Business Development And Its Information Needs
JJ Owen, AVEO Pharmaceuticals
Bob Bennett, Merrimack Pharmaceuticals
March 2007
Agenda
Introduction – Our Background
Business Development
Who and What do they do?
Case Study: In-licensing
Outputs and Sources
Creating Value: Beyond the Sources
Our Background
JJ Owen
Bob Bennett
Years in Industry
7
9
Education
Ph.D. Biology
M.S. Chemistry
M.B.A.
Work Experience
Cell Biologist
Proteome/Incyte
Knowledge Mgmt
Sci & Comp Analysis
Bus Dev
Organic Chemist
Sci & Comp Analysis
Bus Dev
Company
AVEO Pharmaceuticals
Merrimack Pharmaceuticals
Position
Business Development
Business Development
Size of Company
80
60
Size of Bus Dev
3
3
Who is Business Development?
Small organization
Mostly MBA trained (some with science backgrounds)
Typically marketing or finance backgrounds
Prior background - consultants
Intimately aware of several data sources
Unaware of a large majority
Time crunched deadlines is the norm
Attention span of a gnat
Job focus & data source needs constantly changing
Business Development – What do they do?
Mergers &
Acquisitions
Deal
Negotiation
Public
Relations
Technical
Writing
Financials
Market
Analysis
Licensing
Activity
Competitive
Landscape
Traditional activities
Competitive
Intelligence
Project
Managemen
t
Non-traditional activities
Case Study – In-licensing
In-licensing has been described as…
…Finding a needle in a haystack
In-licensing: Process Flow
Finding Leads
Making the Case
 Conferences
 Company Profiles
 Connections
Key Personnel
 Secondary Sources
Pipeline snapshot
 Primary Sources
 Target Sweeps
Tracking database
Financials
Deals
 Competitor Pipelines
 Clinical Trial Data
 Commercial Profile
Market Data
Pursue Opportunity
Case Study – In-licensing
Finding Leads
Finding Leads
Attend conferences
AACR, ASCO, CHI, SRI, EORTC, many, many others
Connections
Who do you know?
Secondary Sources
Thomson Pharma, BioCentury, BioWorld, NewsFeeds, WWW
Primary Sources
Investors, SAB, BOD, Consultants
Target Sweeps
Akt inhibitors
Company
Drug
Highest Dev. Status
ASTA Medica AG
perifosine
Phase 2 Clinical
Novartis
AEE-788
Phase 1 Clinical
RX-0201
Phase 1 Clinical
Rexahn
Abbott Laboratories
AEterna Zentaris Inc
Amphora Discovery
Sources
AKT kinase inhibitors, Abbott
Thomson
Pharma, Company Websites,
erucylphosphocholine
Akt1 inhibitors, Amphora
Newsfeeds
Discovery
Discovery
Discovery
Berlex Biosciences
BX-424
Discovery
Bristol-Myers Squibb
BMS-536924
Discovery
Cellular Genomics
Akt-1 inhibitors, Cellular Genomics
Discovery
Consensus Pharmaceuticals
anticancer agents, Consensus
Discovery
Institute of Cancer Research UK
PKB inhibitors, Astex/ ICR/ Cancer Research UK
Discovery
Kinetek Pharmaceuticals
protein kinase B (PKB/Akt) inhibitors, Kinetek
Discovery
Merck
Akt protein kinase inhibitors, Merck & Co
Discovery
National Cancer Institute
azoacridone anticancer agents, NCI
Discovery
National Cancer Institute
EM-12
Discovery
National Cancer Institute
RTA-502
Discovery
NeoGenesis Pharmaceuticals
Akt-1 inhibitors (cancer), NeoGenesis
Discovery
Nerviano Medical Sciences
Akt kinase inhibitors (cancer), Nerviano
Discovery
Case Study – In-licensing
Making the Case
Company Profiles - MGI Pharma
Overview
•
•
•
•
•
•
•
•
Pipeline
Headquarters: Bloomington, MN, Lexington, MA (MGI Biologics)
Therapeutic Focus: Entities (small molecule or Biologics) for cancer treatment and supportive care
Technology: BIOTOPE (targeted plasmid system) and GENCAP (DNA protection)
Strategy: Acquisition of clinical stage development compounds
Investors: Publicly traded on NASDAQ (MOGN)
Cash Position: $205.5M
