The end of the pioneer trail

Australia's first ever Cooperative Research Centre is winding up operations. Melissa Trudinger joined its stakeholders for a look back at its successes.

In the last 13 years, the Cooperative Research Centre for Cellular Growth Factors (CRC-CGF) has published something in the order of 400 papers, filed more than 60 patent applications, engaged in numerous commercial agreements and partnerships, and seen 52 PhD students, 28 honours/masters students, four bachelor of medical science students and 62 undergraduate research program students pass through.

To top it off, one of the receptors discovered by CRC researchers about 10 years ago was last year the subject of a royalties deal worth more than US$112 million between CRC industry partner Amrad and pharmaceutical behemoth Merck & Co.

It's a record that participants in Australia's very first CRC are proud of. It's also an indication of just how far-seeing government programs designed to foster innovation and commercial success need to be. Conventional wisdom says it can take 10-15 years to develop a drug -- when you add the basic research required to come up with a validated target for drug development, the time span can stretch into decades.

"The message to the government is that they need to think in the appropriate time frame and give people breathing space [to accomplish what they set out to do]. Otherwise, people redirect their energies to fill the appropriate boxes and switch to a shorter-term focus instead," says WEHI's Prof Nic Nicola, the CRC's first director. "That's been one of the really great things about the CRC program -- the seven years' funding -- but it came with a lot of reporting."

Ironically, in 1990 when the CRC program was first announced, Sir Gus Nossal, then the director of the Walter and Eliza Hall Institute of Medical Research, and Prof Tony Burgess from the Ludwig Institute for Cancer Research, thought the program would be a good way of getting extra funding without being subject to the bureaucracy associated with the normal grants system, says Nicola.

Keeping it at home

The concept of the CRC was built around the previous scientific achievements by WEHI in discovering growth factors such as GM-CSF and G-CSF with the idea that these discoveries could be commercialised in Australia rather than being lost to overseas.

"One of the things we had been criticised for is that discoveries like GM-CSF and G-CSF didn't return maximum benefits to Australia -- but we didn't have the structure to drive commercialisation of our discoveries," Nicola says. "Also in our thinking was that we needed to do the research on a greater scale -- we needed more critical mass and access to resources."

So an application for an Australian Growth Factors CRC was duly submitted by a consortium consisting of WEHI, the Ludwig Institute, the Biomolecular Research Institute, CSIRO's Biomolecular Engineering group, and commercial partner Amrad, which had been formed in 1986 to commercialise the science coming out of four of Victoria's medical research institutes.

The original concept was simple and has remained so through two terms of funding and nearly 13 years: the production of growth factors for clinical testing, including the discovery of growth factors and cytokines, and their receptors, analysis of structure and function, genetic engineering to produce the factors, and development of monoclonal antibodies and more recently small molecule drugs capable of moderating growth factor receptor-ligand interactions.

"Tony Burgess thought the CRC would become the centre of the biopharmaceutical industry in Australia," Nicola told past and present researchers at a retreat held at Lorne, coastal Victoria, to celebrate the achievements of the CRC-CGF.

The biggest challenge of setting up the CRC, says Nicola, was the novelty of the program -- it was new for all stakeholders including the government. There were few guidelines, particularly when it came to figuring out things like how to handle ownership of intellectual property and design of performance indicators. And the management was soon inundated with paperwork.

"The science, in a sense, was the easiest part as we all had a common vision centred around growth factors and their pharmaceutical potential," he says.

The CRC was simply structured as an unincorporated organisation -- a model that has endured through the CRC's two terms, despite a shift within the CRC program to favour incorporation. Industry partner Amrad would get first rights on any prospects for commercialisation arising from the collaborative projects that formed the heart of the CRC, and in return the member organisations would receive a proportion of any milestone and royalty payments.

Nicola says his biggest challenge, once the CRC was established, was to create a working environment where the participants would simultaneously retain their individual identities, but work cooperatively within the CRC organisation.

His views are echoed by Prof Doug Hilton, who took over as director from Nicola in 1997 as the second CRC term began. "The biggest challenge of the CRC was creating an independent culture when all were employees of various institutes," Hilton says. "There was a sense that the CRC was competing, so there was some tension there."

Central core

One unique initiative of the CRC was the creation of central laboratories, which provided core facilities for fermentation (at CSIRO), molecular biology, protein chemistry and monoclonal antibody production (all at WEHI). For the first five years, 25 per cent of the annual budget went towards establishing and maintaining these facilities, and over time the labs have grown to be a crucial aspect of the CRC.

"As the director, the central labs gave me the only power I had to redistribute resources to important projects. It was a way of adding value to being in the CRC and provided the capacity for the director to drive projects," Nicola says.

The facilities have also been made available to non-CRC projects as appropriate, and are likely to keep going once the CRC has been wound down. "In our third review, when we decided not to seek a third term, the central labs were identified as a great national resource and recommendations were made to keep them," says Nicola.

Another challenge facing the CRC throughout its term was learning to let go of projects that were not going to deliver -- a process that Nicola says required a level of trust between the participants and the CRC management. "[Dropping projects] can be a bit traumatic and difficult for people. We developed mechanisms so that it could happen without bitterness," he says.

