The Winston Churchill Memorial Trust of AustraliaReport By NADINE BREW, 2014 Churchill Fellow

Investigate MedicalResearch Commercialisation& Innovation Initiatives

The Jack Brockhoff Churchill Fellowship to:

Jan _ Feb, 2016

I understand that the Churchill Trust may publish this report either in

hard copy or on the internet or both, and consent to such publication.

I indemnify the Churchill Trust against any loss, costs or damages

arising out of any claim or proceedings made against the Trust in

respect of or arising out of the publication of any report submitted to

the Trust and which the Trust places on a website for access over the

internet.

I also warrant that my Final Report is original and does not infringe

on the copyright of any person, or contain anything which is, or

the incorporation of which into the Final Report is, actionable for

defamation, a breach of any privacy law or obligation, breach of

confidence, contempt of court, passing-off or contravention of any

other private right or of any law.

Nadine Brew

Acknowledgements

I am exceptionally grateful and humbled to have had the experience

of being a Churchill Fellow. I wish to acknowledge the Jack Brockhoff

Foundation for sponsoring my fellowship. Having met with Foundation

representatives at numerous Churchill Trust events, they have been

particularly supportive and engaged with my development and

professional ambitions. The Churchill Trust and Victorian Churchill

Association have similarly been very accommodating, informative and

friendly. It is a privilege to be a member of such a diverse, ambitious,

talented and warm-hearted network of fellows. My fellowship trip

coincided with a shift in my career focus and could not have been a

more valuable or exciting learning experience.

There are numerous professional mentors and personal supporters

I wish to acknowledge. Flora Wong, David Walker and Richard

Harding have provided thoughtful application feedback and written

glowing references for my multiple applications. Thank-you each for

your professional support, the exciting research opportunities and

friendship during my years at Monash. Antoinette Labour and Alex

Veldman kindly enabled me to be a part of the CSL team for a short

period and answered all my questions and emails to coordinate the

great experience it turned out to be. I am grateful that my friends

in Washington D.C. welcomed me back to the USA for a great time

while back in the district. Particular thanks to Samantha Ching

for arranging my visit with her friend and program director at the

National Science Foundation. Thank you to all of my other colleagues

in medical research and commercialisation who shared their time,

knowledge and expertise so willingly throughout my journey. I wish to

thank my parents and brother and sister for their encouragement and

interest in all that I do. To my fiancé, thanks for being there, being you

and continually supporting me in every way.

List of Abbreviations

A*STAR Agency for Science Technology and Research

ARC Australian Research Council

CSIRO Commonwealth Scientific and Industrial Research Organisation

CSL Commonwealth Serum Laboratories Ltd

CSLB CSL Behring

DALY Disability Adjusted Life Years

EMA European Medicines Agency

ETPL Exploit Technologies Pty Ltd.

FDA Food and Drug Administration

IP Intellectual Property

KoP King of Prussia

MRCF Medical Research Commercialisation Fund

NIH National Institutes of Health

NHMRC National Health and Medical Research Council

NSF National Science Foundation

OECD Organisation for Economic Co-operation and Development

PM Project management

R&D Research and development

SBIR Small business innovation research

SBTT Small business technology transfer

SME Small and Medium sized enterprises

STEM Science Technology, Engineering and Mathematics

TGA Therapeutic Goods Administration

RIE Research Innovation and Enterprise

VC Venture Capital

5

Introduction

1.1 What is medical research commercialisation and why does it matter?

Health innovation and research commercialisation are intended to be key future drivers of the Australian ‘knowledge’ economy. An Australian economy that is diversified and no longer reliant on natural resources for continued growth. The commercialisation of Australia’s medical research is critical for bringing new health products to the community and providing value to taxpayers, who fund the vast majority of medical research. In comparison to other industry sectors the development of new health and medical treatments is a very complex and slow process. Consequently, it is not always completely understood by politicians or the public and is often overshadowed by other less successful but straight forward sectors (e.g. technology and automotive manufacturing). Just some of the major processes in medicine and medical device development are product identification and development, testing in a range of healthy and disease settings, validation, registration and complex manufacturing processes. To obtain regulatory approval for a single new medicine, before even one unit can be sold, it typically takes a minimum of ten years development and costs hundreds of millions of dollars, making the financial backing along the journey another key challenge.

Initial medical research breakthroughs are most often made in universities, hospitals and medical research institutes. Scientists spend years in testing and understanding the underlying mechanisms of potential new medical treatments. Academic research institutions do not have the role, expertise nor resources for funding high-risk and high-cost drug development programs. At this early stage the discovery, if suitable, often either becomes the basis of a new ‘spin out’ company or co-developed under a licence or partnership agreement with a pharmaceutical company. Medical research development requires partnership with investor and industry partners to ensure a new treatment can reach patients. Successful development of early-stage medical research is so high risk that the critical early years of commercial development are commonly known as the ‘valley of death’ (see figure 1.). During this stage of development researchers and entrepreneurs require mentorship, financing, robust scientific data, a solid intellectual property (patent) position and luck to remain viable and ultimately enter the market.

There are a number of international Australian businesses that are successfully commercialising medical research and providing thousands of jobs while improving user’s lives. AusBiotech reports that the medicine industry is one of Australia’s largest exporters of manufactured goods, exceeding the automobile and wine industry and responsible for over $4B in exports in 2012. In 2015 Australian biotechnology companies for the first time raised over $1.1B in capital. Key examples of major Australian medical companies are Cochlear (producer of the bionic ear for those with hearing disorders), CSL (develops plasma products for patients with bleeding disorders and other conditions) and ResMEd (global leaders in breathing apparatus development for sleep apnoea treatment).

Over recent years Australian university research discoveries have been acquired by global pharmaceutical companies for multi-million dollar deals. These exciting company sales contribute funds for public research and wealth for the inventors and investors. Such examples include, Spinifex originating from The University of Queensland and Fibrotech from The University of Melbourne, each acquired for $75M and $200M cash respectively with further milestone payments possible. In the future, with a more robust local medical research commercialisation ecosystem, more companies may remain in Australia rather than be acquired by global multinationals.

1.2 Economic and health opportunities for Australia from world class medical research commercialisation

The Australian community and economy stand to benefit substantially from a strong health and medical research sector. National benefits from a sector that optimally commercialises its R&D discoveries assist healthcare, the economy and education.

Health benefits: + Financial investment in health research improves the health and well-being of the population. An Access Economics report commissioned by the Australian Society for Medical Research estimated that for the average dollar invested in Australian health R&D, $2.17 in health benefits is returned.

university

pre-competitiveresearch

Valley ofDeath

Discovery Development CommercialisationProof of Concept

Reso

urce

s In

vest

ed

small business

foundations

investors

industry

Figure 1. Pathway of medical research commercialisation and ‘Valley of Death’ where simultaneously financial risk is high and the necessary resources available are low.

6

+ Australian patients with serious diseases have faster access to the latest treatments available through the clinical trials process. In Australia, approximately 1.34 million Disability Adjusted Life Years (DALYs are a measure of a year of healthy life lost) will be averted in 2023 relative to 1993 levels, (839,000 by males and 497,286 by females).

Economic benefits: + A strong Australian medical research and pharmaceutical sector provides well-paid and high skilled employment in areas such as advanced manufacturing, scientific research, patient care, marketing, legal, sales, operations, logistics, statistics and many more specialist fields.

+ Tax revenue from companies and their employees benefit the economy and spending is increased from a workforce with improved living standards and earnings.

