Executive Spotlight: Dr. Alain Baron, President and CEO, Elcelyx Therapeutics

Dr. Alain Baron

Elcelyx Therapeutics is a privately held biotechnology company focused on creating a wide range of products based on the science of nutrient sensing. The company’s novel product candidates are directed at the prevention and treatment of obesity and diabetes. Since joining Elcelyx Therapeutics in 2010, Baron has been focused on advancing the company’s new products to treat metabolic diseases based on a completely novel platform, called “gut sensory modulation.” He brought his expertise as an entrepreneur-in-residence and a member of the life science team at Morgenthaler Ventures, a position he has held since 2008, along with prior experience as senior vice president of research at Amylin Pharmaceuticals. He has held faculty positions at Indiana University School of Medicine in Indianapolis and UCSD, along with the Veterans Administration Medical Center in San Diego. Baron graduated from McGill University in Canada with a bachelor’s degree in biology and a medical degree from the Medical College of Georgia Augusta. He completed postdoctoral studies at UCSD.



Q: Share with us a brief history of the company. How did your leaders come together? How was the company originally funded?


A: Elcelyx was founded by two former Amylin Pharmaceuticals employees, myself and Martin Brown. Elcelyx was first funded by Morgenthaler Ventures in a Series A round in March of 2010. Currently, the company is funded by Morgenthaler Ventures, Kleiner Perkins Caufield & Byers, and Technology Partners.


Q: Tell me some of your biggest goals for the year.


A: Elcelyx is developing new products to treat metabolic diseases based on a completely novel platform, named “gut sensory modulation,” that shows promise to produce very safe and effective oral therapies.


Q: What are the biggest challenges to achieving these goals?


A: Recognizing the importance of safety of therapeutics for metabolic diseases in the current regulatory environment, Elcelyx has focused its efforts at maximizing safety in its development of novel therapeutics.


Q: If you could change a public policy at the state or federal level, what would it be?


A: Given the time and risks involved with drug development, there is a great need to improve dialogue with the U.S. Food and Drug Administration to make their decisions more predictable.


Q: What is the most rewarding part of your job?


A: The collaborative environment created and nurtured at Elcelyx makes for a very productive and enjoyable workplace. Knowing we are working to address large, unmet medical needs is all the more rewarding.


Q: What are you doing when you’re not at work?


A: I love to spend time with my family and friends, read, play tennis and travel.

CHI-Advancing California biomedical research and innovation

Event Spotlight: CHI Hosts Annual Reception and Hill Meetings in Washington, D.C.



House Energy & Commerce Committee Chairman Fred Upton accepts CHI Chairman's Award from CHI President and CEO David Gollaher, Ph.D., and CHI Chairman and Gen-Probe CEO Carl Hull.

CHI honored House Energy and Commerce Committee Chairman Fred Upton (R-MI) with the CHI Chairman’s Award during a reception May 9 in Washington, D.C., at the Folger Shakespeare Library. Guests at the reception and private dinner enjoyed an evening with the California delegation and leaders driving biomedical innovation at the event, called “Invest. Innovate. Compete.” During the dinner, Rep. Brian Bilbray (R-San Diego) expressed his support for the biomedical community and stressed the importance of bringing life-saving cures to patients in need.

Prior to the event, CHI board members participated in meetings on Capitol Hill to discuss the impact of the U.S. Food and Drug Administration and user fee reauthorizations, the importance of National Institutes of Health funding, and the significance of the California life sciences community to continued innovation and job creation. Meetings were held with Energy and Commerce Committee members including: Rep. Brian Bilbray (R-Carlsbad), Rep. Lois Capps (D-Santa Barbara), Rep. Anna Eshoo (D-Atherton), Rep. Phil Gingrey (R-GA), and Rep. Mike Rogers (R-MI). Other member meetings included Sen. Barbara Boxer (D-CA), Rep. David Dreier (R-San Dimas), Rep. Jackie Speier (D-Hillsborough), House Majority Whip Kevin McCarthy (R-Bakersfield) and key legislative staff at the Senate Health, Labor, Education and Pensions (HELP) Committee. Over the course of the day, one message was repeatedly conveyed: the important and successful role of CHI in communicating and contextualizing the importance of consistent, predictable and efficient FDA regulatory processes to continued biomedical research, investment and innovation in our state.

Also that day, CHI released a report on FDA with respect to the agency’s approval of drugs and biologics, building on our earlier study, Competitiveness and Regulation: The FDA and the Future of America’s Biomedical Industry (2011). The report, Managing Priorities: Therapeutic Area Variation in FDA Drug Regulation, presents new data that illustrate important differences in FDA performance from one therapeutic area to another and examines misalignment between regulation and public health needs. It comes as Congress considers critical legislation that would renew and expand fees paid by drug and medical-device companies to help fund the FDA. Current legislation allowing the FDA to collect fees from drug and medical-device companies expires Sept. 30.

Genetic Engineering and Biotechnology News highlighted the report’s findings in a recent article and The Burrill Report featured a one-on-one interview between CHI CEO David L. Gollaher, Ph.D., and Burrill’s Daniel Levine.

CHI-Advancing California biomedical research and innovation

Executive Spotlight: Kleanthis Xanthopoulos, Ph.D., CEO of Regulus Therapeutics Inc.



Kleanthis Xanthopoulos

Xanthopoulos understands the biotech business from the inside out. Xanthopoulos is president and CEO of Regulus Therapeutics Inc., which was formed in late 2007 by Alnylam Pharmaceuticals of Cambridge, Mass. and Carlsbad, Calif.-based Isis Pharmaceuticals. It is testing drugs that use microRNA technology, a gene “silencing” technique used for treating various diseases. Regulus has created leading strategic alliances with GlaxoSmithKline and Sanofi-Aventis to develop microRNA therapeutics. Regulus moved to La Jolla in mid-2010 in the proximity of leading academic institutions including The Scripps Research Institute, Salk Institute, Sanford-Burnham Medical Research Institute and UC San Diego.

