Show Notes:

In the news this week, the 2017 federal budget is out and we go one-on-one with BIOTECanada’s Andrew Casey to find out if it delivers on the promise of an Innovation Agenda, the NRC and the Centre for the Commercialization of Antibodies and Biologics (CCAB) colloborate on an antibody development initiative, and Bellus Health divests itself of Thallion Pharmaceuticals.

We have all this and more coming up on Biotechnology Focus Radio.

Welcome to another episode of Biotechnology Focus Radio. I’m your host Shawn Lawrence, here to give you a rundown of the week’s top stories on the Canadian biotech scene.

Story 1

Our first story this week takes us to Vancouver, where Qu Biologics Inc. reports it has identified immune factors (cytokines and growth factors) in the blood of patients with Crohn’s disease that may predict response to its Site Specific Immunomodulators (SSIs) therapy. According to the company, SSIs are a unique platform of immunotherapies designed to restore the body’s innate immune system.

Their discovery was made following further analysis of Qu Biologics recently completed Phase 2 Study in Crohn’s disease. The company says that when combined with patients’ clinical profiles, these biomarkers seemed to coorelate with identifying patients likely to respond to SSI treatment. Dr. Hal Gunn, CEO of Qu Biologics, explained these findings could  mean that patients with Crohn’s disease may now be closer to having precision treatment for their condition for the first time.  In addition, Qu Biologics’ Phase 2 randomized placebo-controlled Crohn’s disease trial results demonstrated that specific blood immune markers associated with immune activation and mucosal healing increased with SSI treatment and SSI response/remission. The company says it plans to initiate a follow-on clinical trial in Crohn’s disease later in 2017 to confirm the value of these blood immune biomarkers in predicting and monitoring response to SSI therapy.

Story 2
The National Research Council of Canada (NRC) and Toronto-based Centre for the Commercialization of Antibodies and Biologics (CCAB) are teaming up to advance new innovative therapies discovered out of the University of Toronto. Through this innovative collaboration between government, industry, and academia,  the NRC and the (CCAB) have over the past year already put in place over $1M in collaborative agreements to produce and test therapeutic antibodies discovered at the University. CCAB is a business development and commercialization engine whose mission is to translate UofT’s large portfolio of early stage biologics into high-value assets and products. To this purpose, CCAB has partnered with NRC to biomanufacture and test hundreds of antibodies. With this announcement, the collaboration continues to grow and now leverages NRC’s three programs in Human Health Therapeutics: 1. Biologics and Biomanufacturing: producing biologics, testing their ability to fight solid tumours, and determining their biomanufacturability; 2.  Therapeutics Beyond Brain Barriers: determining if specific antibodies are able to cross the blood-brain barrier, target and fight brain cancer; And 3. Vaccines and Immunotherapeutics: determining if specific antibodies are able to modulate the immune system so that it finds and destroys cancer cells.  As cancer treatment evolves rapidly toward more effective molecules, including single-domain and bi-specific antibodies, antibody-drug conjugates, and immunotherapies, these types of medicines, also called biologics, are able to specifically target cancer cells and in some cases, recruit the body’s immune system to help destroy them. The goal of the collaboration is to identify the most promising antibodies, and increase their value by generating data that effectively de-risks each asset. CCAB says its objective is to then licence lead antibody candidates to seed newly formed Canadian biotechnology companies.  These new Canadian start-ups will, in turn, advance these molecules toward clinical trials in patients.  With several biotechnology companies already participating and benefitting from these programs, the collaboration between CCAB and NRC is clearly set to catalyze the country’s biotech sector and generate promising new cancer treatments for Canadians.

Alexion licenses Arbutus’ LNP delivery technology
In business news, Alexion Pharmaceuticals has negotiated a license to use Vancouver-based Arbutus Biopharma’s lipid nanoparticle (LNP) delivery technology for one of its rare disease messenger RNA (mRNA) therapeutic candidates. As part of the deal, Arbutus will earn $7.5 million upfront from Alexion and potentially another $75 million in development, regulatory, and commercial milestones, plus single-digit sales royalties. Arbutus will also carry out technology development and provide manufacturing and regulatory support for the Alexion mRNA candidate. Arbutus Biopharma itself is currently focused on developing a cure for chronic hepatitis B virus (HBV) infection. Dr. Mark J. Murray, Arbutus’ President and CEO said this transaction with Alexion illustrates the value of his company’s LNP platform, which he believes has broad potential to deliver mRNA and gene editing therapeutics. He adds that Arbutus is receiving significant interest from companies that require access to the LNP platform to enable their own development programs

