally we obviously have a portfolio of some very unique targets coming forward and they need to mature over the next two-years. So I think it's a complex business model and therefore there is a number of different outputs that need to be measured.
Fintan Walton:
Okay. Eddy Littler, thank you very much indeed for coming on the show.
Eddy Littler:
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).
Eddy Littler
CEO
Dr. Eddy Littler began his research career at the University of Leeds working with Ken Powell. After postdoctoral research at McMaster University in Canada and the Paterson Institute for Cancer Research in Manchester he joined the Wellcome Research Laboratories as Head of Herpes Virus Research. At Wellcome he became Head of the Gene Targets Group and following the acquisition of Wellcome by Glaxo he became Head of Antiviral Research at GlaxoWellcome. Eddy Littler left GSK in 2000 to join Medivir as Senior Director of Lead Discovery and Head of their UK operations. Whilst at Medivir he played a significant role in several deals, including the out licensing of the HCV protease inhibitor programme to Tibotec. The total value of deals converted at Medivir was $360M. Eddy Littler became the Chief Executive Officer of Domainex in May 2008. Eddy Littler is a member of the SAB of Tibotec and a member of the Infection and Immunity Board and the Translational Research Group at the MRC.
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 commercialisation.
Domainex Ltd
Domainex Ltd is a contract research company that was established in 2001 and operates from Cambridge UK. In May 2007 Domainex merged with NCE Discovery to form a new integrated company with capabilities in biology and chemistry. Our service division offers technologies designed to clone and express challenging genes to give high-quality recombinant protein displaying functional domains of the target. We also provide computational and medicinal chemistry for the design and synthesis of candidate drugs aimed at our customers' target protein . Our drug discovery division seeks to exploit these technologies and expertise against a small portfolio of our own projects. Our internal programmes are exclusively focused on nucleotide triphosphate binding domains (NTP domains) which are found in several important therapeutic targets