+ Public health care costs are reduced due to a healthier population that spends less time in hospitals or in out-patient care.

+ Stem the brain drain: highly qualified Australians with in demand skills in other countries will not be forced to leave Australia to maintain employment. Furthermore, Australian biotechnology executives now based overseas will return home as opportunities improve.

Education benefits: + Improved job prospects in the scientific, medical and pharmaceutical sectors will lead to greater demand for tertiary qualifications and advanced training. Education is the biggest export industry in Victoria and will grow further with better career outcomes for graduates.

1.3 Australia’s track record for Medical research commercialisation

Australia performs very well globally in terms of research excellence and output, but less so in translating research into commercial outcomes. In the 2015 Scientific America Worldview biotechnology scorecard Australia ranks 2nd in the world for productivity and 4th overall in its total assessment of biotechnology innovation potential. In the other metrics measured relating to commercialisation, such as enterprise support and IP protection, Australia does less well ranked 18th and 22nd respectively.

Predominantly, Australia’s under performance in research commercialisation is due to the insufficient transfer of knowledge between researchers and industry. Based on OECD data Australia ranks 29th and 30th (out of 30 OECD countries) on the respective proportion of large and small to medium enterprises (SMEs) collaborating with higher education and public research institutionson innovation. Australia’s poor record at transforming discoveries into treatments means the nation fails to capture benefit from its considerable investment in research. This investment is substantial with the National Health and Medical Research Council alone administering $896M in health research funding in 2015. With the Medical Research Future Fund set to see the investment grow substantially over years to come.

There are numerous areas to address in order to improve Australia’s position in industry collaboration and commercialisation:There is great need to increase research commercialisation skills in Australia. Knowledge commercialisation requires capabilities in identifying projects, capturing and managing intellectual property, steering products through development and securing investment. There are 39 universities, 46 medical research institutes and over 100 hospitals performing medical research, all in need of this scarce expertise.

Another major impairment to Australia’s improved performance in research commercialisation is the lack of incentive for academic researchers to pursue industry collaborations. Professional advancement and career stability depends on short to medium-term grants and fellowships that are very largely awarded based on the applicants publication record. This system promotes the separation between academic and industry sectors and does not accommodate the longer time frames involved in the commercialisation process.

Commercial expertise and experience is challenging for Australian scientists to obtain because of the limited presence of multinational healthcare companies in Australia. As we are a small market, we are not able to support the industry infrastructure present in either the US or Europe. Our scientists generally are not able to experience work as part of large companies and gain commercial as well as academic sector experience. The Australian Association of Medical Research Institutes has called for a range of measures to improve commercialisation. This includes a commercialisation training component for PhD candidates, extending NHMRC Industry Career Fellowships to early career and student researchers and expanded seed funding investment opportunities.

The world’s most successful medical technology and pharmaceutical (biotechnology) ecosystems have a large pool of capital allocated to the venture capital asset class. Venture capital provides the funds for biotech start ups to remain in Australia and add value for as long as possible. Scarce local VC funding has largely driven new Australian biotechnology businesses to seek international, predominantly US, commercial investment or partnership. Investment from overseas can limit Australia from fully capitalising on it's research excellence and discoveries.

1.4 Australia’s new innovation and science focus: getting it right!

At the end of 2015, the federal government announced policy plans and funding to stimulate an Australian ‘knowledge based economy’. Through the National Innovation and Science Agenda, programs were announced to improve STEM training, industry partnerships, commercialisation and stimulate a so called ‘innovation boom’.

Both newly appointed, the CSIRO Chief Executive (Larry Marshal) and our Chief Scientist (Alan Finkel) have backgrounds in entrepreneurship and founding high tech businesses. It remains too early to tell if these policies and appointments will deliver on their promises. One of the most important aspects for success is vision beyond the election cycle. Programs that are cut after not receiving sufficient time to deliver outcomes will see the sector slipping behind. Understanding these complexities is necessary to steer Australia’s roadmap towards success and prevent us falling further behind in terms of medical research commercialisation.

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1.5 Objectives

The key objectives for my study mission were devised to enable me to broaden my understanding of medical research commercialisation and to develop an appreciation of how this is achieved in leading countries. With this knowledge I will be better equipped to expand, perform and promote medical research commercialisation at the Hudson Institute of Medical Research in Melbourne Australia and throughout my future career.

+ Improve understanding of late stage drug development process

+ Learn how commercial pharmaceutical R&D differs to academic research programs

+ Learn how government-funded research commercialisation programs are designed and implemented

+ Identify cultural and economic influences around attitudes to entrepreneurship

+ Understand how leading industry focused medical research institutes collaborate and work with industry

+ Understand Australia’s place in local SE Asian medical commercialisation landscape + The role of proactive governments in promoting a diversified economy with strong biotech and medical industry

-

Nadine Brew PhD

nadine.brew@hudson.org.au+613 8572 2528Richmond, Victoria

Commercialisation and Business Development Coordinator, Hudson Institute of Medical Research

+Project Description

Investigating Medical Research Commercialisation andInnovation Initiatives

Highlights

Learning about different aspects of medical research commercialisation across USA, Germany and Singapore. In particular pharmaceutical development processes in Philadelphia, entrepreneurship and commercialisation in Washington DC, industry-academic research institutes in Frankfurt and government led industry development programs in Singapore.

Major Lessons and Conclusions

Australia is among the top countries in the world for medical research and scientific discoveries. By steering our world class scientific expertise and infrastructure to deliver improved commercialisation of our medical research, substantial health and economic benefits will be achieved for Australians. Public and private investment in commercialisation, enhanced education programs, support for industry-engaged academics and effective communication strategies to engage the community are critical steps to realising improvements in the Australian medical research commercialisation ecosystem. Plans to disseminate and implement in Australia: Circulate the report amongst colleagues, professional networks and those I met with throughout the fellowship. Knowledge obtained through the fellowship will greatly strengthen my role facilitating medical researchers in industry and commercial engagement.

Executive Summary

8

USACSLB, KoP, Philadelphia

2 weeks internal placementDrug development—Antoinette Labour [Senior Project Manager]

Dr. Deborah Benson-Kennedy [Global Clinical Therapeutic Head]

Dr. Diana Lanchoney [Program Director, SBIR/STTR]

National Science Foundation,

Washington D.C.

InterviewGovernment research commercialisation initiatives—Dr. Ben Schrag[Program Director, SBIR/STTR]

National Institutes of Health,

Bethesda, Maryland

InterviewGovernment research commercialisation initiatives—Dr. Matt Portnoy[SBIR/STTR Program Coordinator]

Robert Vinson [Program Manager NIH SBIR/STTR Program Office]

J.P. Kim[SBIR/STTR Program Manager and NIH Extramural Data Sharing Policy Officer]

Betty Royster[Communications Specialist for SBIR and STTR programs]

Julie Beaver[SBIR and STTR Statistician]

GermanyCSLB, Marburg

Interview & attend company meetingsClinical trials for drug development—A/Prof Alex Veldman[Global Clinical Program Director]

Fraunhofer Institute for Biomedical

Engineering IBMT, Sulzbach

InterviewGovernment partnered commercial medical research institute—Prof Heiko Zimmermann[Managing Director]

BIODeutchland, Berlin

InterviewGerman biotechnology industry body—Dr. Viola Bronsema[CEO and Secretary General]

Ascenion GmbH, Berlin

InterviewIP development and management for network of German medical research institutes—Dr. Julia Eschenbrenner[Technology Scout]