BELLUS Health sells Thallion Pharmaceuticals subsidiary to Taro Pharmaceuticals
BELLUS Health Inc. reports it has entered into a share purchase agreement with Taro Pharmaceuticals Inc. (Taro) for the sale of its wholly-owned subsidiary Thallion Pharmaceuticals Inc. as well as the rights to the drug candidate Shigamab™. According to Bellus, the asset, Shigamab™, is a monoclonal antibody therapy being developed for the treatment of Hemolytic Uremic Syndrome caused by Shiga toxin-producing E. coli (STEC) (sHUS), a rare disease which principally affects the kidneys and often leads to acute dialysis, and in certain cases chronic kidney disease and death, primarily in children. Pursuant to the sale, Taro is acquiring all issued and outstanding shares of Thallion for a potential total consideration of CA$2.7 million, consisting of an upfront payment of CA$2.3 million and a potential future payment of CA$0.4 million contingent upon the completion of a pre-established milestone event, expected to occur within 24 months of the closing of the transaction. Additionally, BELLUS Health will receive a portion of certain post-approval revenues related to the Shigamab™ program.

Story 5
In our feature story this week, on March 21st, the federal Liberal government officially presented their second budget since coming to power.

In our feature story this week, on March 21st, the federal Liberal government officially presented their second budget since coming to power. In the months leading up to its release, this budget was of course billed by the Feds as the Innovation Budget, and certainly at first glance there are a few initiatives where spurring innovation or forming an Innovation Agenda for Canada is its goal.  But has this Budget measured up to its promise? Has the government truly delivered with Budget 2017 an Innovation Agenda to hitch our wagons to?

We have with us today, Andrew Casey, CEO and president of BIOTECanada, the national organization that represents health care, agricultural, food, and research groups involved in biotechnology to find out if government has hit the mark or missed it in terms of delivering on its innovation mandate.

Hello Andrew and welcome to the show.

1. Going into Budget 2017, there were many surveys, consultations and open dialogue between Government and industry, on what we wanted to see from this Innovation Agenda budget. Straight to point, did Budget 2017 live up to its hype?

1. For BIOTECanada, what was on your wishlist- what were you hoping to see in the budget?
2. What were the asks on the wish list that were answered, and which asks weren’t?
3. Let’s look deeper, in our analysis of the investment summary, the biggest program of interest seems to be the $950 million “super clusters” fund, that will be an open competition in 2017 across six innovation industries, with biotech of course being one these industries. Like with most such initiatives there is of course some worry that biotech as one of the six, may not get it proverbial portion of the pie, does BIOTECanada see it this way, or do they feel that our industry can benefit from this fund?

   5. In terms of strengthening science in government, Budget 2017 proposes to establish a new chief science advisor for Canada, what should we expect to see from the creation of this new role?

4. There was also $6 million earmarked for stem cell research, and organizations in that field like the Stem Cell Foundation and other stakeholders seemed satisfied in that commitment, but on a grander scale, does that really compare with other leading jurisdictions in the field? Are those funds enough to capitalize on Canada’s strengths in this field?
5. What we found interesting as well in Budget 2017 was the proposal of a new procurement program, called Innovative Solutions Canada, modeled on the SBIR (Small Business Innovation Research Program) in the U.S. with $50 million to go into this program. For comparison sake, in Fiscal Year 2016, the NIH’s SBIR and STTR programs south of the border will invest over $870 million into health and life science companies, so how does our commitment stack up? Is it a good first step into this arena?
6. Glancing at the investment summary, we also noticed that basic research programs, such as the Tri-Councils, were not mentioned. Why do you think that was?
7. Finally, another industry ask is always around supporting venture capital and Budget 2017 proposes $400 million over the next three years for a new Venture Capital Catalyst Initiative. Is this separate from the $400 million Venture Capital Action Plan from year’s past?
8. Were there any other examples where existing funding and credits were maintained or even expanded upon in Budget 2017.

Well Andrew, thank you for joining us today on our show and for your breakdown of #BUDGET2017, it’s always a pleasure for us to talk with you and get your insights on key industry topics.