Before joining Regulus, Xanthopoulos spent time as managing director of Enterprise Partners Venture Capital, where he analyzed the best deals in the biomedical space. Prior to that, he co-founded and served as president and CEO of Anadys Pharmaceuticals, Inc., and served as a member of the board until its acquisition by Roche in late 2011. And before Aurora Biosciences became Vertex Pharmaceuticals, he was vice president from 1997 to 2000. Xanthopoulos participated in The Human Genome Project as a section head of the National Human Genome Research Institute from 1995 to 1997. Previously, he was an associate professor at the Karolinska Institute in Stockholm, Sweden after completing a postdoctoral research fellowship at The Rockefeller University, New York.

An Onassis Foundation scholar, Xanthopoulos received his bachelor’s degree in biology with honors from Aristotle University of Thessaloniki, Greece, and received both his master’s and doctorate degrees in microbiology from the University of Stockholm, Sweden.


Q: You went from being head of a biotech to the investor world, and, now, as head of this company spun out of Alnylam and Isis. What has the transition back been like?


A: Entering biotech life again was a perfectly natural transition, like coming home. I fell in love with the groundbreaking biology and was enamored with the opportunity to translate this big idea into innovative medicines. I like to say that my time spent at the VC firm was as a biotech sabbatical — taking time off from my true passion of building companies.


Q: What led Regulus to locate on the Torrey Pines Mesa as opposed to, say, Carlsbad where Isis is located?


A: It made terrific sense to be incubated within Isis. There is a lot of educational knowledge that we extracted from Isis, and the best way to do this is by osmosis. So, being there was very important for the first years of Regulus’ life. But, ultimately, we wanted our own culture and identity, and we felt that, based on some local collaborations and activities that we have, it would be much better served if we were in the Torrey Mesa as opposed to North County.


Q: Regulus has made some major industry collaborations, big names such as GlaxoSmithKline. What can we expect from the Regulus partnerships in the years to come?


A: Regulus has a dominant locked-in position in the world of microRNAs, which are remarkable and elaborate. They manage control of transcription and post-transcription mechanisms by dictating the half-life of messenger RNA. More than 700 microRNAs have so far been identified in humans, so that means 700 targets. And that, for a small company like us, means collaboration. We have 40 active academic institutions that work with Regulus and many of them are in very close proximity, including one with UCSD. It is part of the strategy and one that we pursued and have benefitted from exceptionally well.


Within six months of formally announcing Regulus, we had the partnership with Glaxo. It is encompassed around four microRNAs. Only one had been identified before the collaboration. So what you should expect is steady stream of news over the period of the collaboration.


Q: Talk about the environment for startups in California. What would be your advice to start-ups looking to grow within the state, such as Regulus has?


A: The good news is that any good, solid idea that is addressing significant needs in the pharmaceutical drug development stage is going to get funded. The bad news is the other ideas, or maybe product ideas alone, have a much more difficult time. Re-licensed or repurposed drug stories, I think, are going to have a harder time moving forward. In the early part of this year, we have seen a resurgence of platform technology stories emerge successful on the biotech scene. These platform stories are getting attention from not only VC firms, but institutional investors looking to take additional risks in their portfolio. This is a departure from the past several years in which companies with later-stage assets were the only investment opportunities for institutional investors. The tide seems to have turned and the early platform companies are now vying for the same Wall Street monies as the later-stage companies. A truly innovative breakthrough idea, such as the one Regulus is pursuing, will get funded.

Q: When Regulus first began, the CEO of Alnylam told investors that he expected Regulus to "dominate the microRNA space.” How do you think Regulus has stood up to that test?


A: Unfortunately, we did better than expected. And by unfortunately, I mean, we have scared away a lot of competition. Many people think that is good. I, personally, think that a little bit of competition is very healthy. So, unfortunately, we don’t have that, so the case of microRNA almost exclusively relies on how good Regulus is going to do.


Q: That has also brought you some healthy collaborations and financial backing. Talk about your growth as a company and where you see yourselves going in the next five to 10 years.


A: The biggest risk for Regulus five years ago was, “Can you target microRNAs and have a sort of peak effect without having a lot of side effects?” That was the big biological risk. Today, we have been able to show in 25 different models of human studies and animal studies that you can do that with a good therapeutic model. So, now you can say that the proof of concept has been established.


So, how do we look five years from now? We are very likely going to be a public company. We are still going to be less than 100 people. We are religiously defending our turf when we can, maintaining that the best brain trust one can possibly have in-house, but also utilizing a lot of extra hands outside. We going to have at least three programs in the clinic and maintain four to six preclinical programs at any given time.

Q: What are some of your proudest accomplishments since Regulus was formed in September 2007?


A: For me, it is all about people, strategy and finance. I think we have been, so far, good on all three fronts, and that’s something I am proud about. We have brilliant people, who are all tremendously seasoned drug hunters or hugely experienced people in finance and operations. We are now at about 55 employees. We are one of the few companies that has been growing at significant rates over the past four years. We have raised over $110 million. The vast majority of this is from the alliances, so it is non-dilutive financing. And I think we have a very good strategy of how to methodically move the pipeline from a big idea to a meaningful set of preclinical and clinical progress.




CHI-Advancing California biomedical research and innovation

Executive Profile: Brian O'Callaghan, President and CEO, Sangart



Brian O'Callaghan

O'Callaghan joined Sangart as president and CEO in June 2008. He brings a breadth of experience to Sangart, having held senior positions with a number of pharmaceutical and biotechnology companies in both Europe and the U.S. These include senior positions with Pfizer in the U.K. and Merck Serono in Germany, before becoming president and CEO of BioPartners, a Swiss-based biotechnology company. Since relocating to the U.S., O'Callaghan has held senior management positions at Novartis, Covance, and, most recently, NPS Pharmaceuticals, where he served as chief commercial officer. O'Callaghan brings his extensive experience to lead Sangart through regulatory submission and commercial launch of the MP4 platform.

Q: In looking at the history of Sangart in San Diego, it was interesting to me that you have both these civilian and military applications. Tell me more about Sangart's connection with the Letterman Army Institute of Research.

A: The company was founded by a guy named Dr. Bob Winslow. Bob started this journey when he was with the Letterman Army Institute of Research about 20-30 years ago. His experience there culminated in him founding Sangart about 14 years ago.

What is great is that some of the people still with Sangart today were with Bob at the Letterman Army Institute of Research. Literally decades of research has gone into developing what became MP4, which is Sangart’s platform product.