SingaporeETPL, A*STAR, Biopolis

InterviewCommercialisation organisation for government research institute—Eugene Wee[Senior Vice President Planning, Innovation, Network & Enterprise Division]

Tan Hwee-Hoon[Senior Manager, Planning, Innovation, Network and Enterprise]

Biotechin.asia, Fusionopolis

InterviewStart up biotech media organisation—Dr. Laxmi Lyer[Editor & co-founder of biotechin.asia ]

Semoegy Advisers & Ventures,

Fusionopolis

InterviewMedtech and medical devices consultancy—Dr. Nealda Yousef[Founder of medical device consultancy and training business & Med tech Singapore meetup organiser]

United States of America

10

Understanding late stage pharmaceutical R&D at CSL

Overview and Rationale

CSL is a global specialty biotherapeutics company that develops and delivers innovative biotherapies that save lives and help people with life-threatening medical conditions. CSL Behring, an arm of the CSL company, develops and markets plasma and other biotherapeutic products. Their products are indicated for treatment of bleeding disorders including haemophilia, primary and secondary immune deficiencies, hereditary angioedema, neurological disorders and inherited respiratory disease. CSL was formed in Melbourne, Australia in 1916 and has approximately 14,000 employees (1,100 in R&D), with operations spread across 30 countries. In 2015 the entire CSL compa-ny reported total profit of US$1.4B and global revenues of US$5.5B. CSL is Australia’s only life sciences company of this scale and I wanted to gain some insight into their drug development and business processes. Distinct functional teams in CSL work together across a number of global locations, including; Melbourne, Australia, Marburg, Germany, Bern, Switzerland and Philadelphia and Kankakee, USA. At the Philadelphia and Marburg sites I visited, I was able to observe the day to day operations and meet with a wide range of executives and employees.

Activities during placements

I was fortunate to organise a 2 week placement period with a senior project manager at CSL, Philadelphia. Alongside Ms Antoinette Labour I was able to observe the early stage pre-trial product development phase of drug discovery and also the pre-launch processes occurring whilst a product is awaiting approval from regulators. At the Marburg offices I spent the day with Alex Veldman, Global Clinical Program Director, and observed meetings and discussions based on the clinical program he is currently overseeing.

Project management of drug development is critical to ensuring that the very expensive, time consuming and complex process occurs according to, or as close as possible, to plan and within budget. Project managers interact with all teams and personnel within a pharmaceutical company. Consequently, I was able to interact and learn about the broad range of roles and diverse functions required to launch a pharmaceutical product. During my time at CSL I participated in a range of senior meetings, and met with numerous members of the R&D team. Activities included:

+ Annual and 5 year budget forecasting and clinical trial scheduling

+ Monthly project management report preparation

+ FDA response planning for products under regulatory review

+ Planning for clinical and non-clinical studies programs

+ Launch planning for CSL’s first device and coordination with anticipated regulatory approvals for other products + Development of Project Scope documentation to progress through internal stage gate revision system

+ Product label and product information wording meetings between medical affairs and commercial operations

+ FDA auditing response package preparation following manufacturing site inspection/s

Global Regulatory Interactions at CSL

In order to sell a pharmaceutical product, it must be approved by relevant national (e.g. FDA in USA, TGA in Aus) or international (EMA in Europe) pharmaceutical regulatory bodies. Such bodies determine if a drug is safe, efficacious and that the product claims are true. During my time at CSL meetings were often held to discuss the company’s ongoing interactions with different pharmaceutical

Antoinette Labour and I at the Philadelphia offices of CSL where I spent two weeks in project management.

regulatory bodies. From these meetings I learnt that there are significant differences between the pharmaceutical approval processes in different regions and each with very different time frames. This necessitates substantial personnel and expertise in the regulatory affairs team to ensure approvals are achieved as efficiently as possible. To minimise possible approval delays local region based offices with experience and expertise in regulation have been established in key markets. For CSL primary markets include USA, Europe, Japan and Australia. I also learnt that regulatory approval decisions regarding product information claims can have major commercial impacts for the launch and sales of a drug. Following the submission of a product for approval, regulators typically request further clarification of certain claims or datasets. The timelines for these responses to regulators have strict pre-defined timelines that a company must meet. To facilitate global regulatory approval under numerous tight deadlines, risk assessments may be performed to mitigate different potential scenarios. The different regulatory approval requirements also mean that pharmaceutical products have staggered launches to be coordinated around the world.

In addition to the process of product approvals, there is a considerable amount of additional regulatory requirements, across different jurisdictions that companies must comply with. An example is to respond to inspection reports for company sites such as manufacturing plants and clinical trial sites.

11

The regulatory affairs team plays a critical role within pharmaceutical operations and performs many tasks to work with regulators in ensuring that products are safe and efficacious for patients.

Intensive product preparation and production processes at CSL

Pharmaceutical product preparation and manufacturing involves many considerations I was not aware of until my placement. The pharmaceutical product preparation process can be divided into two phases. Initially product manufacturing is for clinical trial material and regulatory approval evaluations. Then in some cases, following first regulatory approval, production is scaled up for global distribution and sale; these changes are also subject to regulatory approval. Manufacturing processes at all stages require rational supply of personnel, equipment and raw materials to ensure product supply is sufficient without unnecessarily over producing. Furthermore, adequate product supply is obviously essential when the health of patients with serious medical conditions is in question. The production process for the CSL specialist coagulation products involves particularly complex processes at a range of sites around the world.These processes include fermentation, multiple purification steps, heating and dispensing. CSL often manufacture products requiring refrigeration which can add to the complexity to production, storage and distribution processes.

When determining product formulations and design there are important decisions to be considered with significant implications on production processes. Preparation type (tablet, injection, spray etc.), dosing intervals and shelf life can all have major impacts on treatment efficacy and the convenience and ease of use for medical professionals and patients.

Quality control measures are a critical part of production and need to be established, implemented and repeatedly performed during both the manufacturing and distribution processes at all stages. Quality control is a lengthy process as it is necessary for pharmaceutical regulatory approval to determine product shelf-life stability for a minimum of 12 months. In order to meet this requirement production of formulations needs to have been initiated at least 12 months in advance of any submissions.

Clinical R&D at CSL

My former Monash colleague Alex Veldman has transitioned from a research clinician-role in Melbourne to become the Global Clinical Program Director at CSL in Marburg, Germany. Alex oversees a team of medical scientists who plan, coordinate, implement and analyse different types of clinical trials for clinical R&D. He also writes clinical study reports, journal manuscripts and the lengthy submissions to pharmaceutical regulators based on the outcomes of these studies.

During my visit I met with medical scientists who were each responsible for overseeing a specific CSL clinical trial. Because haemophilia is a rare disease with distinct disease sub-types trial patients are recruited from all over the world. Detailed and consistent data recording, patient management, recruitment and follow up must be performed at all clinical trial sites around the world. To further assist with the medical scientists a scientific writer on the team

contributes to the preparation of reports, protocols, manuscripts and regulatory submissions. On the day of my visit the Senior Therapeutic Area Head was in Germany from the USA. She provided a team briefing and overview of the companies R&D achievements in the past six months, including regulatory approvals, ahead-of-schedule submissions and progress on an international phase III study in progress. Long-term CSL operational goals including the upgrading of manufacturing and processing facilities and continued integration of acquired flu company, Sequiris, were also communicated. Additionally the ongoing strategic investment in CSL R&D will continue as the company aims to reach its revenue growth targets.

"My day with the CSL clinical R&D team emphasized for me the multi-disciplinary and team based approach of drug development."

