Profile: Implicit Biosciences

Unlike the classic Australian model of spinning out a biotechnology company from a university discovery, usually with an inventor in tow, Implicit Bioscience has set itself up to do things a little differently, in more sense than one.

Having two people involved in the company of the stature of Emeritus Professor Peter Andrews, Queensland’s chief scientist and well-known researcher and biotech entrepreneur, as well as Professor Ian Frazer, known by readers of The Australian newspaper as “God’s gift to women” for his Gardasil work, is probably one reason why it has managed to gather a group of high net-worth investors to fund its research and development.

Joining these luminaries is Garry Redlich, a co-founder and former CEO of one of Australia’s best biotechs, Peplin, and one of the people responsible for the first ever outlicensing of an Australian cancer drug to the US. Redlich was approached by Andrews and Frazer some years ago with an idea the duo had for adopting a different model of business.

That model was to look for drugs that had already had significantly up-front costs allayed, had shown drugability and safety, but for one reason or another was sitting on the shelf. They would research the drug, and then perhaps re-purpose it.

Andrews has a long background in biochemistry and Frazer is an immunologist, so the idea was to find molecules in the immunology space. “The over-riding theme was, let’s put a team together first and then go looking for something, rather than have it happen opportunistically around a discovery at a university,” Redlich says.

“That’s not an unusual model at all but it is something that is not the classic Australian model, which has generally been a spin-out from individual labs. It is also fortunate that we haven’t had any inventors on board in this current portfolio, which has given us some objectivity when the drug has been re-purposed.”

On board are people like Dr Larry Corey, one of America’s pre-eminent virology researchers who is an authority on HIV and herpes virus. Another is Dick Haiduck, the company’s chief business officer, who worked with Redlich on the outlicensing deal and heads the company’s US office. The company actually operates on a virtual private network (VPN) with daily video and Skype conferences, so distance is not so tyrannical.

Also on the scientific advisory board is Dr Tracie Ramsdale, a founder and former CEO of Alchemia; Professor Istvan Toth, another co-founder of Alchemia and chair in biological chemistry and professor of pharmacy at the University of Queensland; and Dr Doug Williams, an immunologist who played a key role in the discovery and development of Amgen’s arthritis drug Enbrel, and is now the CEO of ZymoGenetics in Seattle.

In February this year, Implicit announced it had bought a monoclonal antibody called IC14 from Eli Lilly. Originally developed as a treatment for severe sepsis, Implicit is now re-purposing it to target acute lung injury (ACI), a silent killer of hundreds of thousands of people each year. IC14 will be added to the other drug in the Implicit portfolio, oglufanide disodium (ODS), an anti-pathogenic compound with a very interesting history.

---PB--- Threat reduction

ODS is an immuno-modulator with a very interesting effect on a range of pathogens, which is probably why it caught the attention of the US Government’s Threat Reduction Agency. Implicit won a contract to develop ODS in September 2007, after it had sat on the shelf for a number of years, Redlich says.

“It was actually developed by the Russians within a military environment,” he says. “It was acquired by a US company in 1991 and was developed extensively against cancer in a number of clinical studies in somewhat controversial doses.

“These were high doses in terms of milligrams, whereas the traditional prescribed Russian usage was in micrograms, and it didn’t distinguish itself in those particular studies. But there were a number of confounding factors and we always believed that the original Russian use in terms of hard to treat infections was the right way.”

This is the direction Implicit has now taken the compound, which doesn’t actually work directly against pathogens but through the immune system. “It has demonstrated some very interesting effects with one particular biowarfare pathogen which causes meliodosis, Burkholderia pseudomallei, which is actually endemic in northern Australia as well as Thailand.

“It’s easily cultured and is a very hardy pathogen and infects by the respiratory route as well as by the skin route, so it is a worrying pathogen in biowarfare. And there’s not a lot that kills it. It is a remarkable bug that actually eats up some antibiotics and it’s not terrifically sensitive to what’s out there.”

Implicit has been able to show some significant results with ODS against the pathogen, which got the US Defense Department interested, he says. They signed a substantial contract that now supports the company’s overheads as well as providing direct funds for research. “It has also given us a chance to develop a skill set in managing government contracts, which we hope to put to good use with IC14,” Redlich says.

---PB--- IC14 for CD14

IC14 was originally developed by the Scripps Institute in association with Johnson & Johnson and Rockefeller University. It was acquired by ICOS, most famous for erectile dysfunction drug Cialis, in the 1990s and was developed against severe sepsis.

However, when another more advanced drug in the ICOS stable, Pafase, spectacularly failed in phase III, at huge cost to the company, ICOS went cold on the sepsis space and IC14 went on the shelf. When Lilly acquired ICOS to buy out its residual rights to Cialis, IC14 came along too.

“This little package ended up on a back shelf in a warehouse, without anyone knowing what it was,” Redlich says. “We were able to find out what it was, and it was quite attractive.”

It was particularly attractive in light of new research which showed that CD14, the protein with an essential large role to play in the innate immune response to bacterial infection, was also very important for lung inflammation, and which is the target of IC14.

CD14 triggers the activation of the immune response to bacterial components such as lipopolysaccharide through the Toll-like receptor pathway. And lung inflammation in response to immune activation through that pathway is a primary factor in the early pathogenesis of ALI, which can rapidly progress to acute respiratory distress syndrome and death. It commonly occurs after acute insults to the body, such as trauma, pneumonia and sepsis.

“Hence the plan for developing it for acute lung injury, which is a silent killer,” Redlich says. The early stage trials for the drug have already been completed in 150 patients, so Implicit is able to take it straight into Phase II in its indication, a move the company hopes to start soon.

“We’ve got to manufacture some drug first, and we are going to be working in acute care, in intensive care units, so that will take some planning. We are hoping to have a couple of sites in Australia. Adelaide is the centre for acute lung injury research here so it is more likely that we’ll have them there, but it hasn’t been decided yet.”

In the meantime, Implicit is working on achieving a liquidity event by 2011 and rewarding its investors. It is also not looking to list. “We have some wealthy investors who have shown faith in the team and have allowed us to go on without having to spend half a million dollars a year reporting to the ASX and watching our share price go up and down at the hands of day traders.

“Obviously we are looking for other opportunities between now and 2011, but we are not trying to build an empire. We are trying to build a company that returns investment cash to the investors. That’s not something that’s been done in the Australian biotech industry and we’d like to be the first to do it.”