What Bob discovered was that you could replicate a low-volume setting for some of the properties of blood. As a result, Bob developed the MP4 molecule as an agent that could very effectively transmit gases into the body.


There are the two gases that Sangart is currently focusing on with MP4: oxygen and carbon monoxide.


The oxygenated compound (MP4OX) is designed to deliver oxygen in the capillaries, where red blood cells may not naturally reach, when the body is suffering from hemorrhagic shock. The carbon monoxide formulation (MP4CO) is designed to deliver therapeutic levels of carbon monoxide to patients with sickle cell anemia.


Q: How does this compare to standard care available today?


A: There is no real treatment right now for trauma-related ischemia. When patients suffer blood loss due to a traumatic event, they eventually get to a critical care setting. They get all sorts of fluids, including blood, as well as surgery, of course. If the lactic acid levels, which are routinely measured, show lactic acidosis, an indicator of a lack of oxygen, then they receive MP4OX, in a blind setting, as an addition to standard of care. We measure the resolution of lactic acidosis, which indicates the delivery of oxygen to the ischemic tissue. We also look at other endpoints, such as the ICU setting to see if they are spending less time in the hospital on ventilators, etc.


Our Phase IIb study is evaluating MP4OX plus standard of care in trauma patients, with lactic acidosis due to hemorrhagic shock. It’s running in about 50 sites in about 15 countries throughout the world.


Q: How do you balance the need to raise capital with everyday activities?


A: We have been insulated more than most from all that is going on in the last two to three years because our investors are very patient.


We are funded through to our next major milestone events. Those being the generation of the next rounds of clinical data from the PhIIb study for MP4OX and the PhIb study for MP4CO.


With positive data from our two clinical trials, we are confident of raising additional funding from existing or alternative investors.


Q: Where do the biggest opportunities lie?

A: The biggest opportunity, by far, is in trauma. You can take oncology and cardiology and the other major killers, and you can combine all the deaths that come from those and they don't compare to trauma. Trauma is, by far, the biggest killer in our society.

The good news is that if you do get into a critical care setting, your chances of survival are actually very high. This product will be serving a critical unmet medical need where there are not any products like it out there. The market is estimated to be about $6 billion in the developed worlds at least.

When you look at the pharmacoeconomic aspects of keeping people out of ICU and off ventilators, while also getting them out of the hospital faster, you are potentially saving thousands of dollars per day by using MP4OX. We are estimating savings of anywhere between $5,000 to $10,000 a day, while also contributing to patients being discharged, on average, a week earlier.

Q: What does the future of traumatic brain injury and other types of severe blood loss treatment look like 20 years from now?

A: Traumatic brain injury is one of the things the Army wants us to look at. Traumatic brain injury might have more of a relevance to the military in the battlefield than the civilian setting. What they are looking for are newer formulations that are more robust to be used in the battlefields. So they are looking for formulations that can basically be used in the soldiers' backpacks or in forward positioned surgical units.

Q: What differentiates Sangart from others in the field?

A: Studies show that our MP4 products can potentially be safer and more effective as therapies for trauma and sickle cell disease. We have investors who are very patient and willing to continue investing in us given our strong clinical data. Finally, and very importantly, we are willing to do our development overseas rather than the U.S. should it serve MP4’s needs.



CHI-Advancing California biomedical research and innovation

Executive Profile: Rob Perez, Executive Vice President and Chief Operating Officer, Cubist Pharmaceuticals

Rob Perez

Perez has served as executive vice president and chief operating officer of Cubist since August 2007.

He grew up in the Los Angeles area and received his undergraduate degree from California State University at Los Angeles and his MBA from the Anderson School at UCLA. He began his career as a sales representative in South Central Los Angeles working for Zeneca Pharmaceuticals. Ultimately, he became a regional business director, responsible for sales, marketing and national accounts for the western regional business unit.


After Zeneca, he joined Biogen, in 1995, where he worked with the team that developed a commercial model for Biogen’s first product, Avonex for multiple sclerosis. He eventually led the U.S. neurology business before leaving to join Cubist. At Cubist, he says, they saw a potential in Cubicin that no one else saw.


“I have always worked at companies that have had to compete against larger firms with more resources, so the hallmark of all the businesses that we’ve built has been our ability to learn quickly,” Perez said. “I try to find people and develop processes that allow our team to gain a competitive advantage by listening to those closest to the customer, and by then making incremental changes to the business based on this feedback.”


Q: Share with me a brief history of Cubist Pharmaceuticals and some of the important milestones of the company.


A: The company was founded in 1992, and, in the fall of 1996, Cubist completed its initial public offering. To date, Cubicin (daptomycin for injection) has been used to treat more than a million patients and Cubist is well on its way to surpassing $1 billion in U.S. annual net revenues.


The history of Cubist is a great story that is really about the people who have collectively advanced the science and the business to where we are today, a successful pharmaceutical company. At Cubist we don’t fear failure and that is a large part of what has made us successful. Our culture is one that rewards success, but, at the same time, we view failure as an opportunity to learn. The best example of this at Cubist was the “rescuing” of daptomycin after the Phase 3 results from community-acquired pneumonia were known. Daptomycin failed to meet statistical noninferiority criteria in a clinical trial for severe community-acquired pneumonia. We needed to understand why it did not work in the lungs and we launched an effort to isolate the effect. We discovered the reason and published the results. We ended up with a drug approved in the U.S. for complicated skin and skin structure infections in 2003, and, three years later, received an expanded U.S. label for Cubicin for the treatment of S. aureus bloodstream infections (bacteremia), including right-sided infective endocarditis caused by MRSA and MSSA.


More recently, 2011 was a transformational year for Cubist with positive Phase 2 results for two of our antibiotic candidates, propelling them into Phase 3 — one program already enrolling patients and the other expected to start this year. Also in 2011, we partnered with Optimer Pharmaceuticals to co-promote their therapy, Dificid, for the treatment of clostridium-dificile associated diarrhea (CDAD). We capped off the year with a business development deal to acquire Adolor Corporation, adding a new U.S. commercial product in Entereg and a promising pipeline candidate in CB-5945, also on a path to begin Phase 3 trials in 2012.


Q: What are some of your biggest goals for the upcoming year?