Market Cap: $1.65 B ($1.65 B Enterprise Value)
Employees: 282
Partnering Rationale
Sources
Aloxi
Drug
Indications
Chemo-induced Nausea and vomiting
Stage
Marketed
Salagen
Dry mouth
Marketed
Hexalen
Ovarian
Marketed
Dacogen
MDS, Leukemia, Solid Tumors
Registration
Irofulven
Ovarian, Liver, Prostate, Pancreatic
Phase 2
Saforis
Mucositis
Phase 3
ZYC101A
Cervical dysplasia
Phase 2/3
ZYC300
Cancer cells expressing CYP1B1 protein
Phase 1/2
MG98
MDS, AML
Phase 1
--Aloxi (licensed NA rights from Helsinn SA)
--Salagen (retains NA marketing rights)
--Hexalen (retains WW rights)
--Dacogen (Decitabine) (acquired WW rights from SuperGen)
• Small molecule, DNA methyltransferase inhibitor
• P3 mono, MDS, 170 pts: RR 17% vs. 0% for supportive care
• P2 mono, Gleevec ref. CML, 27 pts: 17 hema. response
--Irofulven (retains WW rights)
• Small molecule acylfulvene, breaks DNA strands
• P2 mono, rel/ref Ovarian, 55 pts: 1 CR, 9 PR
• P3 mono, ref Pancreatic: OS inferior to 5-FU
• P2 with ERCC3 gene deficient pts underway
• P2 mono, liver, 48 pts: 2 PR, 18 SD
--Saforis (retains WW rights), Phase III, mucositis
--ZYC101a (acquired in purchase of ZYCOS )
• Antibody, completed Phase II, 161 pts, RR 43% vs. 27%, drug was well tolerated
--ZYC300 (acquired in purchase of ZYCOS)
• Antibody, completed Phase I/II, 17 pts, ASCO 2003, drug was well tolerated and biologically
active
--MG98 (licensed NA rights from Methylgene)
• Antisense oligonucleotide, inhibits DNA methyltransferase-1
• P2 RCC, IFN combo: Initiated 10/04
--Thomson Pharma, Recap, Company website,
Yahoo Finance, SEC
•Potential collaboration partner with our discovery platform and their therapeutic Antibody program
•Aggressive late stage up and coming Oncology development company with cash and solid market cap
Recent News
4/05: MGI PHARMA Reports First Quarter Results
1/05: Dacogen NDA filing for MDS accepted by FDA
12/04: Dacogen P3 trial results in MDS reported at ASH
10/04: Dacogen MAA filing for MDS accepted by EMEA
9/04: Begins promotion of Kadian to oncologists
9/04: Acquires WW marketing rights for Dacogen from SuperGen
9/04: Acquires Zycos for $50 M in cash
9/04: Acquires Aesgen for $90 M in cash
7/04: Kadian marketing agreement for oncology market with Alpharma
MGI Pharma
Personnel
Key Officers
Leon O. Moulder, President and CEO
Prev at Eligix, Inc., Hoechst Marion Roussel (now Aventis), Marion Laboratories, and Marion Merrell
Dow.
James C. Hawley, SVP, CFO
Recently joined MGI Pharma, Prev. CFO and corporate secretary at CIMA LABS, principal with
Manchester Companies, Inc., and Orthomet
Michael T. Cullen, CMO
Prev at Searle/Pharmacia
Martin J. Duvall, SVP, Commercial
Operations
Prev 18 yrs at Aventis
Mary Lynne Hedley, SVP, MGI Pharma
Biologics
Cofounder of ZYCOS, Inc. and most recently served as president and chief executive officer
Board of Directors
Andrew J. Ferrara
President and CEO of Boston Healthcare, managing partner of Boston BioLicensing, L.L.C.
Gilla Kaplan
Current head of the Laboratory of Mycobacterial Immunity and Pathogenesis, The Public Health Research Institute,
Newark, NJ.
Edward W. Mehrer
CFO of CyDex, a drug delivery company. Board member and audit committee chair of Novastar Financial
Hugh E. Miller
Chairman, retired from ICI after a 22-year career
Lonnie Moulder
See profile above
Lee Schroeder
President and director of Lee Schroeder & Associates, Inc.
David B. Sharrock
Director of Interneuron Pharmaceuticals Inc., Praecis Pharmaceuticals, Incara, Broadway, and The Ohio State
University Foundation
Waneta C. Tuttle
CEO, Southwest Medical Ventures, and CEO, Exagen Diagnostics, Inc.