The snowy CSL offices in Marburg, Germany. (above)-With Alex Veldman at the CSL offices in Marburg, Germany where I visited the clinical R&D team. (left)

12

In the afternoon Alex and I attended a meeting with commercial colleagues regarding the feasibility of developing an R&D program for a new indication for a product in late stage development. This meeting was interesting as Alex is a cardiologist and has in-depth knowledge of clinical unmet needs and key obstacles involved with the complex indication in question. My day with the CSL clinical R&D team emphasized for me the multi-disciplinary and team based approach of drug development. Conversely, academic research is often performed with smaller teams that may compete on certain topics rather than collaborate.

Risk management and planning at CSL

Drug development is one of the most high-risk business sectors in existence. It is not uncommon for small companies to fail or for share prices to halve following a negative result from a single clinical trial. Decisions regarding a product, change in a timeline or interaction with regulators can have major business ramifications. To mitigate this often uncertain business environment and enable proper planning, CSL invests substantial effort in risk assessment & mitigation and strategies. Risk management protocols are an important component for all stages of drug development to ensure continuous product safety measures are in place and commercial objectives are reached. The risk assessment process is evaluated on a regular basis in a streamlined and consistent manner. Established criteria are in place for collating necessary risk evaluations from numerous areas (i.e., safety, commercial, regulatory, scientific). A stage gate system is in place to assist the senior Review Group make decisions on which projects should and should not proceed to further development.

Balancing commercial risk and technical risk is inherent in almost every drug development investment decision. To achieve return on a drug development investment, the products need to demonstrate differentiated advantages over available competitors. If a product does not demonstrate benefits over other available treatments (e.g. improved ease of use such as longer dose interval, improved formulation such as lower volumes, more comfortable administration etc.), return on investment will most likely not be achieved. In this regard, while companies do try to find the most time and cost efficient path to licensure, they must invest sufficiently in the program to demonstrate the advantages of their product.

Product innovation and R&D pipeline at CSL

Patients are ultimately the major stakeholder in the drug development process. In response to patient feedback, customised products for particular patient subsets are in development at CSL. Such treatment innovations underway within the company include developing treatments with longer lasting efficacy (to increase dosing interval), improved stability (not requiring continuous refrigeration) and subcutaneous dosing (simpler administration than intravenous route). These products in the CSL pipeline capitalise on the existing plasma expertise and background within the company as well as brand recognition for this therapy.

More broadly, the CSL R&D portfolio contains potential future treatments from additional core company capabilities including immunoglobulins, specialty products and vaccines. The majority of research stage activities are performed at the Melbourne based Bio21 facility affiliated with The University of Melbourne.

Life CycleManagement#

Market Development

New ProductDevelopment

ImmunoglobulinsCore Capabilities: Haemophilia Specialty Products

Novel PlasmaProteins

Rec CoagulationFactors

Partnered VaccinePrograms

CSL689 rVIIa-FPInhibitors

CSL 112Reconstituted HDL

CSL627 rVIII-SC CSL654 rIX-FP

FibrinogenAortic EU

CSL830C1-INH subcut

Beriplex©

Japan

Hizentra©

CIDP

Voncento© EU

Hizentra© biweekly

Privigen© CIDP

Hizentra© Japan

Zemaira© EU Kcentra© USBleeding/Surgery

Specialty Products

Haemophilia

Immunoglobulins

In�uenza Vaccine

QuadrivalentFlu Vaccine

CAM3001GM-CSFR-AZ

CSL689 rVIIa-FPCongen Def

Partnered VaccinePrograms

CSL362 IL-3RJanssen

P. gingivalis/PODOH-CRC/Sano�

Discovery Projects

CSL650rvWF-FP

Partnered VaccinePrograms

Fibrinogen NewIndications

PCC NewIndications

Beriplex© NOACsDaiichi

FXIIa Antagonist

CSL324 G-CSFR

CSL346 VEGFB

CSL334 IL-13R

Pre-clinicalResearch Phase I Phase II Phase III Registration Commercial/ Phase IV

Vaccines & IPBreakthrough Medicines

Figure 2. CSL R&D portfolio and product pipeline.

13

National Science Foundation (NSF) Invests Millions Annually in Seed Stage US Businesses

Overview and rationale

The vision of the NSF is ‘to enable the nation’s future through discovery, learning and innovation.’ Overall, the total NSF budget across all fields of science and engineering is a staggering $7B. The NSF administers numerous initiatives that fund and support high-tech small businesses across the US. One of the most established and successful of these programs, and originating within the NSF, is the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. I met with Dr Ben Schrag, program director at the NSF and experienced entrepreneur, to discuss his role in supporting US science commercialisation and entrepreneurship.

Meeting At the NSF headquarters just out of Washington D.C., Dr Schrag and I discussed the NSF business support programs, global start-up hotspots and the challenge of identifying a successful entrepreneur. The SBIR/STTR program is overseen by the NSF Division of Industrial Innovation and Partnerships. The division is focussed on stimulating academic and industry partnerships as well as catalysing technology commercialisation. To achieve this, each year the NSF SBIR/STTR program invests in approximately 400 companies with an annual budget of approximately $200M and all managed by a small team of around 25 staff.

The SBIR/STTR program has quite a long history, having been in place now for almost 35 years (initiated as an act of congress in 1982). While science and technology have completely transformed during this period, the goals of the program remain largely unchanged- to rapidly commercialise high risk technologies with substantial commercial impact.

I was interested to learn from Dr. Schrag how program directors shortlist businesses to invest in for this highly competitive and prestigious funding scheme. Unlike most other forms of investment the funding is highly appealing to business founders because it is completely non-dilutive. To be competitive for funding prospective technologies need to be of high technical risk and in the very earliest stages of development. For such high-risk business proposals external private funding is exceptionally challenging or impossible to secure so the NSF (and other SBIR agencies) fills this important gap in the commercialisation pipeline.

Another equally important element of a successful application is the business case for the company and the potential for the future product to be disruptive to the current market. Reviewers for the SBIR/STTR program include not only scientific experts but also experienced entrepreneurs. This mix of science and business experience ensures that projects with the greatest commercialisation potential are selected. As well as market considerations, societal benefits such as education and health improvements are also considered.

To ensure businesses have timely access to funds, applications the SBIR/STTR program are accepted twice per year, more frequently than other government programs that often only receive applications

annually. SBIR/STTR investments are divided broadly into three phases, which each having distinct objectives.

Phase I / Feasibility Study or Prototype ~$150 thousand and 6 months

Phase II / Full Research and Development Effort ~$1 million and 24 months

Phase III / Commercialization Effort Private and Non-SBIR Allocated financing

Figure 3. NSF SBIR/SBTT Milestone-Driven Award Process

SBIR/STTR businesses are tracked by the NSF to assess their progress and success. Impressively, following phase II investment NSF businesses have gone on to obtain either an average of sales or private investment valued between US$30MS to US$90M. This impressive statistic clearly shows the flow on economic benefits the program and scientific sector can achieve from research commercialisation.

Dr. Schrag went on to also explain to me the major importance of non-financial support NSF program directors provide to companies. Dr. Schrag, and all fellow NSF program directors, have significant business and entrepreneurship experience. NSF program directors with ‘real world’ experience provide critical mentorship and support to businesses on their challenging path to commercialisation. As well as this assistance NSF companies become part of a large and valuable network of high-tech, small businesses that share experiences and consult one another along the commercialisation journey. Attracting NSF funds is a powerful signal of success and peer-reviewed endorsement to future investors and customers. Post-investment the NSF takes an active role in promoting its portfolio of businesses by supporting and facilitating participation at tradeshow events, conferences and investor forums.

