Transcript Funding Academic and Nonprofit Institution Early Drug

Funding Academic and Nonprofit
Institution Early Drug Development
Philip Perera M.D., MBA
Funding Early Drug Development
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Traditional Early Development Funding Sources
Trends
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Good News/Bad News
Innovative Funding Models
Development Funding Sources
US $ Billions
Other sources - Federally Funded Research and Development Centers funded by federal agencies and
managed by industry, university, or non-profit operators (e.g. Brookhaven National Laboratory) and NonProfit organizations ( e.g. philanthropy, research Institutes etc) .
Source: Battelle, R&D Magazine 2012
Funding Sources For U.S.
Academic R&D: 1990–2009
60%
20%
13%
7%
Science and Engineering Indicators Digest (2012)
Largest Federal Source of Academic Drug Research Dollars - NIH
NIH ANNUAL BUDGET
•2001-2010
51% Increase ($10.5B)
•2010 -2013
0.003% Decrease ($82M)
http://officeofbudget.od.nih.gov
Fiscal Year
Appropriated
2001
20,458,130,000
2002
23,296,382,000
2003
27,066,782,000
2004
27,887,512,000
2005
28,495,157,000
2006
28,461,417,000
2007
29,030,004,000
2008
29,312,311,000
2009
30,545,098,000
2010
30,934,413,000
2011
30,935,000,000
2012
30,852,187,000
2013 Proposed
30,852,187,000
Federal Funding For Early Drug Development
2012 NIH Total Program Level ($30.85B)
$8 of every $10
appropriated to
NIH flows out
to the scientific
community at
large.
Research ($3.036)
Centers
9%
Research Project Grants
53%
($16.909)
Research Training
2% ($794M)
R&D Contracts
11% ( $3.545)
Intramural Research
11%
($3.036)
All Other
3% ($963M)
FY 2012 NIH Budget Roll-out Francis S. Collins, M.D., Ph.D
Other Research
6% ($1.82)
Res. Mgmt. & Support
5% ($1.538)
Federal Funding For Early Drug Development
Federal Funding Trends
 As the service expenditure on the national debt increases
what will happen to government funds for R&D?
 NIH - Fewer grants are being funded
 Appropriated funds for already funded projects are being
reduced
 Bright Spot - NIH has prioritized funding for new
researchers submitting first-time grant proposals
 This helps to effectively level the playing field with
established scientists
Federal Funding For Early Drug Development
Funding Trends
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NINDS –Brighter Picture for FY 2012
 Continues to be a significant source of basic drug
research for neurologic disorders
 Since 2001 - $614M increase in approved budget
 In FY 2012 - 2,656 Research Project Grant (RPG) will be
awarded
 Noncompeting Research Project Grants will increase
by 137 awards and increase by $46.6 million.
 Competing RPGs will decrease the number of awards
by 45 and decrease funding by $10.1 million.