Over the years the CRC has been steadfast in its portfolio approach -- rather than concentrating on one or two key projects, it has maintained a portfolio of projects, all with commercial potential.

"Some good science isn't going to lead to products. Retaining a portfolio of potential commercial or pharmaceutical projects is very important," says Dr John Flack, the current director of the CRC.

The CRC-CGF's record has been exceptional in its achievements. On the scientific side, there have been numerous discoveries, including structure and function studies of leukaemia inhibitory factor (LIF) that ultimately led to the development of potential therapeutic applications and clinical trials, identification of receptors for growth factors and cytokines including GM-CSF, IL-11, IL-13 and Leptin, and associated functional analysis, structure-function studies of the epidermal growth factor (EGF) receptor complex, and more recently, discovery and analysis of a new class of intracellular cytokine regulatory proteins, the suppressors of cytokine signalling or SOCS proteins.

And on the commercialisation side, there have also been a number of success stories, with four of Amrad's current portfolio of projects coming from the CRC. LIF, although ultimately unsuccessfully in trials as a therapeutic for treatment of neuropathy (nerve pain), is being tested for use in treating infertility problems by Swiss biotech Serono, which obtained worldwide exclusive rights for commercialising LIF for reproductive health applications in 2003, and Phase II trial results are due later this year.

Return on investment

The IL-13 receptor project was the focus of Amrad's recent US$112 million plus royalties deal with Merck to develop asthma therapeutics based on the IL-13R alpha 1 monoclonal antibody, which was developed by Amrad and the CRC using technology licensed from Medarex to humanise the antibody.

"In terms of foreign returns to Australia, the CRC has probably paid itself off in just this one deal," Nicola says.

Two earlier-stage projects at Amrad are also CRC collaborations. The GM-CSF receptor antibody project is being developed in partnership with UK company Cambridge Antibody Technology as a potential treatment for rheumatoid arthritis, and Amrad recently noted that a candidate for clinical trials was about to be selected for advancement into formal pre-clinical studies.

The last project, based on the SOCS proteins, is still in the research phase, with the proteins being evaluated as potential clinical targets for diseases including chronic hepatitis, multiple sclerosis, cancer, growth disorders and muscle wasting diseases, anaemia and obesity.

"To me, this is the main achievement of the CRC," says Flack. "These aren't small companies -- if you want to do a deal with a pharmaceutical company, you can't do better really than Merck. Amrad has a pretty impressive roster of partners and I think they deserve credit for that."

While Amrad has the first rights to take up CRC projects for commercial development, it has not automatically taken up the option, and according to Flack has knocked back projects a few times.

"The CRC has tried to license some of these projects elsewhere and failed, and this goes a long way to justify why Amrad did not take up certain projects," Flack says. But in some cases, such as the EGF project, the interest is still there, he says, just awaiting more data on potential clinical applications.

Nicola and Flack both stress that the achievements of the CRC would not have been possible without the long-term nature of support embodied by the CRC program. Over the years, the CRC has had more than $29 million in Federal funding, $10 million in cash support from Amrad and nearly $82 million in in-kind contributions from its partners.

"I think one of the really troubling things early on was that the CRC secretariat and the government thought that after five or six years of support, the CRCs should be self-sustaining. That might work for some CRC models, but not this one. We had to convince them that we needed longer to get returns," Nicola says. "But even when we could not produce commercial results we were producing quality results, and gaining international recognition of our efforts."

Flack says the time issue associated with developing biopharmaceutical products is something that many people, even those within the industry, don't grasp. "Risk and money are more accepted as concepts and more understood by Australian biotech companies and boards. But everyone thinks it will happen in one, two, three years, they don't think in terms of decades -- and they should," he says.

Many of the CRC's projects are around 10 years old -- some, like LIF, are even older than that. A good example is the SOCS project -- the proteins were first discovered in 1996-97, but they haven't yet been sufficiently validated as targets for clinical development. IL-13R was identified in 1995-96, but it wasn't until 1998 that its potential role in asthma was identified, and the company is only now in the last stages of lead optimisation prior to Merck taking over the formal pre-clinical development.

"Ideally, you need clinical as well as scientific validation," says Flack.

Learning curve

A third aspect of the CRC program is education, and the CRC-CGF has played an important role there as well, in particular through the co-establishment (with the Gene CRC) of the Undergraduate Research Opportunities Program (UROP) which has seen placement of 62 students from the University of Melbourne and other local universities into research labs at one of the CRC member institutions to experience real-life research. A number of UROP students have gone on to graduate degree programs in CRC labs, and the program is set to continue past the conclusion of the CRC under the auspices of Bio21.

Other educational programs have focused on workshops allowing CRC staff to learn new skills and exchange programs allowing institute staff to work in the more commercial environment at Amrad.

In the end, the CRC-CGF will be remembered as a pioneering program that brought together researchers from multiple institutions and with diverse skills to create a targeted research program with enough critical mass to achieve its goals.

"I can't think of another example of a collaboration between academia and industry that has achieved so much," says Amrad CEO Pete Smith. Flack says the CRC-CGF has broken down many of the barriers between research and industry to create a culture of good science going all the way through to good pharmaceutical innovation.

"It's innovation in terms of the way the word should be used. That to me is the greatest achievement," he says. "We're embracing the culture rather than standing off from it."