Beyond NSF program activities I was also keen to learn about Dr. Schrag’s perceptions of US cultural attitudes towards entrepreneurship and the political and community support for the program. Unsurprisingly, political and broader societal support for small business and entrepreneurship is very strong in the US. This support is particularly high in renowned start-up ecosystems such as Boston and San Francisco. Interestingly I learnt that universities around the country are adapting at varying rates to the university ‘spin-out’ business model. While a spin out company is often more challenging and costly to develop initially, than an early stage technology licence agreement there, is ultimately more value for inventors and the university with the formation of a new and disruptive business. Regarding government funding for the SBIR/STTR program, the budget has increased over time and is supported broadly by both major political parties. A considerable achievement during recently challenging economic years that have included the global financial crisis.

14

NSF Success stories

_1. Bolt Threads

Silk is a lustrous, protein-based fibre that gives textiles their luxurious appearance and medical sutures their strength. Nearly all commercially available silk is produced on silkworm farms through a process that has been around for thousands of years. Silkworm cocoons are collected and degummed; the silk filaments are then reeled and twisted into yarn. Other species can also make silk, but none of these have been produced commercially to date. Spiders produce silk with strength and elasticity that far exceed those of silkworm silk. Unfortunately, spiders are territorial and cannibalistic, and each animal produces a very small amount of silk — which is not suitable for commercial production.

Scientists have attempted to develop methods to produce silks without silkworms or spiders for decades. Many industrial and academic groups have focused on producing spider silk through a variety of heterologous hosts, including plants, bacteria, yeast, and even goats. Those efforts have achieved varying success, but none has reached the economic efficiency and scale necessary to bring a product to market.

With research funding from the National Science Foundation (NSF), Bolt Threads, a California-based company, has overcome that challenge and is producing engineered silk, without spiders, at commercial scale. The kind of fabric the company makes is described as ‘programmable fibres’ where the company can introduce specific characteristics it wants the fabric to exhibit. For example, it can create silk that’s more durable and holds up in standard washer and driers, or create a cotton-like material that’s more breathable or holds onto colour better.

The fabric is made in a three-step process. The founders at Bolt Threads, 3 PhD scientists, engineer a microorganism and grow it in fermentation vats using yeast — the same way beer is made. Out comes the protein that the company collects and cleans up and is then finally sent off to be spun into rolls of fabric. The company’s process involves genetically modified yeast that metabolize sugar into silk proteins, which are separated from spent yeast cells and extruded into engineered silk fibers with consistent quality and mechanical properties.

“As a chemical engineer, I am excited to be developing and scaling a process, which incorporates such a diverse group of unit operations from fermentation through fiber spinning,” says Jason Ryder, vice president of manufacturing at Bolt Threads. “On any given day, we are solving complex problems spanning metabolic engineering to extensional rheology.”

Bolt has validated the robustness and transferability of its process for future commercial-scale facilities and continues to improve the production economics. Ryder believes such engineered silk fibers have the potential to be more sustainable than any textile material currently in use, because they are naturally biodegradable and they do not rely on petroleum feedstocks, heavy pesticide use, or livestock.Bolt recently announced a $32M round of new funding, bringing total funding to $40M. Bolt Threads is producing commercial quantities of engineered silk and is currently in yarn development. The company plans to have a textile product on the market by the end of 2016.

_2. Martek Biosciences

Martek Biosciences is a nutrient company that develops food supplements from algae. Crypthecodinium cohnii is an algae strain and naturally high producer of DHA, an omega-3 fatty acid that plays a key role in both infant development and adult health. Martek developed a way to extract the DHA. In turn, this knowledge allowed the company to extract ARA, another fatty acid important to infant health, from the fungus Mortierella alpina. These two innovations led to Martek’s first license agreement, in 1992, for the use of DHA and ARA. A year later, after entering into similar agreements with two more infant formula producers, Martek achieved the holy grail of corporate success: it went public. In 2010 Martek was acquired by Dutch Multinational Royal DSM for US$1.1B.

99% of infant formulas contain Martek’s patented blends of nutrients and additives. “If you go to any shopping mall in the U.S. and look at a child under the age of five, chances are the molecules we’ve made in our fermentation factories are in the brands he or she eats” explain Martek CFO Peter Buzzy . Martek molecules also make their way into 100 food products you’d see in a grocery store, and the company is developing proteins it hopes to turn into vaccines. Today, the Maryland-based business employs more than 500 people, boasts annual revenue of more than $300 million, and claims a billion dollar market cap. It also has an R&D site in Colorado and manufacturing plants in South Carolina.

It took Martek 17 years before it made its first dollar. How did the company brave this gauntlet? One word: SBIR, or the Small Business Innovation Research Program. For its first eight years, SBIR awards—almost 40 of them, including awards from the NIH—were the company’s major source of R&D funds. These contracts “validated our technology,” gave us credibility, and opened doors, recalls Buzzy.

Summary

+ Very earliest technologies receive non-dilutive NSF funding.

+ Funding divided into 3 phases to support ongoing development and fund ‘valley of death’ expenses.

+ Significant pool of young entrepreneurs applying from start-up hotspots such as Boston, San Francisco.

+ NSF is typically the developer/breeding ground of successful high technology industry programs. Often times these programs are rolled out other US government departments.

+ Strong public support of entrepreneurial culture in US and many young aspiring CEOs starting companies through SBIR programs

Perspective

The SBIR/STTR program provides financial and business assistance to thousands of high-tech US businesses. Unlike with private investments all control and ownership remains with founders, enabling them to source investment and grow their small businesses into major companies and employers around the US.

With NSF SBIR/STTR Program Director Dr Ben Schrag at their HQ.

15

The National Institutes of Health (NIH) Paves the Way for of US Medical Start-up Success

Overview and rationale

The NIH is one of the largest biomedical research facilities and supporters of biomedical research in the world. The NIH invests nearly $32.3 billion annually in medical research for the American people. About 10% of the NIH's budget supports projects conducted by nearly 6,000 scientists at NIH’s own laboratories, which are located just north of Washington DC. More than 80% of the NIH's funding is awarded through almost 50,000 competitive grants to more than 300,000 researchers at more than 2,500 universities, medical schools, and other research institutions in every state and around the world. NIH has the second largest SBIR/STTR budget of any federal agency, and in Fiscal Year 2016, NIH will provide approximately $870M dollars to small businesses to commercialize innovative technologies. The U.S. Department of Defense is the only U.S. agency to have a larger SBIR/STTR budget. There are 11 agencies in total that have SBIR programs, and the top 5 largest, including the NSF, also have STTR programs. As I am especially interested in medical research commercialisation, I wanted to meet with the NIH SBIR/STTR team to learn more about their research commercialisation program.

Meeting

I met with the NIH SBIR/STTR team who had great enthusiasm for their work and were happy to educate me about their programs. Similar to the NSF, the funding structure for applications follows the same three phase process (see page 15). Within the NIH, there are 27 distinct Institutes or Centers, each with a specific research agenda, often focusing on particular diseases or body systems. 24 of the Institutes and Centres make SBIR/STTR awards to small businesses in line with the field of research focus (e.g. cancer, infectious disease, cardiovascular disease). The majority of NIH SBIR/STTR supported projects are researcher-initiated, ensuring that there is a diverse range of businesses funded that are addressing different unmet needs in healthcare.

