Nanotech Week: Investing in Medical Nanotechnologies II

7th December 2007

Sponsors:
Mti
Marks&Clerk Solicitors

List of speakers

The Institute of Nanotechnology (IoN) held its second conference on investment in medical nanotechnologies at the Royal College of Surgeons, London.

The purpose of the two day event (28th-29th November) was to bring together companies, investors, entrepreneurs, authorities and medical professionals interested in the unique benefits (of) nanomedicine.

Among the following issues raised were:

Funding
Codes of conduct
The term Nanotechnology

In the Netherlands, concerns have been raised over foreign VC investment. Dr. Elaine Schutte (Signifix) spoke of the loss of investment when an idea/SME has received further (private) investment outside its own territory, e.g. the United States. The result can mean the eventual move of infrastructure. Currently, the Dutch governments’ grant funding is € 25 million.

Renzo Tomellini, Head of the Nanosciences and Nanotechnologies Unit (EU Commission) stated nearly €1.4billion in EU funding has been invested in more than 500 projects. He recognises the “financial gap between this (EU) and private funding.”

Pharmaceuticals

Professor Clive Washington’s (AstraZeneca, UK) talk included low strategies and early and late buying-in: “There are low strategies in nanotechnology within the pharmaceutical industry as opposed to other market segments. He stressed the importance of securing IP from the beginning, after “identifying the therapeutic target.”

When to buy-in?

Washington recommends shortening the average industry timeline of nine years (discovery, preclinical, etc) within the pharmaceutical industry in order to have a strong impact on drug delivery.

Early: quickly register IP; in-house resources; people, etc. The result, “IP can expire before product comes through.” Late: “low loss. Someone else’s shareholders have made the losses.”

Washington gave the following examples of new technologies: Bio Pharmaceutical and Advanced Drug Delivery. “The (Advanced Drug Delivery) industry currently has no well-defined formulation discovering” process.

This is the “gateway to attract funding.” Washington stated that “technical developments are done by start-ups and spin-offs.” And that “Critical Partnering” is crucial in helping to further develop a product. IP is hard to pin down for formulations and drug patents re: “nanosimilar products”; when they are structured the same as others.

What is the future of nanomedicine?

Working practices should enable the development of both molecules and formulation. In the past the industry has been accused of inflexibility however this is rapidly changing. Start-ups need to be supported, “getting sales people out there”, have the “marketing set up.”

Currently the range of products and services are diverse. It was said that some of these advancements have been around for up to ten years, but they have not reached the market. Time and again, many of the speakers stressed the importance of the outcome being the benefits to the patient.

There are neither specific regulations nor guidance in the pharmaceutical area re: nanoparticles. Robert Geertsma (RIVM) discussed the need for a new classification rule for “free nanoparticles.” The UK has a volunteer scheme although he said “it’s not been successful.”

Geertsma suggested a Volunteer Reporting Scheme (VRS) and to develop a regulatory guidance. He hopes there will be one “especially as there are combination products; “safety with availability of innovation” when using nanotechnology.

At one point his talk became a heated debate between Geertsma himself and a member of the audience as to the different health impacts and risks of nano particles and the term nanotechnology itself. Geertsma thought it was important to talk about all the risks of nanoparticles, products and technology.

The audience member raised the importance of public perception and the term nanotechnology and how it is being used. He gave the example of nanomechanical instruments “which may not have nanoparticles. Things may be nano in size but not have been made using nanotechnology.” More people joined in the debate. One man said that enforcement of a (VRS) “must not and should not be enforced. “To help make it successful it must be explained to both volunteer and governance/guidance.“

He believes that “areas should have their own codes of conduct; standards would be constructive.” Another audience member mentioned the Nano Code and that he had three different versions of a questionnaire on his desk. Another audience member said the ENTA will be meeting on 5th December 2007 to discuss Nano Codes. Several attendees had all three questionnaires.

Tomellini spoke of differing codes of conduct; one for researchers and one for business. They are both in the advanced drafting stage. They are not legally binding. However, courts can “take them into account in grey areas”. “No one wants regulation” but rather to “spread the culture of responsibility.” Tomellini said that “DuPont are developing a code of conduct.”

Dr. Thomas Keller (GlaxoSmithKline) pointed out that “there are no standards given to date for the pluses and minuses to nanomaterials.” One of the issues he raised was the lack of ”joined up thinking” despite “lots of initiatives.” GSK “are working with institutions and wants to participate but they feel governments and institutions need to take the lead on this.”

Tomellini believes in an “integrated and responsible approach to nanotechnology in strategy, action plan and report.” It should be “policy guided and inclusive approach, not top-down.”

Keller said GSK recently shut down their nanotechnology department of 40 people. He said it was “not the time to create a nano department. “ Instead GSK will be outsourcing their nanomaterials by “partnering with the finest in the world.” Eleven steps are taken for nanomaterials and “these approaches need to be integrated across from discovery to development. “ Both Keller and Dr. Ogan Gurel (XRoads, LLC) believe matrix management is needed, by “bringing (together) people from different disciplines.”

Gurel said that nanotechnology “requires almost everything to happen at the same time.” It is an enabling technology. “Because of this it’s difficult to value it - it’s not one single thing.” It is a “platform technology.” Therefore, partnerships are important.

He referred to GSK’s outsourcing rather than having anything done in-house. “Chief Partnership Officer is an important role as well as innovation partnering “even at the supplier level.” Gurel believes that the “VC model is not suited for nanotechnology or nanomedicine.” He believes “philanthropic funding helps to prevent the innovation gap.

Good people cost and it is important to have “top-notch management. However, many of the nanomedicine products are “not market orientated as they’re not about making money.” He feels “a holding or large company can help to offer some management. “

One of the investors I spoke with said this was off putting and not what an investor wants to hear. This investor (who wishes to remain anonymous) thought the mix of investors, scientists and chemists was inappropriate as the messages were mixed.

Receiving further funding is vital to the success of medical nanotechnologies (and other areas of industry) within the UK and Europe. More than ever, a clear definition of nanotechnology is required. People using nanotechnology within their industry sectors must come to some agreement. At this point in time they all seem to be searching for guidance.

It is important that investment is found to further develop the discoveries and SMEs. They are the driving force behind so much in this field.

Business Analyst Dr. Nicola Bailey (Wellcome Trust) said the Trust gives away £350-400million per year, both UK and overseas . The Trust is “looking in a health care product that will make a difference but which is not necessarily elegant. The financial return as a charity is not the end result - it is the impact on health care.”

Bailey went on to describe what she calls “the valley of death” or the innovation gap when universities and SMEs “want to see further development however they are unable to receive further funding. Bailey said that an IP does not necessarily need to be in place but “there needs to be the freedom to operate and a plan.” As it is a charity, the IP would remain the property of the university or SME. The Wellcome Trust also funds companies. She stressed the importance of “internal due diligence -checking patents, etc. They have in-house lawyers.

Perhaps it would be wise to put differing opinions aside when there is a mixed audience. The purpose of the two day event was to attract investment not drive it away. It is clear the developments they have made thus far are important. (Many of which have the potential to be used in other areas of industry, not solely medicine.) It would be a loss to us all if further investment is not made. One important area is that of Cancer. This will be discussed at another time.

Many thanks to
Carrie Smith, Events Manager, IoN
and to the Royal College of Surgeons