A: The transformational year I just mentioned has put a lot on our plate for 2012. We are going to be focused on executing our business plan aimed at continued momentum in Cubicin sales and putting more marketing muscle behind our newly acquired drug Entereg toward our goal of achieving peak annual sales of $100 million. Also, our sales force will continue to co-promote Dificid as part of our strategic partnership with Optimer.


In the clinic, we expect to have three Phase 3 programs up and running this year. There is a great and growing unmet medical need for antibiotics to treat serious infections, and two of the three programs are focused on antibiotics. The third program we acquired through the Adolor acquisition focuses on a therapy to treat a gastrointestinal side effect of opioid pain management.


Q: What are the biggest challenges facing developers of novel antibiotics today?


A: The challenges we face today started appearing on the horizon several years ago. Despite the remarkable public health success of anti-infective agents, there is a trend toward increasing numbers of bacterial infections that exhibit resistance to new and standard antimicrobials, with 70 percent of hospital-acquired infections caused by bacteria that are resistant to at least one antimicrobial. At the same time, many pharmaceutical companies have backed away from research and development of new antimicrobials because of increased incentives to develop drugs in other therapeutic areas and because of contradicting market forces within the antimicrobial marketplace. As a consequence, anti-infective research has virtually dried up, leaving very few new anti-infective agents in the near term. Cubist is one of the few companies with a promising pipeline in this area. Some public health leaders have identified the challenge and are prompting government action. Now is the time to identify and implement appropriate incentives that will drive antimicrobial research and development.


Recommended incentives have recently been manifested in the Generating Antibiotic Incentives Now (GAIN) Act, which has now been introduced in both the Senate and the House. Dr. Barry Eisenstein, senior vice president of scientific affairs for Cubist, was invited to testify at a congressional subcommittee hearing on the topic. The bi-partisan legislation calls for the enactment of specific economic and market incentives to entice pharmaceutical companies to develop new antibiotics to treat the growing number of serious infections caused by multi drug-resistant (MDR) bacteria. For example, the legislation’s provision for extending the exclusivity granted to some badly needed antibiotics is designed to have the same impact on antibiotic R&D as the Orphan Drug Act had on drugs to treat rare diseases, which now enjoy a healthy pipeline. CHI recently released a report on the subject, available here.


Another challenge that we are working through with others in industry is clear guidance from FDA in defining new regulatory approaches to facilitate antimicrobial development and approval. Recent meetings on this front have been promising, and we look forward to working closely with FDA to ensure more therapies are approved for patients battling sometimes life-threatening infectious diseases. More on this topic can be found at a website sponsored by Cubist: http://www.battlingsuperbugs.com/


Q: What is the most rewarding part of developing products that address unmet medical needs in the acute care environment?


A: We know that Cubicin has been used to treat more than a million patients and we know that if our pipeline of much needed therapies is someday approved, millions more could benefit from much needed therapies. We use the term patients, but these are people who are moms and dads, children, friends, colleagues, and neighbors. Everyone at Cubist comes to work each and every day with the goal of contributing to the advancement of therapies and leaves at the end of the day knowing that somewhere that day Cubist made a difference in someone’s life.


Q: When you’re not working, where do you like to spend your time?


A: I have three great passions outside of work. First and foremost is my family. My wife and I take such great pleasure in watching our kids’ many interests/activities. Second, I enjoy spending time trying to make a difference in the lives of kids who don’t have the educational opportunities that my kids have been blessed with. Finally, my one vice is basketball. I am admittedly a “hoop junkie.” I play with friends whenever I can (although at my age it is not really basketball, but something closely resembling the sport that I love) and also avidly follow the Lakers, and UCLA basketball. There are a lot of demands on my time, but setting priorities helps me maintain a healthy balance in life. For our corporate intranet I publish a blog sharing musings about the business/industry and observations from a personal perspective — I repurpose part of my blog posts on my twitter account @robperez32.




CHI-Advancing California biomedical research and innovation

Executive Spotlight: Jeff Dunn, President and CEO, SI-Bone

Jeff Dunn

SI-BONE Inc. of San Jose, Calif. is the leading sacroiliac (SI) joint medical device company dedicated to the development of tools and products for diagnosing and treating patients with low back issues related to SI joint pathology. The company has developed, and is manufacturing and marketing, less invasive approaches using implants for the treatment of SI joint disorders.

Dunn has more than 30 years of executive experience, including serving as the CEO of six other companies. He has taken one company public, sold all the others to larger public companies, served on numerous boards of directors and is an advisor to other CEOs. Prior to SI-BONE Inc., Dunn was CEO of INBONE Technologies, which he built into a leading ankle replacement and small bone fusion medical device company. Dunn led the sale of INBONE to Wright Medical in April 2008. He holds a bachelor’s degree from Colgate University and a master’s of business administration from Babson College.

Q: How did SI-BONE form?

A: It was Dr. Mark Reiley, who founded Kyphon and invented kyphoplasty (a procedure that attempts to stop the pain caused by spinal bone fractures) with whom I got together about six years ago when I became the CEO of two of Mark’s companies. One was an ankle replacement company and one was a small bone fusion company. One company was in Colorado; one was in Berkeley, Calif., and I was the CEO of both of those at the same time. We merged those companies into a company called INBONE Technologies, which was acquired by Wright Medical Group in April 2008. Wright Medical is not in the spine business, so, as part of the deal, we took all the assets related to SI-BONE — the patents, the 510(k)s, etc. — and we spun that company out into an independent company.

For the next seven or eight months, we had no employees; it was just Mark and I. On Nov. 26, 2008, we received 510(k) clearance from the FDA. We then raised private money, about $4.5 million from friends and family. We hired our first employee in April 2009 and basically spent that year setting up manufacturing, quality systems, setting up the training programs for the surgeons, doing work around the diagnosis and finding the diagnostic algorithms to teach surgeons how to diagnose SI joint pain.

We have trained more than 700 surgeons to date. We did our very first surgery in June of 2009. We have grown as a company approximately 50 percent every single quarter, quarter over quarter, since June 2009.

Q: I also saw that you recently raised some venture funding.

A: We raised $16 million from Montreux Equity Partners and also Skyline Ventures. Our very first venture money came in last summer from Skyline, and then we had a bunch of private investors also participate who were friends of Mark’s and mine that have made money with us before.