Arthur L. Weaver
Leading rheumatologist, serves as medical director of Arthritis Center of Nebraska
Financials
Income Statement (12/31/2004)
Revenues
$195.7 M
COGS
60.0 M
R&D Expense
62.6 M
SG&A Expense
73.8 M
Acq. R&D Expense
83.1 M
Operating Income
(84.7 M)
Interest Income
5.3 M
Interest Expense
(6.0 M)
EBT
(85.4 M)
Balance Sheet (12/31/04)
Assets:
Cash and Equivalents
205.5 M
Accounts Receivable
122.3 M
Inventories
8.4 M
Other Current Assets
5.8 M
LT Investments
75.4 M
Property, Plant and Equipment
2.7 M
Intangible Assets
8.0 M
Total Assets
436.3 M
Liabilities:
Current Liabilities
Long Term Debt
Other Liabilities
Total Liabilities
Shareholders Equity:
Net Shareholders Equity
Total Liabilities and SH Equity
58.8 M
260.2 M
2.8 M
321.8 M
114.5 M
436.3 M
MGI Pharma
Deals
9/04: Acquires privately held Zycos for $50 M in cash
• Acquires expertise in immunology and development of biologics
• See Pipeline for clinical data
9/04: Acquires privately held Aesgen for $32 M in cash
• Pays $32 M upfront, milestones of $33 M for approval and $25 M if annual sales exceed $50 M plus royalty of 5%
• Acquires Saforis, a P3 compound for oral mucositis
9/04: Licenses WW rights to Dacogen from SuperGen
• P3 completed in MDS with an NDA expected 4Q04
• Possible expansion into AML, CLL and solid tumor
• Pays $40 M equity investment, up to $45 M in milestones, at least $15 M in development costs and royalty from 20-30%
7/04: Kadian marketing agreement with Alpharma
• Kadian is a sustained release morphine marketed for pain relief
• 3 yr agreement for MGI to market Kadian to oncologists
• Undisclosed profit sharing agreement
4/01: Licenses NA commercialization rights for Aloxi from Helsinn
• Aloxi is a P3 product for chemotherapy induced nausea and vomiting
• Pays $11 M upfront, undisclosed milestones and royalties
• Helsinn funds development and responsible for manufacturing
• 4/03: Collaboration expanded to include post-operative nausea and vomiting indication and an oral formulation
• Pays $22.5 M upfront and up to $25 M in milestones
1/01: US marketing rights for Mylocel from Barr Labs
• Mylocel (hydroxyurea) marketed for melanoma, CML and ovarian cancer
• Barr receives undisclosed royalties
Competitive Landscape: Late Stage
Breast Cancer Targeted Therapies
Drug
Lapatinib
(GW2016)
Avastin
MOA
Inhibits EGFR
and Her2
Current
Phase
Phase III
Latest Breast Cancer Trial Data
Phase III combination trials, Lapatinib with:
• Capcitebine, first line metastatic, on-going
• Paclitaxel, first line metastatic, on-going
• Letrozole , first line metastatic, hormone eligible
patients, on-going, interim analysis – 35% RR
VEGF inhibitor
Phase III
Phase III trial for an Avastin-Capcitebine combination
Sources
failed to meet primary endpoint
--Thomson Pharma
Phase III trial in comb w Paclitaxel, 700 pts, first line
metastatic,
28% RR
vs 14%, PFS 10.9 mo vs. 6.11 mo
--Clinicaltrials.gov, ASCO
abstracts,
DataMonitor
Expected
Filing Date
Late 2006
Early 2007
Late 2006
Early 2007
ABX-EGFR
Her2 antibody
Phase II
Phase II trials in solid tumors indicates solid data in
several tumor types. Amgen/Abgenix appears to be
targeting Colorectal cancer
Not applicable
Omnitarg
(pertuzumab)
Her2 antibody
Phase II
Interim data from ASCO, open-label randomized trial,
79 patients, 2 cohorts, 2 PR, 32 SD
Not Applicable
Market Analysis: Breast Cancer Epidemiology
and Current Treatment Paradigm, 2004
Incidence
412,894
Prevalence
2,714,400
Mortality
121,197
1 yr survival
97.5%
5 yr survival
86.5%
Current Treatment Paradigm
Late Stage
Early Stage
Sources
Options dependent on status
Surgery --DataMonitor, WWW, GloboCan, American Cancer
society, NCI
Chemotherapy
-Paclitaxel and Docetaxel
Hormonal Therapy
Adjuvant Therapy*
-Tamoxifen or Arimidex
Hormonal Therapy
Chemotherapy
Targeted Therapy
Tamoxifen
AC (doxorubicin +
cyclophosphamide)
-Herceptin (Her2+ only, 25% of
Arimidex
CMF (cyclophosphamide +
patients)
methotrexate + fluoracil)
*depends on hormone receptor and menopausal status
Business Development Sources
Extremely limited resources, always looking for the best
“bang for your buck”
Choice of source is critical when one has money
Public sources, public sources, public sources
Current Gaps
Sales projections
Analyst reports
Clinical trial data
Deal details
I Know How To Search For Information!
Of Course, You Know Better
Perception vs. Reality
Does Information Flow Freely?
Demand
Supply
How Is Information & Analysis Delivered
In Your Organization?
Newsletters
Literature Alerts
Conference Reports
Interactions with individuals
Membership on project teams
On-line requests
Journal subscriptions
Department webpage
Provide access to databases
Value Is Created In Each Step Of The Process
Access
Greater breadth of information sources
Timeliness
Rapid access to information through knowledge,
effective searching, and alerts
Subject
Knowledge
Cut through the noise, recognize critical info,
provide analysis, deliver exec summaries
Delivery
Multitude of delivery mechanisms
Reduce time to customer
How Would An Information Professional Assist Bus Dev?
Added Knowledge
Sources, limitations, and effective use
Focused Data
Quality, accuracy, completeness, analysis
Efficient Use Of Time
Division of labor
Assist In Budgeting
Able to forecast information needs as company matures
JJ Owen:
AVEO Pharmaceuticals
jjowen@aveopharma.com
617.299.5889
Bob Bennett:
Merrimack Pharmaceuticals
rbennett@merrimackharma.com
617.441.1008
Thank you