Peter York and Paul Thorning of CrystecPharma explain why they have chosen to base their operations in China




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Video title: Peter York and Paul Thorning of CrystecPharma explain why they have chosen to base their operations in China
Released on: February 29, 2012. © PharmaTelevsion Ltd
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In this episode of PharmaTelevision News Review, Fintan Walton talks to Peter York & Paul Thorning from CrystecPharma.
Super Critical Fluid (SCF) technology: Importance and potential applications in Pharmaceutical industry
Fintan Walton:
Hello and welcome to PharmaTelevision News Review here in Oxford in the UK. On this show I have Professor Peter York, who is Emeritus Professor of Physical Pharmaceutics at Bradford University and Paul Thorning, who is the CEO of the company we are gonna talk about which is called Crystec and of course Peter you are also the Chairman and Chief Scientific Officer of Crystec. Now Peter you have a history of innovation and founding companies and so forth and you are involved in yet another one, the other theme is the area of super-critical fluid (SCF) Technology, so before we start to talk about Crystec itself specifically could you just give us, give our audience a taste of why SCF technology is so important and its potential application to the pharmaceutical industry?
Peter York:
Yes I am pleased too, in fact the initial phase of my interest in super-critical fluids came as a result of chatting with colleagues in the pharmaceutical industry who bemoaning the use of the technologies that were available for producing fine particles those increasing interest in the pharmaceutical industrial in fine particles lot to overcome some of the current challenges that exist with both small molecules and macromolecules in moving them efficiently into efficacious medicine, current techniques for making fine particles were limited they led to some distress, difficulty, and secondary processing and so on, so I went away thinking about an alternative way of making particles and into the literature talking around came up with the experience of some success quite early on using super-critical fluids this process lends itself to great versatility and variety and the ability to design particles drug particles and in many cases overcome some of the challenges the industry were facing with the current technologies for preparing small particles of these API's.
Fintan Walton:
Okay, so it overcomes a number of problems that the industry is presented with obviously particle size is one, the other is composition, I think there is more?
Peter York:
Well there is a whole series of wishes behind the design of these particles not only in terms of the processing and formulation but also moving to regulatory issues and manufacturing issues, stability issues and it's the features that are desirable in the design of that particle it might be size, it might be shape, may be composition, it may be purity, it may be residual solvent levels, it may be handling problems downstream, it may be changing the release profile to modulate the release and absorption of drugs, these are features that are able to be engineered into the design of particles because of this rather wonderful approach that's based on super-critical fluid technologies.
CrystecPharma : Origin and operations in China
Fintan Walton:
Right, and the company that you're founded before is company called Bradford Particle Design and that company was ultimately bought by US company called Nektar, so you've had that real experience in growing a company and actually going on to sell it, so may be that brings me on to you Paul, because you obviously joined up with Peter but could you tell us the story about how you got involved with Crystec and also I suppose how you have actually ended up as a British company with operations in China?
Paul Thorning:
Right, the sale of Bradford Particle Design was a great success of $200 million sale to ultimately to Nektar and Nektar at that time choose to keep the technology really for its own product development activities, they faced some difficult choices they had acquired three powerful technologies one of which was inhaled insulin and when they started to get some good clinical data for inhaled insulin they choose to de-prioritize other activities including the recently acquired SCF, so I think Peter and the team where in a difficult situation because clearly Nektar weren't taking it forward and the technology had application across the industry but had been locked into Nektar through the sale of BPD. So when the Nektar SCF super-critical fluids site was closed down then Peter and his team tried to find various ways of taking it forward and then my own institute became involved the Institute of Pharmaceutical Innovation looking at novel drug delivery technologies and we tried to find different investors, different approaches we were talking to US company for a while. Peter and I happened to go on a trip together in China and we were sort of licking our wounds really trying to work out, why had this not yet been acquired in the right way and taken forward in the right way and a child's conversation let us to realize that actually we could use Chinese engineering and our own joint investment resources to relaunch the company because actually the cost space in China was a lot lower and the quality of engineering was just as good as anywhere else in the world, the Chinese of course have outstanding SCF technology partly because they are good at extracting products the natural products from using SCF. So we realized then that actually we could re-form the company with joint investment and of course I was the, Peter was very successful I was the limiting factor in that investment, but we came together we used a Chinese space in the first place, the Chinese operations has since grown but we've also since been able to redevelop the Bradford operation and we have now two sites.