At the NIH approximately 1,500 businesses are funded every year from 6,000 applications received. NIH conducts a rigorous two tier peer review process, ensuring only the most meritorious proposals are funded. The scientific merit and the commercial potential of a technology are evaluated during review. NIH business founders range from graduate students to senior professors.

The NIH SBIR/STTR programs offer a great deal of flexibility to applicants, and the team has implemented a number of technical assistance programs to help companies move along the path of

commercialization, with an emphasis on reducing technology risk and increasing the probability of business success. In Fiscal Year 2015, NIH released the Commercialisation Readiness Pilot Program (CRP), which provides financial assistance with less restrictions than most other SBIR/STTR awards. The CRP can provide funding for clinical studies, intellectual property strategies, regulatory assistance and a variety of other services.

SBIR/STTR funding is of critical importance for many businesses, and is often the first source of capital that biomedical entrepreneurs receive. Without SBIR/STTR funding, many successful businesses would not currently exist.

Promoting awareness of the SBIR/STTR programs is a key priority of the team. Major awareness efforts and novel outreach programs have been implemented to improve this. Such measures include an annual conference and an annual cross country SBIR road tour. Potential SBIR/STTR applicants are strongly encouraged to attend such an event in advance of submitting an application. Success of the annual conference is shown by the spike in successful companies forming and receiving SBIR funding in conference location over the subsequent post-event years.

Globally, awareness of the successes of the NIH SBIR/STTR programs is growing. The NIH has met with delegations from Spain, Canada, Norway, France, Denmark, Japan and the UK amongst others.

"The majority of NIH SBIR/STTR supported projects are researcher-initiated, ensuring that there is a diverse range of businesses funded that are addressing different unmet needs in healthcare."

With the NIH SBIR/SBTT team, L-R; Rob Vinson, myself, J.P. Kim, Betty Royster and Julie Beaver.

NIH Success Stories

_Lift Labs

Lift Labs is a medical device company that creates stabilising technologies to help people with Essential Tremor and Parkinson’s disease. Both Essential Tremor and Parkinson’s disease are neurological movement disorders that interfere with many aspects of a patient’s daily life including eating, drinking and writing. Essential Tremor affects around 10 million people in the US alone and millions more are afflicted by tremors due to other neurological damage or

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dysfunction. Lift Labs has been acquired by Google in September 2014 and will be integrated into Google Life Sciences.

Anupam Pathak, the founder and CEO of Lift Labs, began his journey as a social entrepreneur after he graduated from his engineering Ph.D. program. As a graduate student, Pathak began developing his technical expertise through his work for the Army Research Laboratories where he developed technologies to stabilise weapons for soldiers in combat. Pathak soon realised that active stabilisation technologies, which offset tremors rather than suppress them, could be very useful to patients with essential tremors and Parkinson’s disease.

Upon graduating in 2010, Pathak applied for his first NIH Phase I SBIR award that provided funding for a feasibility study of an Active Cancellation of Tremor (ACT) device. His research results proved to be very promising and received additional Phase II SBIR funding in 2011 to continue product development through clinical research and additional R&D. Overall the NIH support was instrumental in accelerating all R&D efforts and enabling the commercialisation of the product within only three years.

In 2013, Lift Labs received private funding enabling it to launch its newly branded product, Liftware™, a spoon that uses sensors to detect hand tremors and counteract them to minimise the spilling of food. The initial launch generated a lot of interest online and the product demonstration videos received millions of views. This surge of online interest helped the product gain market traction and Lift Labs started to receive its first online orders. “In the summer of 2014, Lift

"...the NIH support was instrumental in accelerating all R&D efforts and enabling the commercialisation of the product within only three years."

Labs had about seven people on payroll and expected that to double by 2015,” explained Pathak. “Our future goals include expanding our product line to launch additional attachments, including a fork and a deep spoon, and a desire to keep designing products that stretched beyond eating utensils to commonly used hand-held tools, offering added benefit and relief to people with tremors.”

_Advanced Circulatory

Advanced Circulatory is a medical device company that develops non-invasive, circulatory therapy called Intrathoracic Pressure Regulation to enhance blood flow in patients suffering hypotensive conditions like shock, brain insults like head injury and stroke, and cardiac arrest. As of March 2015, Advanced Circulatory was acquired by ZOLL Medical. Keith Lurie, MD, an electrophysiologist and CPR expert, founded Advanced Circulatory in 1997, initially to address circulatory issues during CPR. Since then, the company has grown to employ 25 people and expanded their product portfolio. Currently, Advanced Circulatory sells it devices to over 1,500 hospitals and emergency medical services through a network of distributors.

According to the American Heart Association, 900 Americans experience sudden cardiac arrest every day, with 95 percent dying

before they reach the hospital. Conventional CPR provides only 20 – 30% of normal blood flow. Advanced Circulatory has addressed this problem by developing an NIH-funded therapy called Intrathoracic Pressure Regulation that helps increase blood circulation during CPR. The therapy is delivered via the ResQPOD Impedance Threshold Device. The ResQPOD ITD received 510(k) clearance from the US FDA in 2003, as well as the CE mark for sales in Europe.The ResQPOD ITD connects to a facemask or advanced airway during CPR. The device has been shown in studies to double blood flow to the heart and increase circulation to the brain by 50%.

When combined with high quality CPR, studies have shown that the ResQPOD increases neurologically-intact survival by 25% or more. The effect of the ResQPOD ITD is further enhanced when combined with an active compression decompression CPR device. The NIH helped to fund a large randomized controlled trial of the device combination. Published in The Lancet in 2011, this study showed a 52% increase in neurologically-intact survival when the device combination is used."This early-stage funding helped us develop our products and conduct pre-clinical and clinical studies to demonstrate their feasibility. And thanks to these grants we have been able to create several R&D jobs in our community. Without SBIR, Advanced Circulatory would likely not be a company."

Summary

+ Because all research themes of NIH receive funds grants do not become concentrated in more ‘hot’ or lucrative fields. This is positive news for patients with conditions that may be not key focus of industry R&D. E.g. paediatrics.

+ The NIH SBIR program is largest provider of medical business start-up funds in US.

+ Sophisticated commercialisation and business training programs provided in conjunction with NIH investment.

+ Very prestigious to be recipient of award which greatly facilitates venture and private capital raising by businesses.

Perspective

It was impressive to see that so many exciting and cutting edge medical concepts and discoveries are given the opportunity to be developed into life-enhancing or even life-saving products. When these products provide such a benefit to people’s lives it was heartening to see that the essential resources and support are also in place for successful businesses to be built and grown.

Liftware auto-stabilising spoon for correcting tremor while eating.

Germany

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IBMT Fraunhoher Institute: Bridging the gap between research & industry

Overview and rationale

Germany is a powerhouse of European innovation and manufacturing. The Fraunhofer institute system was established 50 years ago to bridge the gap between German research and industry. Today the Fraunhofer system consists of 37 institutes grouped into 6 themes. A famous example of Fraunhofer technology is MP3 digital technology co-developed by the Fraunhofer Institute for Integrated Circuits. I was particularly interested to learn more about the Institute for Biomedical Engineering (Institut für Biomedizinische Technik, IBMT) which has research strengths in the areas of biomedical/medical engineering (especially non-invasive as well as miniaturised technologies), biotechnology, implants, cryotechnology, biobanks and stem cell research. I met with institute director, Heiko Zimmermann, to learn about how IBMT successfully partners with German businesses and the exciting programs currently underway.