Q: Talk a little bit about this type of surgery and the market SI-Bone is addressing.

A: There is $50 billion a year spent on lower back pain in the United States. Clinical studies show that 22 percent of that is related to the SI joint. The only surgery to treat the SI joint over the last number of decades is an open surgery where the patient endures a 12-inch incision. It is very bad for the patient, obviously. Ours is a minimally invasive surgery. It takes about an hour. So, we are treating something that almost has never been treated, but accounts for 22 percent of all lower back pain. As you probably know, the No. 1 reason that people visit their physician is for the flu. The second most important reason is back pain. So, it is a huge problem, and we are addressing an underserved, unmet need that afflicts millions of patients.


Q: How does the company stand out in the competitive landscape for minimally invasive surgery and surgery like yours?

A: Well, in the United States, there is only one very small company and one medium sized private company which have introduced products to compete with us. Let’s just say we have 95-plus percent market share. In Europe, there is one other competitor. We believe in our product. It is significantly better, easier to use for surgeons, better for the patient.
The key, though, is to educate the surgeons on how to diagnose this thing. We believe that everything is about patient selection because many people with lower back pain have an under-diagnoses. We spend a tremendous amount of money on educating surgeons, physician assistants, physical therapists, etc. about how to effectively diagnose these patients.


Q: Are you seeing patients that have gone through fusions or other surgeries come to you afterward? Are these new patients?

A: We have plenty of patients that are both de novo, who have been
diagnosed with sacroiliac joint issues or dysfunction, and previous spine fusion patients.

In the United States, there are hundreds of thousands of lumbar fusions each year. Literature shows that about 75 percent of all patients that have lumbar fusions develop adjacent segment disorder within five years. So, if you fuse a part of the lumbar spine, typically it affects other pieces of the orthopedic anatomy. The majority of people who have those kinds of surgeries within five years will have some kind of SI joint issues.

Q: You touched on this a little bit, but what does the reimbursement landscape look like for your device?

A: Our reimbursement rates are typically running about 94 percent. So, the reimbursement is actually quite reasonable. But, of course, as we get bigger as a company, the payers, i.e. the insurance companies and Medicare and the key medical societies including NASS, AAOS, CNS, AANS, ISAAS, ISIS and the AMA, are going to want to see efficacy, economic justification and safety data, so that is why we are investing so much in clinical studies. We are launching multiple studies.

Q: What else is good to know about SI-BONE?

A: What I am most proud of is we have hired 100 people in the last two years and we just have a tremendously talented group of people that are working together to help these patients. They are thriving as I am on the patients. What’s more fun than helping patients? Additionally, we have an advisory board made up of brilliant medical professionals like Dr. Steve Garfin, Dr. Frank Phillips, Dr. Paul Anderson and others. I would go out on a limb and say that our advisory board is among the most talented and respected spine advisory board in the United States.

So, we have a very good group of people that are trying to solve this problem and help educate people here and in Europe about how to help these patients.

CHI-Advancing California biomedical research and innovation

CHI Spotlight: Opening a New Door for Unfunded Research Projects

Marc Boutin

The National Health Council (NHC) is the only organization of its kind that brings together all segments of the health community to provide a united voice for the more than 133 million people with chronic diseases and disabilities and their family caregivers. Made up of more than 100 national health-related organizations and businesses, its core membership includes approximately 50 of the nation’s leading patient advocacy groups, which control its governance.


Marc Boutin serves as the organization’s executive vice president and chief operating officer. Throughout his career, he has been actively involved in health advocacy, policy, and both federal and state legislation. He has designed and directed advocacy strategies for legislative initiatives, which have included issues ranging from access to healthcare to cancer prevention. Before joining the Council, Boutin served as the vice president of government relations and advocacy at the American Cancer Society for New England. In addition, he was a faculty member at Tufts University Medical School, where he lectured on healthcare policy.

Q: I understand the National Health Council has started a new program that connects promising biomedical research with funding sources. Talk a little about the impetus for your newest endeavor, HealthResearchFunding.org?

A: HealthResearchFunding.Org was conceived several years ago by a group of chief medical officers and research directors from NHC member patient advocacy organizations. They recognized the need to make the best use of the significant expertise and funds spent on the rigorous scoring of research proposals. With the help of the National Institutes of Health (NIH), the NHC set out to develop an innovative solution to make the most out of the nation's investment in biomedical research.

Q: How might someone who is interested participate?

A: Researchers whose proposals have been peer reviewed, deemed meritorious, but unfunded by either the NIH or by an NHC member organization, are invited to register with HealthResearchFunding.org. Once registered, researchers can upload requests for proposals and search for funding sources. There is no charge for use of the site by investigators or their institutions.

By using this online resource, potential research supporters can avoid duplication of effort and more efficiently identify and evaluate peer-reviewed research proposals. On the other hand, researchers gain another opportunity to showcase their worthy proposals and possibly find a funding source.

The database will be expanded later this year to include NHC business and industry members and funding sources outside NHC membership.

Q: Who may search the database?

A: Registered investigators have the ability to search for funding sources through the database, but cannot view or search for proposals from other researchers. Funding sources are able to search for research proposals, individual researchers and information from other funding organizations.

Q: How does HealthResearchFunding.org help researchers?

A: HealthResearchFunding.org helps researchers obtain a broad audience of potential funding sources from the nonprofit sector for their proposed research.

By offering investigators the opportunity to promote their peer-reviewed research proposals through the database, we hope to increase the likelihood of potential funding for worthy health research. By utilizing the database, researchers gain an organized and unvarying environment in which to exhibit their proposals alongside their peers. As the system grows, their respective research institutions could spend less time, effort, and resources looking for financial support and more time conducting research to aid in the development of new treatments for patients.

Q: How does this database help funding sources?

A: HealthResearchFunding.org helps participating funding organizations avoid duplication of effort as they seek to fund research by making use of the significant public investment of intellectual capital, time, and funds in the NIH and NHC member peer review process. When on the database, funding organizations are able to upload requests for proposals and have the ability to post ideas for collaboration with other funding sources.

Q: What is the ultimate goal for this program?