Business model
Fintan Walton:
Very good, so that brings us on to the business model because obviously you've adopted the technology that you originally were involved in Peter, so how would you now basically reposition your business so that you could now exploit, continuously exploit the SCF technology within the pharmaceutical industry?
Paul Thorning:
Well BPD in itself was a great success, I think the one frustration that Peter and the team had is this technology was limited to Nektar I think that the one thing we are not going to do is the limit in this technology again, so we want to see this technology used broadly to improve the performance of pharmaceutical products and to prove the bioavailability of small molecules to approve the stability of large molecules, I also some exciting areas such as natural products medicines this technology has great potential and that really means that we need to operate quite a mixed business model and one will be in working with the industry to help them improve their products and ultimately to use this technology in their own settings. We will engage with collaborative product development where actually bring our skills and together with clients skills and working in collaboration to develop towards their own products and needless to say from the experience that Peter the scientific team have they were also engaged in developing our own products these are essentially repurposed, reformulated super generic opportunities that we have in-house.
Commercial success with SCF technology
Fintan Walton:
Okay, very good. I suppose Peter, we've talked about the experience that you've had and what examples are there that there has actually been a commercial success with SCF technology?
Peter York:
Well I think the evidence is based on considerable experimental data both in laboratory in animals and also in clinical environment perhaps the most advanced product that's coming through based on SCF is a product for migraine and it's the Levadex product from the MAP company in California and this is now have finished all Phase III clinical studies and it's in NDA application pending, well the application is in and the result is pending for MAP. This product is an alternative route of delivery instead of an oral product it's now metered-dose inhaler going into the lungs and that requires smart particles and the smartest available were those that were made by SCF the company tried other technologies to reach the specification characteristics that we required and SCF was the only technology that would satisfy those very strict and very stringent characteristics both in terms of physical properties, chemical properties and obviously absorption. So they have a very impressing product that showing terrific speed of onset when the spray is made into the patients lungs as fast almost as an intravenous injection and the clinical data is outstanding, at the same time we needed the technology for them that they could scale, they could run at GMP and that would be approvable by the regulatory authorities and so the FDA have been over the plan they haven't found any challenges with the process so the tech transfer has been achieved, the regulatory challenges involving the Phase both in terms of the product and the API that goes into the product. Other clinical evidence suggested we can overcome some of the current challenges faced by the pharmaceutical industry that includes improving solubility, stabilized material modulating released profiles of drugs and also thinking of alternative routes of delivery for established molecules to improve an efficacy of bioavailability, in terms of macromolecules we also have evidence that the process is relatively benign the conditions are not extreme, it sounds very extreme super-critical fluids but actually it's relatively benign and gentle process so many biological can get through with full activity and searching for room temperature stability of such materials would be an enormous benefit in that kind of space for biotech products.
Fintan Walton:
Right, I suppose the thing here is that there is it's been it is the technology that's been around for many years in that respect, so most scientists are aware of it to some extent, but I suppose the key question is how often do they get access to that type of technology do they does the pharmaceutical company have an SCF technology embedded in its own as part of its portfolio of technologies that should be applying and I assume that the company some companies have got we know that some companies already got some of that technology but it's not a normal practice?
Peter York:
No it's not normal because it's still seen on the periphery and that I suspect is due to the fact that they needed an the evidence of a registered product, but it passed the examination of the regulatory authorities that it had shown on scale, that had shown the ability to produce material at the manufacturing level that's going to be required to launch products and it can be done at modern scale and full GMP operations. So I think the if you feel there imagine there was a risk associated with other companies take it on board I think the evidence from the Levadexmigraine products takes and derisks many of the issues that people would have been mentioning about the background and why they are not setting full steam ahead in their own companies using SCF.
Fintan Walton:
Right, so Paul with Crystec you have that ability to scale?
Paul Thorning:
Yes.
Fintan Walton:
And what about cost, because obviously that's always going to be in somebody's back, somebody's mind?