http://www.ninds.nih.gov/funding/
Federal Funding For Early Drug Development
NINDS Distribution Of Funds By Mechanism
2011 vs. 2012
Overall RPG
+$22.4 million,
total $1.315B
$8.50 of every $10
appropriated to
NINDS flows out to
the scientific
community
- 1.6%
+$1.9 million, total
$32.7M
NINDS 2012 Proposed Budget $1,664,253,000
http://www.ninds.nih.gov/funding/
Discovery and Development Funding
Requirements
Lead Optimization
Early non-GLP and GLP animal safety
tox, pilot manufacturing, preclinical
ADME etc
Target ID and Validation, Assay
development for HTS, HTS, Library
Development, Lead ID
$2M-25M*
$10M-25M*
$30M->100M
Potential Academic
Growth Area
Industry Dominated Research
*Costs of discovery and early development are highly variable – #targets, # leads, #optimized leads
Nature Reviews Drug Discovery
,
10
409-410
(June 2011) | doi:10.1038/nrd3462
Academic Drug Discovery Center Capabilities
Survey
Response Rates
78 Universities
or Non-profit
Research
Organizations
Engaged in
Small Molecule
Research
45%
Psychiatric and
Neurodegeneration
29%
Stroke and
Neuromuscular
36%
Orphan Diseases
Frye S et al US academic drug discovery Nature Reviews Drug Discovery 10, 409-410 (June 2011)
Federal Funding For
Drug Discovery and Early Development
Filling In The Gap - Blueprint Neurotherapeutics Network Funding
http://www.neuroscienceblueprint.nih.gov/bpdrugs/index.htm
Non-governmental Funded Early Drug
Development
Non-governmental Funding Trends
Industry Trend – More Industry R&D funding to academia and nonprofits
 98% of $280B US 2012 R&D funding stays internal - either directly or
through outsourcing with other industry performers*
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“Big 20” global drug companies spent $96B in R&D in 2010 (roughly 15% or so of
drug sales)**
A shift has begun
 Academia
 2012 - anticipated large increase (26.5%) in the level of all industrial
R&D funds to academia
 This amounts to an increase of $800 million for a total of $3.9 billion
R&D funding to academia in 2012
 Non-profit
 8.9% increase from 2011 to 2012 is forecast for industry funding to
non-profit research institutes, amounting to a total of $2.1 billion
*R&D Magazine December 2011
**Capital IQ
Non-governmental Funded Early Drug
Development
Non-government Funding Trends -Pharma
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Large and midsize Pharma are lowering their cost structure
 Pfizer recently announced that it plans to reduce its overall
R&D budget to $6.5 billion in 2012 (down from $9.4 billion in
2010)
 GSK eliminated a major portion of their CNS Discovery/Early
development group
“This is a business model where you are guaranteed to lose your entire book of business every 10 to
12 years”. J.P Garnier, former CEO of GlaxoSmithKline
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Potential Early Drug Development Partners ( Pharma, Venture
Capital etc) becoming increasingly risk averse as sources of capital
shrink
How will Pharma replace R&D infrastructure and expertise and deal with
expiring blockbusters and pipeline failures?
Non-governmental Funded Early Drug
Development
New collaborative business models will dictate future success
Pharmaceutical Shared-Risk Programs
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Eli Lilly has moved away from a fully integrated pharmaceutical
company to a “fully integrated pharmaceutical network model
 Leverage the expertise of multiple sectors (academia,
government research institutes), thus reducing costs,
increasing probability of success, and sharing risk
Created an opportunity for academic and nonprofit funding
Non-governmental Funded Early Drug
Development
Pharmaceutical Shared Risk Programs
Eli Lilly – Open Innovation Drug Discovery
Phenotypic Drug Discovery Program
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Drug discovery entities (e.g., academic institutions and individual
faculty) submit a molecule into their phenotypic drug screening
panels in a confidential manner
A hit triggers a secondary, more target-based screening
After the full set of five panels is completed, a report is sent to the
investigator
The investigator retains the intellectual property
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Lilly has the first right of negotiation for a commercial opportunity on
that particular hit for a defined period of time after the screen is
completed.
Entity may request additional research funding
Innovative Non-governmental Funding Models
Venture Philanthropy
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Marriage of charitable giving with the principles of venture
investing to accelerate drug discovery research
Recipients -held to the same rigorous standards as if they
were receiving money from a for-profit organization
Research Focus – identify viable drug targets with commercial
potential
Expectation - ROI that goes back into other research grants
Venture Philanthropy
Michael J. Fox Foundation for Parkinson’s Research
4 step targeted approach to research funding
Charting The Course
PD specialists determine the research areas that hold the
most promise and determine funding directions.
The Selection Process
The scientific staff and expert advisors review
proposals from researchers and proactively go
after promising research
Venture Philanthropy
Michael J. Fox Foundation for Parkinson’s Research
The Research Process
Eliminate red tape & get funding to scientists as quickly as two
months. Staff & Advisors remain involved as research,
milestones are established and outcomes evaluated
progress.