Our goal is to help researchers and funding sources in their development of new treatments and cures for people with chronic conditions.

To do so, we hope to expedite the process by which participating non-government funding organizations underwrite biomedical research by linking them with researchers whose proposals to NIH and NHC member organizations have been deemed meritorious and worthwhile.

To learn more, visit http://www.healthresearchfunding.org/ or write to healthresearchfunding@nhcouncil.org.


CHI-Advancing California biomedical research and innovation

Speaker Spotlight: Judith Kjelstrom, Ph.D., Director of the UC Davis Biotechnology Program

Judith Kjelstrom

Judith Kjelstrom, Ph.D., also known as Dr. Judy, has a rich background in health science and biotechnology education and training, clinical laboratory science, microbiology and immunology and program administration. She directs the UC Davis biotechnology program and the advanced degree program for corporate employees. Besides co-directing the UC Davis-Howard Hughes Medical Institute's Integrating Medicine into Basic Science graduate training program, she is also a lecturer in the departments of microbiology and molecular and cellular biology at UC Davis. Kjelstrom received her bachelor's degree in biology from Sacramento State University and her doctorate in microbiology from UC Davis.

If you have not already secured your ticket to hear Dr. Judy speak next week, contact CHI!

Q: As the director for UC Davis’ Biotechnology Program, how would you describe the environment for biotech education?

A: The environment at UC Davis continues to be strong in all aspects of biotechnology education from undergraduate to doctorate level. UC Davis continued to increase its prominence in research, especially in the sciences. The campus received more than $684 million in research funds in the last year. While federal research dollars fell slightly as stimulus funds tapered off, awards from non-governmental organizations quadrupled and state research funding grew by half.

Due to the breath of expertise and the collaborative nature of the various schools and colleges, we are able to offer research opportunities in biomedical application, agricultural and environmental biotech as well as the newer industrial areas such as biofuels. Enrollments in biotech-related programs continue to grow. For example, the Designated Emphasis in Biotechnology (DEB) graduate program, which is housed within the biotechnology program, has grown from 20 students in 2000 to 220 Ph.D. students in 2012. Having fellowship support for graduate training is critical for recruiting the most talented students to campus.

We recently received another five-year renewal for the National Institutes of Health training grant in biomolecular technology, in which the DEB is the formal graduate education program. Other related training grants, in which I am involved, are the National Science Foundation-funded Integrative Graduate Education and Research Traineeship (IGERT) program and the UC Davis-Howard Hughes Medical Institute Integrating Medicine into Basic Science training program, which provide additional scholarship support for DEB students. Our industry partners provide additional training through paid internships and co-ops, which are required for all DEB graduate students.

Q: What do you see as some of the biggest challenges, from an educational standpoint, going forward?

A: In a recent statement by Chancellor Linda Katehi, reduced funding from the state of California has challenged all of the UC campuses. Increased dependence on student tuition and private funding to meet our education and research missions puts in question the very nature of the university and its relationship with the state and public. In the 1960s, the California Master Plan led to the creation of what is recognized widely as the best public research university in the world. But, in the past 20 years, the commitment to the master plan has eroded and continues to do so. The state's contribution to students on the UC campuses has been reduced from $17,000 per student in 1990-1991 to less than $7,000 per student in 2010-2011. In the past four years, UC Davis alone has lost 40 percent of its state budget, while tuition has increased by 84 percent. The future competitiveness of both California and America depend on a healthy and widely accessible UC system.

Moreover, in today's academic environment, research is a vital part of this learning. For a nation that wants to be a global leader through innovation, this must be a skill accessible to all citizens. The ability to think creatively, act entrepreneurially and drive change when needed must be part of our public identity.

The biotechnology program has been hit hard by budget reductions and is unable to expand our staff and operational budgets to meet the growing demand for our programs in graduate education and K-14 outreach. Paid industrial internships for the DEB students are in constant demand, outreach programs such as BiotechSYSTEM, Teen Biotech Challenge, Biotechnology in the Classroom are underfunded, but are critical pieces of biotech education in the regional high schools. Without corporate support, we cannot meet the needs of students involved in biotechnology.

Q: What are some of the challenges you have already overcome?

A: We continually seek new corporate partners for DEB industrial internships and sponsorships for our “Train the Trainer” workshops and biotech enrichment programs for middle school and high school students. High school students who enter the Teen Biotech Challenge are hungry for summer research experiences, but funding and research mentors are limited. To address this need, the biotechnology program has partnered with the Institute of Regenerative Cures at the School of Medicine to apply for a creativity award through the California Institute of Regenerative Medicine to provide summer research experiences for winners of the TBC.

Q: What are you most looking forward to hearing about at BioMed Innovation Night?

A: I am eager to meet Percival Barretto-Ko in person and learn more about ScienceWoRx. He and I share a passion for medicine as well as teaching. I would like to explore strategies as to how we might develop a similar partnership in the Sacramento Valley. Academic-industry-government partnerships will enable us to build a strong STEM workforce.






CHI-Advancing California biomedical research and innovation

CHI Board Member Topol Pens New Digital Health Book

Dr. Eric Topol

CHI board member Dr. Eric Topol, a cardiologist who serves as chief academic officer of Scripps Health and vice president of the West Wireless Health Institute in La Jolla, has published a book about modern medicine and the influence of digital health.

The book, “The Creative Destruction of Medicine: How the Digital Revolution Will Create Better Health Care,” is now available here.

Topol, who came to La Jolla from the Cleveland Clinic, is a pioneer in the fields of wireless medicine and genomics.

CHI-Advancing California biomedical research and innovation

Event Spotlight: CHI Unveils CEO Survey Results at J.P. Morgan Healthcare Conference

The J.P. Morgan Healthcare Conference marks the start of each year for the biomedical community.

This year’s 30th annual meeting drew 8,000 attendees to the San Francisco area where biomedical companies set up shop inside the Westin St. Francis Hotel to showcase their latest research and unveil strategies for the year ahead. In attendance were members of the investment community, global industry leaders, technology innovators and media.