Meeting

Professor Zimmermann is a global leader in cryotechnology and biopolymers for clinical scaffolds. During his career at the Fraunhofer he is an inventor of more than 50 granted patent families from which more than 20 have been commercially licensed. At our meeting Prof Zimmermann provided an overview of the unique funding model for Fraunhofer institutes. In general terms the Fraunhofer institutes aim to be funded in equal measure from three sources; government funding, industry partnerships and competitive research grants. Due to the long running nature of life sciences R&D as well as the success of the Fraunhofer model industry partnerships at IBMT are often in place for a decade or more. Technology transfer from basic research ranges from scientific-technical consulting, feasibility studies, prototype development, field testing right up to manufacturing technology.

Over the past decade IBMT Fraunhofer has substantially expanded its capacity. Major European research collaboration initiatives have played an increasing role at the institute. In particular as part of the EU Horizon 2020 program as well as a branch of the IBMT now located in Cambridge, UK.

Figure 3. Model for German research organisations showing funding source & research modes.

research infrastructures

Public Funding Private Funding

Basi

c Re

sear

chA

pplie

d Re

sear

ch

academies

universitiesmax planck society

federal institutions

lönder institutions

helmholtz Association leibniz Association

fraunhofer-gesellschaft

networks & clusters

industrial research Association (AiF) companies / industrial research

The Fraunhofer model of businesses and scientists working together to develop new high-technology products and solutions is ideally suited to the European research sector. The commercial development and exploitation of intellectual property by individual researchers is less common in Europe when compared to the USA. Consequently IP value is generally developed through partnering with existing industry rather than being the basis of a new small business. Success of the Fruanhofer research model has not gone unnoticed by other European countries. In the UK a similar system, funded by Innovate UK, called Catapult, was launched in 2014. Interestingly, there are some key differences between the German and UK models with the ten Catapult institutes being headed by CEOs, rather than directors, and the focus on commercial outcomes being paramount.

The Fraunhofer network plays an invaluable role in German scientific skills training by producing researchers with world class complimentary skills in science and business. Researchers and graduates are highly sought after by industry, leading to the cross pollination throughout Germany of scientists in the business and academia sectors. Often Fraunhofer trained researchers working in businesses return to Fruanhofer institutes for R&D to maintain a competitive advantage for their organisation through innovation. The academic aspect of research remains a critical element of Fraunhofer with researchers having university partnerships and co-appointments as well as emphasis on publication of studies in high impact journals. Work-life balance is also possible for Fraunhofer researchers as the institutes are positioned in both small and large cities all throughout Germany.

Fraunhofer Success Stories

_1. Mobile Medical Diagnostic and Treatment Unit

Treatment and diagnostics of HIV/tuberculosis/ malaria and other infectious diseases require Biosafety Level 3 (BSL-3) laboratories. Already for conventional stationary laboratories the required

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installations and operator directives are restrictive and extensive. For decades, attempts have been made to construct a mobile treatment and diagnostic unit licensed for field and public road operation. In 2008, the Fraunhofer Institute for Biomedical Engineering IBMT was tasked to resolve this problem. After only 18 months of development, construction and testing together with the trailer specialists at Bischoff+Scheck, Rheinmünster, the vehicle has been approved under the strict German regulations.

The semi-trailer is built on a highly stable basis and has the maximum permitted length (18.5 m) and construction height (4 m) and is equipped with a comfortable interior facilitating complete decontamination. The vehicle is authorized for public roads through technical inspections by the German Technical Inspection Agency (TÜV) and has the corresponding operating permit necessary for the handling of biological material of BSL-3. Remote control via satellite and a network link are possible.

Since 2005 Fraunhofer IBMT has been strongly involved in the field of mobile laboratories. Starting with the design and development of units for its own use, this field of work matured over the last decade within several projects. Today Fraunhofer IBMT is mainly working in the area of consulting and conceptual design of mobile analytical and medical solutions for third parties. Mobile laboratories are a key competence of the network "Labor der Zukunft" (future's lab technology) where stakeholders with different background cooperate in the field of modern lab technology. Fraunhofer IBMT has the technological lead in this initiative with the Partners THIEMT and MESSKO.

_2. "RamanCTC" – Identification and characterization of

blood-circulating tumour cells

For many cell-diagnostic investigations, an individual-cell diagnosis is necessary. These investigations are particularly challenging when they involve a large number of cells. An application example addressed within the framework of the project "RamanCTC" is the recognition and counting of circulating tumour cells in a defined quantity of blood. The quantitative change of tumour cells in the peripheral blood over time is an important indicator for the evaluation of the success of tumour therapy and for the estimation of a prognosis for the patient. Today there is a wide range of modern methods and high-throughput processes in molecular biology, microscopy and molecular imaging for the individual cell analysis.

The identification of tumour cells is being carried out with the aid of Raman spectroscopy. For this purpose the Fraunhofer IBMT has provided new microchips that make a high cell throughput possible by allowing the precise positioning of a very high number of cells and thus their quasi-parallel investigation. Chips are currently being used with which around 200,000 cells can be arranged in less than two minutes in a regular, two-dimensional grid. The exactly positioned individual cells are on a transparent membrane of silicon nitride which

is about 1 m thick. Studies have shown that these membranes are ideal for Raman spectroscopy. In the Raman spectrum they generate only a very weak and barely structured background which can be easily filtered out of the Raman spectrum.

With the microchips described, tumour cells can be isolated and arranged directly after the erythrocyte removal from blood with unprecedented speed and precision. This leads to a reduction in the costs for diagnosis and therapy as the quantification and characterization of the circulating cells allows prompt adjustment of the therapy. As the cell positioning does not cause any damage, the technique can also be used to take individual cells from the chip after characterization for further use or investigation. Partners in this project include ALS Automated Lab Solutions GmbH and microfluidic ChipShop GmbH.

Summary

+ Fraunhofer institutes are a long running model for undertaking collaborative R&D with industry

+ Fraunhofer reputation is strong internationally and associated with world class commercialisation and industry collaboration that greatly benefits the German economy

+ Fraunhofer provides a unique scientific and industry focused training ecosystem for young scientists and trainees. These scientists often move on to specialist industry roles at successful innovative German companies.

+ Fraunhofer IBMT participates in a wide range of collaborative partnerships (industry and academic) around Europe

+ The Fraunhofer model exploits research generated IP for the benefit of collaborative and innovative German companies

Perspective

German investment in R&D infrastructure, with incentives for business, demonstrate that innovation and commercialisation can be implemented in all industry sectors, including medical research and biotechnology. Germany has invested heavily in many aspects of science and research and benefits from a strong sector and overall strong economy.

"Since 2005 Fraunhofer IBMT has been strongly involved in the field of mobile laboratories."

Meeting with IBMT fraunhofer director Heiko Zimmermann in Frankfurt.

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Ascenion: Mediating between science and business

Overview and rationale

Ascenion provides exclusive intellectual property, business and commercialisation support to a network of German medical research institutes. Ascenion has six offices throughout the country with the headquarters located in Munich. It operates by partnering with member institutes and gaining equity in the businesses it helps to create as well as revenues from licencing deals it negotiates. Revenues are then distributed to the network of institutes. The centralised model of research commercialisation improves efficiency and allows a larger network of experts to contribute skills and knowledge. Each year, Ascenion handles about 100 patent applications and negotiate around 80 revenue-generating cooperation and licensing agreements with industry. In addition, they support start-ups on the road to independence. All this helps create innovative products as well as jobs for Germany.