Capitalizing On The results
Help find partners to further development
Between 2000 and 2010, the Foundation funded more than $264 million in
Parkinson's research, either directly or through partnerships
Innovative Non-governmental Funding Models
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Not For Profit Pharmaceutical Company
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Institute For Oneworld Health (IOWH) - seed funding from
Bill and Melinda Gates Foundation
 Childhood Malaria, HIV AIDS, developing countries
Cystic Fibrosis Foundation Therapeutics, Inc. (CFFT)
 Wholly owned, nonprofit drug discovery and
development subsidiary of the Cystic Fibrosis Foundation
Gladstone Institutes and the Taube-Koret Center
 Nonprofit biotechnology incubator
 Neurodegenerative Disorders Research
Innovative Non-governmental Funding Models
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Nonprofit Pharmaceutical Company
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Philanthropic seed funding required
Profit requirement not part of the business plan
There are no shareholders or returns to be paid
The company cannot be bought, merged, or acquired
The company is expected to become self sustaining
Ideal mechanism for research Institutes to monetize their IP
assets
Other Sources Of Funding
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Patient Advocacy Groups
 Always supportive and generous
 As donations shrink less money available for innovation
grants from philanthropic organizations
High Wealth Individuals - 397 Billionaires in the US*
 Sergei Brinn - Parkinson’s Disease
 Larry Ruvo Family - The Lou Ruvo Center for Brain Health
 The Pritzker Family - The Pritzker School of Medicine Chicago
 Mark Zuckerberg?
*Forbes 2012
Future Funding Challenges
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Academic Institutions and other non-profit R&D Institutes will
play a larger role in future early stage drug development
 “De-risking” translational research for industry
 Additional funding resources are needed
 to build out “valley of death” gap infrastructure
 to move optimized leads towards the clinic
 to attract late stage partners
 to monetize IP
 to become self sustaining and grow
Future Funding Challenges
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Collaboration with industry and other venture funding
resources offer significant potential for new funding
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Will require data sharing between all parties and issues related to IP
ownership will need to be resolved
Publish and perish - IP protection vs. desire/need to publish
Federally Funded research grants will continue to be the major
source of academic R&D funding
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“The squeaky wheel gets the grease” If we don’t advocate for our
patients shrinking funding will go elsewhere
Andrew Carnegie (1835-1919)
“He who dies rich dies disgraced”.
John D Rockefeller (1839-1937)
“Gain all you can, save all you can, and give all you can’”
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BACK UP
NIH R01-Equivalent grants
Applications, Awards, and Success Rates
Source: NIH IMPAC, Success Rate File
Federal Funding For
Drug Discovery and Early Development
Blueprint “Virtual Pharma” Model
Current Programs
ALS
Stroke
Alzheimer’s
Depression
Optic Neuropathy
Hearing Loss
Macular
Degeneration
http://www.neuroscienceblueprint.nih.gov/bpdrugs/index.htm
Nonprofit Pharmaceutical Company
Biotech Incubator
Collaboration Between Academia and Philanthropists To
Find Effective Therapies For Neurodegenerative Diseases
Steven Finkbeiner Nature Medicine 2010
Venture Philanthropy
Alzheimer’s Drug Discovery Foundation (ADDF)
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In 1998, the Estée Lauder family established the Institute for
the Study of Aging (ISOA), a private foundation, using a venture
philanthropy model.
The Alzheimer’s Drug Discovery Foundation (ADDF) is an
outgrowth of the ISOA and creates the opportunity for likeminded philanthropists to participate in research for
Alzheimer’s and related dementias
Seed Money
 To date, the ADDF has granted more than $50 million to
fund over 340 Alzheimer’s drug discovery programs and
clinical trials in academic centers and biotechnology
companies in 198 countries.
Venture Philanthropy
MODEL
Academic/Not
For Profit
Institution
*VC and VP
Under One
Roof
Venture
Philanthropy
Organization
Other Possible
Research Partners
(collaborative
programs)
Hands-on/off
engagement &
financial support
Build Capacity to
Increase Research
Output
& Fund New Drug
Development
Projects
*Identify potential industry partners,
and other funding and commercial
opportunities other business support
e.g. IP assistance