CHI highlighted results of its CEO Survey during a press conference attended by news outlets including Nature, BioWorld Today, Chemical & Engineering News and San Francisco Business Times, among others. The press briefing featured a panel of biomedical industry executives from Omniox, NuVasive and Theravance, who each shared their unique experience with raising capital, advancing important biomedical research and working with the U.S. Food and Drug Administration. CHI President and CEO David Gollaher, Ph.D., moderated the panel alongside BayBio President and CEO Gail Maderis and PwC National Life Sciences Partner Tracy Lefteroff.

Findings of the CEO Survey reflect issues discussed throughout the biomedical industry and provide an early glimpse into the 2012 California Biomedical Industry Report, due in February. The report, published annually by CHI, BayBio and PwC, provides a snapshot of the biomedical industry in California, the largest biomedical cluster in the world and the source of the greatest number of products in clinical development.

Among the notable findings were:

• Nearly three quarters (74 percent) of biomedical industry CEOs surveyed said their companies have had to delay a research or development project in the past year.

• Lack of funding was the top reason for project delays cited by private company CEOs, and accounted for more than one-third (40 percent) of delays by all public and private companies in the survey.

• Eight in 10 CEOs surveyed agreed or strongly agreed that the current FDA regulatory approval process has slowed the growth of their organization.

Additionally, 80 percent of CEOs surveyed do not believe that U.S. FDA has the best regulatory approval process in the world, and three-quarters believe that within five years, another country could conceivably recreate the ecosystem that has made the U.S. the leading biomedical region in the world.

“Sound public policy and managerial and operational improvements at FDA, along with responsible congressional oversight, will encourage biomedical innovation and, ultimately, job growth here in California,” Gollaher said. “Working collaboratively with other stakeholders, Congress, FDA and the biomedical industry can maintain the high standards of safety and effectiveness that address patients’ need, while improving our ability to attract investment and grow in 2012 and beyond.”

The survey was conducted in November 2011 and targeted approximately 100 pharmaceutical, biotechnology, medical device, diagnostics or medical equipment companies that conduct business in California.

Thank you to everyone who was able to attend or call into our CEO Survey results briefing! We will unveil the full 2012 California Biomedical Industry Report at BioMed Innovation Night, happening Feb. 8 at the Sacramento Memorial Auditorium. Register here for the event and check back with us at http://www.chi.org/ on Feb. 8 for full report details.

CHI-Advancing California biomedical research and innovation

Executive Spotlight: Igor Gonda, Ph.D., President and CEO, Aradigm Corp.

Gonda, Ph.D., joined Hayward, Calif.-based specialty pharmaceutical company Aradigm Corp. from Genentech, where he led a team focused on developing inhalation products for severe respiratory disease. Today, Gonda leads Aradigm scientists on a mission to revolutionize the quality of life of patients with severe pulmonary disease. The Aradigm team pioneered the AERx iDMS pulmonary delivery of insulin that was used in Phase 3 clinical trials conducted by Novo Nordisk. Now, Aradigm is uniquely positioned to develop a portfolio of its own products to treat patients with severe respiratory diseases. Current activities include development programs addressing the treatments of bronchiectasis, cystic fibrosis, inhaled bioterrorism infections and smoking cessation.

Q: Share with me a short history of Aradigm.

A: Aradigm was a venture-founded company and we went public in 1996. We were at one point a very large company with about 400 employees and we had very large manufacturing operations focused on the development of pain management therapies and inhaled insulin. Then, the inhaled insulin program was taken over by Novo Nordisk. The deal, however, was later terminated. The company completely changed its view of how we should operate.

So, now, we are mostly virtual. We kept the intellectual property and the know-how of the company and, now, have 12 people. The core of the company is basically the R&D group that I brought with me from Genentech. We also brought a medical director who was a former Roche employee. He was working on the same Genentech product that we were working on, which is the first modern drug that was approved for cystic fibrosis patients.

Q: What are some of the limitations in lung disease therapies that Aradigm is addressing today?

A: The common denominator, particularly for cystic fibrosis, bronchiectasis and chronic obstructive pulmonary disease, is that the severity of the disease rapidly grows when these people get an infection with a particular microorganism called Pseudomonas aeruginosa. There has been a strong association between severity of the disease and reduced life expectancy and a person’s colonization with this microorganism. About 80 percent of adult cystic fibrosis patients are colonized with Pseudomonas aeruginosa.

There are two products approved, two inhalation antibiotics, for the treatment of Pseudomonas aeruginosa patients in cystic fibrosis. The problem that these patients with cystic fibrosis have is that they are spending enormous amount of time just treating their disease, and, because they are born with the disease, typically, for many years, it is not just a job for the patient, but it is the job for the families who look after them and some of these families have more than one cystic fibrosis child. So, it is a huge burden that the disease imposes on the patient and on the family.

Our idea, initially, was very simple and that was to provide cystic fibrosis patients with a once-daily inhaled antibiotic. One of the antibiotics that is approved is twice-a-day and the other one is three times a day.

Q: Talk a little about how you became involved in developing treatments for bronchiectasis (brong-ke-EK-ta-sis), a condition in which damage to the airways causes them to widen and become flabby and scarred?

A. This is a program we feel particularly proud about because it is a totally unmet medical need and we seem to be paving the way to provide something for the patients who have not been able to get satisfactory treatment.

This is a disease where inhaled antibiotics have so far failed because the problem with treating the pulmonary Pseudomonas aeruginosa infections of these patients was that many of them did not tolerate the inhaled antibiotics well.

Q: What does the competitive landscape look like for inhaled antibiotics?

A: There is another company developing a once-daily inhaled antibiotic for cystic fibrosis. They were put on clinical hold so I’m not sure if and when they will be able to proceed. Ours is a different class of antibiotics. Our antibiotic is also a broad-spectrum antibiotic so we actually can go after some of the other bacteria, both gram negative and gram positive bacteria, as opposed to just going specifically after Pseudomonas aeruginosa.

Q: Talk about your tobacco smoking cessation product and how that fits into your product pipeline.

A: The most common cause of respiratory disease is smoking. Smoking causes more healthcare damage than malaria, tuberculosis and HIV put together. In the United States, roughly about 1,200 people a day die from smoking-related diseases.