Paul Thorning:
I mean cost is a good question I think the one of the issues that the industry faces is it has been using a similar technology platform for over a 100-years so a lot of pharmaceutical partnered engineering that based around micronisation. If you look at the steps that are involved from crystallization all the way through to our final micronized particles it's may be a 12 or 13 step process, what we can do with SCF is engineer particles in a single step so intrinsically SCF is going to be a more cost effective process, the difficulty the industry will face of course is if it has existing assets existing manufacturing assets they want to use them and SCF would be an additional cost. So if you are building a plant from scratch SCF is going to be much more cost effective and if you already have assets you want to use then SCF is a another investment, but there are other benefits to SCF and SCF you know is going to be you doing it above 90%, 95, 96% so product recovery is very, very high. It's an efficient process, it's a low energy process it's also a process that where you can recover such completely environmentally, friendly. So I think increasingly as people become confident in the technology we are going to see new investments in SCF, and ultimately I think given the quality of product generated using SCF we are going to see more and more people moving to it, more and more regulatory pressure perhaps to start using SCF material and hopefully now it will see the cost benefits for companies follow then as well.
Opportunities and funding environment in Chinese pharma industry
Fintan Walton:
And just continuing with Crystec and then what you are doing, I mean you've mentioned the business model and how you will go forward, obviously you are based in China all your at least some of your operations you are obviously based here in the UK as well in terms of the types of companies that you are approaching and ultimately looking at this I mean obviously most pharmaceutical companies who may have issues you presumably in discussions with but does that also extend into companies based in China?
Paul Thorning:
Absolutely, I mean we would tend to have customers in three different camps really, so large pharmaceutical companies will use us partly because of our indebt understanding of the solid state and how you can manipulate the solid state using SCF and they may not actually plan to use SCF but they still want to use us to understand the issues of probably more fitting in the stability and choice of appropriate polymerizing and so forth, of course some have their own product development challenges and work with us in that sense. The small company community often one of the big problems is that a company will have a very exciting molecule but they cannot address the fundamental challenge and rather than having to try out many different formulation solutions they can come to us and we have a pretty high success rate, and then you correctly mentioned China there are a number of specific opportunities in China, one is it's an industry that's moving from API to generic to branded and super generic and clearly SCF is great technology for improving solubility, reducing dose and so we have a number of projects underway there, it also has some particular applications in natural products medicine again China has a very strong natural products industry. The funding environment in China is also a particularly exciting us for a start-up company like us, because you see big investments in assets and a real appetite to take risks and to try pioneering technologies and the Chinese government willing to put money into developing new assets and new approaches so we could work in partnership with Chinese companies at the same time use Chinese government money to really give this technology a head start.
Fintan Walton:
It's always that comes back to your underlying part of your business model because obviously you are privately held company at this stage you haven't got any private equity coming in or VC equity, so your position in China gives you several advantages, one of them of course is the funding from the Chinese government from various sources?
Paul Thorning:
Absolutely right, yes the cost space is manageable although it's you know I wouldn't recommend China purely on cost alone I think there are some outstanding science and some outstanding ambition and level of investment in China which should be attractive for any company, but yes you know China is a great opportunity for us as a company.
Future vision and business plans
Fintan Walton:
And Peter as an entrepreneur who has gone through this before what do you going to do different from that you did last time is there or what you gonna try and avoid next time?
Peter York:
Okay, well I think we've brought a lot of new thinking not only into the business model, but I think we are bringing new thinking into the offering from SCF, I think if you like history with our preparing ground and our platform to start we are fledged now the wings are up and flying and the new thinking, new ideas we have we are linking it more to searching for subtle but important ideas in unmet clinical need and where the particular benefit of SCF technology again offer a big leg up for patients and the benefit to patients in terms of perhaps speed of onset of therapy where other routes and other technologies are not able to offer the same advantages as SCF. I think there is a whole, well I think we are only at the beginning may be the other, the earlier phase was birth and this is the next phase, I think the platform is growing all the time we are moving now to notions about perhaps it's called personal medicinal or smaller scale manufacturing with tuning for different genomic kind of assemblies of you and me, so I think the SCF has subtleties there that can lend itself to dealing with varying doses or subtleties in changing chemical the chemical composition and so on.
Fintan Walton:
In combination products?
Peter York:
In combination products, so we have another life to live that it's going to be very, very fruitful I am certain.
Fintan Walton:
Right, and Paul from a business perspective your vision? Where do you see the company in the next 5 to 10-years?
