People behind a project become key to earliest stage funding

March 13, 2014 ctheodoropulos

Pharma is moving aggressively from funding validated targets to backing validated people, scientists or entrepreneurs with little more than an idea and a solid reputation. Susan Schaeffer, Editor of BioCentury, moderated a session at BIO-Europe Spring® in Turin that explored financing at the earliest of early stage programs and turned up surprising insights.

“The earlier you go, the murkier the value against obvious risks, cautioned Daniela Bellomo, Managing Director at TTFactor, a technology transfer organization (TTO) whose mission is supporting researchers and clinicians with patent filings, licensing, sponsored research and spinoff creation.

Her organization reflects precisely what encourages Jeanne Bolger, vice president for Venture Investments at Johnson & Johnson Development Corporation. She is working to help potential projects through what she called a second Valley of Death.

Traditionally, she said, “A clinical proof-of-concept for a relevant target population is the real value inflection point and the first valley is where preclinical biology needs to be translated into meaningful treatment for patients. But even earlier it is rare to even have a molecule, just interesting biology without a full insight.”

Bolger’s work includes establishing Innovation Centers to engage with investigators and TTOs and she said, “What has changed recently with certain tech transfer offices is much more meaningful collaborations to get this science translated, if only to get to a point of preclinical insight, to get people thinking about what something might mean in terms of an impact on patients.”

As Investment Manager of Boehringer-Ingelheim Venture Fund, Ilka Wicke provided examples of upstream investments that began with only an idea and a strategy. “We have started from scratch,” she said. “There was not much to build on except a very strong team with a very bright strategy, three founders very well respected in the area who can take a multidisciplinary approach.  This was compelling for us. And it is a route we will follow with other programs.”

Management became a central theme that Schaeffer explored with the panelists.

“It doesn’t matter how much money is being asked for, because management is the key limiting factor, not money,” said Graziano Seghezzi from Sofinnova Partners, which has already invested in 11 very early stage projects since creating a new fund in 2013. Often, he said, Sofinnova is not only looking just at technology or products but at management teams.

“With this approach we can go as early as having nothing, just an idea, making a bet instead with people we know very well,” he said, giving examples of two oncology projects built in this way.

Where there is an asset, “the earlier we go in, the more we need to see the technology and the potential applications. From the get-go it has to be something big with a very large medical need. It needs to have multiple shots on goal so that we are not taking a risk on a single attack,” he said.

Jason Coloma, Roche

Over the past year, Jason Coloma has restructured Roche Partnering to move boldly upstream in drug discovery as the Global Head for Venture and Innovation. (http://www.partnering360.com/insight/showroom/id/463)

“The sweet spot has shifted with a willingness to take on risk-sharing models much earlier,” he agreed describing Roche’s new External Innovation Network. Here the emphasis is also taking the form of people, and where necessary, he said, Roche will “be very creative, moving the science to where the management is.”

 

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