We suspected that if we emulate the pharmacokinetics of cigarettes, that is, if we deliver nicotine deep in the lungs and it will then absorb quickly into the pulmonary artery which feeds the brain, that it will have a profound impact on the craving for cigarettes. So, that is exactly what we have done. We dissolved nicotine in a small amount of water and put it into a little inhaler that was developed for deep lung delivery. Most of the original investment in this inhaler technology was for pain management — to achieve quick relief of pain — which we developed about a decade ago.

And we found exactly what we suspected: In a single breath, single inhalation of pure nicotine dissolved in water, you can get very rapid entry of the nicotine into the bloodstream and an immediate and sustained impact on craving for cigarettes. So, we are very excited about looking for a partner for this program.

Q: We recently saw the FDA move to control electronic cigarettes. What do you anticipate will be some of your regulatory hurdles in terms of tobacco cessation?

A: We are not sure whether our product will be controlled as a tobacco product, and, therefore will need a very different path to acceptance by the regulatory authorities, or whether the FDA would prefer us to develop it as a prescription product, and, which, initially, a doctor would prescribe it because a lot of these nicotine replacement products eventually become over-the-counter products that do not require prescription.

Q: What are some of your other goals for the next year or two?

A: We’d like to bring Pulmaquin — the inhaled antibiotic — to the patients with bronchiectasis and cystic fibrosis as fast as possible. So, that is what our company is focusing on. And, in the background to that, we are looking for a partner that would be able to do global developing and marketing of the smoking cessation product.

Q: Are you looking for those partnerships now?

A: We are seeking partnerships for the inhaled antibiotic and for smoking cessation. Partnerships bring valuable expertise and resources to the company.


CHI-Advancing California biomedical research and innovation

Speaker Spotlight: Marc Boutin, Executive Vice President & COO, National Health Council



Marc Boutin

The National Health Council brings together all segments of the healthcare community to provide a united voice for the more than 133 million people with chronic diseases and disabilities and their family caregivers.
Boutin has been actively involved in health advocacy, policy, and both federal and state legislation throughout his career. He has designed and directed advocacy strategies for legislative initiatives, which have included issues ranging from access to healthcare to cancer prevention. Before joining the Council, Boutin served as the vice president of government relations and advocacy at the American Cancer Society for New England. In addition, he was a faculty member at Tufts University Medical School, where he lectured on healthcare policy.

At the CHI 2011 Annual Meeting, to be held Nov. 3 in San Francisco, Boutin will discuss the Moddern Cures Solution, a proposal to update the U.S. regulatory system to remove barriers to innovation and provide greater predictability in the search for answers to the nation’s unmet medical needs. It is not too late to register.

Q: Let’s talk about the impetus for the National Health Council. What was the driving need behind its formation?
A: The National Health Council was formed in 1920, so we have a long history. We were formed by a group of about 20 patient organizations that was looking for a trade association.


Q: Were there any other large trade associations of its kind in existence?
A: No, and there currently is nothing out there. We still serve in that function, so half our work is really directed at member services. Our work includes anything from board management, governance, corporate structures, volunteers, income development and benchmarking studies. We still maintain what is called the standards of excellence. The standards are a set of nonprofit standards, essentially, that the patient groups have to meet in order to be in membership. They are actually the most strident nonprofit standards in the industry.


Q: How is your organization funded?
A: We are a dues-based organization so about half our income comes from dues and the other half comes from sponsorships.


Q: Can you give me an example of some of the leading patient advocacy groups that make up your membership?
A: Some of the original founders include American Cancer Society, American Heart, American Diabetes and we run the gamut from those very large groups such as Easter Seals to small groups that represent various disorders like Sjögren’s disease or Alpha-1.


Q: What unique function does your group serve?
A: We are able, through our process, to engage the community, create a common understanding and then a common platform from which to advocate on systemic issues. And when they come together, they tend to have a great deal of impact.


Q: What are some of those messages you are working to convey through this organized effort?
A: In terms of public policy, we really are focused on two different things. One would be access to care, so we’ve been heavily involved with the implementation of health reform in a variety of different initiatives right down to the level of helping craft part of the regulatory language, as well as the legislative language, that created the Affordable Care Act. So, for example, we worked on defining the essential health benefits the Secretary of Health and Human Services is working on. We did our own actuarial analysis of what it would mean to put certain benefits into the design. We did recommendations on regulatory language.


On the other hand, we are extremely interested in development of new treatments, and so there is the dual focus.


Q: Tell me a little about your latest effort, the Moddern Cures Solution, which stands for Modernizing Our Drug and Diagnostics Evaluation and Regulatory Network?
A: We are promoting legislative language that will do two things. It will, one, allow a company to bring a medicine to market without a patent, and that is significant. A lot of people don’t understand, but when somebody identifies a new potential medicine in the early pre-clinical phases, it typically will go to a company that could develop and commercialize that product and bring it to U.S. Food and Drug Administration approval. In 80 percent to 90 percent of those cases, new potential treatments are dismissed not because the science is not good, but because they have weak patents.


It just makes no sense from a patient perspective, and this legislation corrects that. It says if you’ve got good science, you can bring it to market, receive a return on your investment, and still allow a generic to enter at a predetermined time.


Q: Does this proposed change include medical devices?
A: That is the second half of the legislation. There are mechanisms that address specific issues such as creating the incentives to invest in the device/diagnostic arena.


Q: Is this modeled after any other country’s system?
A: No, and actually these initiatives were identified by the chief medical officers of the patient groups. In other words, they came to the council about five years ago and said, “We’ve doubled the investment in the development of new treatments, and we are not getting double the output of new treatments.” And they start to look at the lifecycles of the development of treatments and diagnostics and identify barriers.


And then asked us to look at possible solutions and we settled on these four major issues and developed solutions that we think could work, but are not actually modeled on existing solutions. We are, however, already seeing Europe and other countries look at this as a potential metric that they would copy.


Q: What has the reception been like so far from the policy side?
A: Extremely positive. It has been described by some as one of the few major health policies that has bipartisan support and the current Congress and administration could actually enact. It is exciting.


Q: What kind of dialogue do you hope to get out of the 2011 CHI Annual Meeting?
A: I am hoping, given the audience that will be at that meeting, that there will be a great deal of synergy on what we are doing on the development of new treatments and how it will positively impact the environment that your audience is working and living in.

I figured it is an incredible event, and I was really pleased to be invited to participate.

CHI-Advancing California biomedical research and innovation