Paul Thorning:
I would hope it is it's still going as Crystec in a way I think what one I think we are not going to try and do is to sell the company lock, stock, and barrel to a single acquirer and see this technology locked in again, I really want to see this technology fulfill its potential in the industry. So I would imagine in five years time obviously I would hope for a much bigger company, I would hope for a global company that's doing continue to do well in China but elsewhere in the world. I would hope that we are working with large pharma and we are seeing more and more successful products launched using this technology, but I would also hope that we are key to enabling some of these smaller companies to actual make it in the way that BPD once did and hopefully Crystec grow and others. I also hope to see a lot of use for this technology in biotech, I want to see room temperature, stable biologics I spent a lot of time as Peter has done working in Africa dealing with the problems of cold chain and you know administering in drugs that were completely ineffective, we are working on an improved anti-malarial at the moment. So there is some really exciting challenges as well as not just about being successful as a company it's also about seeing this technology solve some real clinical problems that other technologies can't solve.
Fintan Walton:
Professor Peter York, and Paul Thorning thank you very much indeed for coming on the show.
Peter York:
Thank you.
Paul Thorning:
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).
Peter York
Chairman
At the time of this PTV interview, Professor Peter York is Chairman and a co-founder of CrystecPharma and is also Chief Scientist with responsibility for guiding the overall science and innovation strategy of the company. He is an Emeritus Professor of Physical Pharmaceutics and a world leading expert in pharmaceutical materials science. He has published over 300 scientific articles, holds numerous patents, and has received several research awards. He was the founder of Bradford Particle Design Ltd , a spinout venture from the University of Bradford , based on research and patents in particle formation by supercritical fluids, which was acquired for $200m by Inhale Therapeutics in 2001. He holds Fellowships of the Royal Pharmaceutical Society of Great Britain, the Royal Society of Chemistry, and the American Association of Pharmaceutical Scientists. He sits on MHRA and EMEA drug review panels and is a member of British Pharmacopoeia Commission. He is an Honorary Visiting Professor of the Shanghai Institute of Materia Medica, Chinese Academy of Science.
Paul Thorning
CEO
Paul Thorning is a co-founder of CrystecPharma and is Chief Executive Officer with overall strategic management responsibility for the company. He has over 20 years experience in the chemical and pharmaceutical industries in manufacturing, research, marketing, consultancy and senior executive roles. In his role as Director of the Institute of Pharmaceutical Innovation at the Bradford University, he has been actively involved in innovation in pharmaceutical sciences including the establishment of 3 innovation-based companies over the past 7 years. Away from the pharmaceutical industry, Paul spent three years in Tanzania, Africa, where he was responsible for a team running hospitals, health programmes and community services for 140,000 Congolese refugees. Paul is on the board of two other healthcare-related companies, is a Non-Executive Director of Medilink Yorkshire, and a member of the UK-China Joint Economic Trade Commission Healthcare Working Group. Paul speaks English, French, Italian and Swahili (and very basic Mandarin), holds an MBA and professional membership of the Institute of Marketing, and is a Fellow of the Institution of Mechanical Engineers.
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.
CrystecPharma
CrystecPharma is based in Bradford, United Kingdom, with a wholly owned subsidiary research company based in Tianjin, China. CrystecPharma engages in contract and collaborative research, as well as licensing proprietary technology and intellectual property in solid state pharmaceutical materials. The CrystecPharma team consists of the some of the world's most well known scientists in the field, including Peter York (co-founder of Bradford Particle Design ), Lyn Daintree and George Townend. Combined the team has over 50 years experience in super-critical fluid technology in pharmaceutical particle engineering. CrystecPharma are committed to excellence in science and innovation, operating to the highest standards of customer service, professionalism, integrity and employment.
CrystecPharma
CrystecPharma is based in Bradford, United Kingdom, with a wholly owned subsidiary research company based in Tianjin, China. CrystecPharma engages in contract and collaborative research, as well as licensing proprietary technology and intellectual property in solid state pharmaceutical materials. The CrystecPharma team consists of the some of the world's most well known scientists in the field, including Peter York (co-founder of Bradford Particle Design ), Lyn Daintree and George Townend. Combined the team has over 50 years experience in super-critical fluid technology in pharmaceutical particle engineering. CrystecPharma are committed to excellence in science and innovation, operating to the highest standards of customer service, professionalism, integrity and employment.