Meeting

Julia Eschenbrenner and I met in the Ascenion Berlin office to discuss technology transfer in medical research and the benefits of a centralised service for research institutes. This was of particular interest to me as my employer is a hospital medical research institute (Hudson Institute of Medical Research based at Monash Medical Centre) in Melbourne.

Julia explained to me why it is important to actively engage with researchers early in program development to ensure that the process of commercialisation and technology transfer is collaborative, consultative as well as strategic. Ascenion engages with researchers as early as possible to ensure maximum innovation and commercial potential is developed and to strengthen the IP position. With Ascenion insight and input into the overall research design, at the commencement of a program, there is both strengthened product development and commercial awareness for the team.

A major asset for hospital research institutes is the often widespread appreciation amongst researchers of the necessity of translational medical discoveries. Because laboratory leaders are often clinicians and scientists there is strong awareness of the limitations in the medical treatments of today and what the areas of true unmet need are. Sometimes competing with this goal of making a difference though are clinical commitments of these researchers and shorter appointments within research labs. Ascenion also provide research commercialisation education services to interested researchers and new staff training to ensure high levels of opportunity awareness and engagement.

Another aspect of accelerating medical research translation and collaboration across Europe is the EU Horizon 2020 program and its increased emphasis on translational outcomes and IP generation. Overall such measures are leading to today’s medical researchers being more aware of the pathway for research translation, commer-cialisation and innovation. This is mirrored in other sectors like technology and finance where Berlin is increasingly being recognised as a leading ‘start up’ city. Although medical products and devices are more time consuming to develop hopefully focus and investment will flow on to these sectors, as has occurred in Israel & San Francisco.

To maintain professional relationships and facilitate industry and investor partnerships Julia and her colleagues are regular participants at life sciences and biotech investor conferences and forums. A major advantage for Ascenion with investors is its access to proprietary IP from a network of institutes. This expanded IP position enables the grouping of relevant technologies for certain clinical indications. As a result the technological innovation on offer becomes far more appealing to potential partners.

I also learned from Julia how commercialisation and technology transfer processes were facilitated and harmonised throughout Europe. ASTP Proton is the European professional knowledge transfer society that provides training, accreditation and networking opportunities to members which Julia has been involved with. Knowledge transfer or knowledge commercialisation societies are important to establish best practice in an area such as technology transfer which is a relatively new field and has practitioners with varying training backgrounds and levels of experience.

"Each year, Ascenion handles about 100 patent applications and negotiate around 80 revenue-generating cooperation and licensing agreements with industry."

Success Stories

_1. Trianta

Trianta is at the forefront of personalized T cell immunotherapy, focussing on next generation antigen-tailored dendritic cell vaccines, T cell receptor (TCR)-based adoptive cell therapy and T cell-targeted antibodies. Trianta`s DC vaccines are being evaluated in two ongoing, externally funded investigator-initiated trials: a clinical phase I/II trial in acute myeloid leukaemia at the Ludwig-Maximilians University Hospital Großhadern, Munich, and a clinical phase II trial in prostate cancer at the Oslo University Hospital. Previous clinical compassionate use studies with Trianta`s DC-vaccines have already provided encouraging data for safety and clinical benefits in several tumour types.

Based on more than 15 years of extensive research in the field of immunotherapy, Trianta Immunotherapies GmbH was founded late 2013 as a spin-off of the Helmholtz Zentrum München, the German Research Centre for Environmental Health. Trianta exploits the therapeutic and commercial potential of T cell-focused therapies developed by the team of Prof. Dolores J. Schendel at the Helmholtz Zentrum Munich. The team of Trianta pursues three complementary immunotherapeutic strategies to target various tumour types and stages. Each one is focused on T cells, a type of white blood cell that plays a pivotal role in immunity.

Medigene AG has acquired the Munich-based company, Trianta Immunotherapies GmbH (Trianta), a spin-off of the Helmholtz

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Zentrum München. Trianta is developing three highly innovative and complementary immunotherapy platforms with programs in clinical development to treat various tumour types. Trianta`s proprietary technologies will enhance Medigene`s advanced pipeline with cutting-edge therapies. Prof. Dolores J. Schendel, Managing Director of Trianta and Director of the Institute for Molecular Immunology at the Helmholtz Zentrum München, is intended to join the Executive Management Board of Medigene as Chief Scientific Officer and will be accompanied by her team of 15 immunotherapy specialists from the Helmholtz Zentrum.

Trianta shareholders will receive approximately EUR 4 million and potential incremental payments in further Medigene shares or in cash of up to a maximum total of EUR 5.9M upon the achievement of future milestones.

Prof. Dolores J. Schendel, Managing Director of Trianta and designated Chief Scientific Officer of Medigene, explains: "T cells activated by dendritic cells are by nature the best weapons against cancer. The understanding of immune mechanisms has increased enormously over the last decade, and now our vision of activating T cells to effectively combat cancer is becoming a clinical reality. Trianta will benefit from Medigene`s experienced team and established operational structures. The union of our two companies will unlock diverse synergies to take our therapy platforms and innovative drug candidates through clinical development with the goal to improve lives of seriously ill patients."

_2.Vaccine Projekt management GmbH: New Tuberculosis vaccine reaches another development milestone

Ascenion portfolio company vaccine Projekt management GmbH and its licensing partner Serum Institute of India (SII) are set to start a Phase II trial of its new vaccine VPM1002 against tuberculosis. According to World Health Organization Tuberculosis (TB) is still among the most deadly communicable infections worldwide. In 2013 TB affected a total of approximately 9 million people and is responsible for 1.5 million deaths.

Dr Julia Eschenbrenner, Ascenion, and I meeting in Berlin.

The new vaccine is developed in a broad clinical program. VPM1002, a biomolecular evolution of the conventional BCG preparation comes from the Max Planck Institute for Infection Biology, its founding director, Prof. Stefan HE Kaufmann, is largely responsible for the scientific concept of the vaccine. SII, one of the largest vaccine developers in the world could, be a global licensee for the project. Ascenion has significantly contributed to the conclusion of the license agreement.

Two Phase I studies in adults and a Phase II study in newborns have been successfully completed. The data have consistently indicated that VPM1002 is much safer and more effective than the conventional BCG preparation that has been used for almost 100 years. Although the classical vaccine can protect against some forms of tuberculosis, its protective effect is insufficient and it is worrying that the BCG vaccine in HIV-infected newborns often causes side effects. "Research shows that the immune system of babies is often compromised, even if they themselves are not infected with HIV. These newborns need the new, safe vaccine especially urgently," said Adar C. Poonawalla, CEO and Executive Director of Serum Institute of India.

The double-blind, randomized, controlled intervention study, is to be carried out in study centres of the University of Stellenbosch, the Desmond Tutu Tuberculosis Center, the South African Tuberculosis Vaccine Initiative and the respiratory and meningeal pathogen Research Unit (ClinicalTrials.gov Identifier NCT02391415).

"It is an example of how an innovative product from the basic research is professionally made and advanced step by step," says Dr. Christian Stein, CEO of Ascenion. "The initiation of this trial is an important milestone on the way to our common goal: to provide the vaccine to people of all social classes in the world at fair prices.”

"Research shows that the immune system of babies is often compromised, even if they themselves are not infected with HIV. These newborns need the new, safe vaccine especially urgently..." (Adar C. Poonawalla)

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BIODeutschland: Industry representation for over 300 German biotechnology organisations

Overview and rationale

The Biotechnology Industry Organization (BIO) Deutschland is the national body for German biotechnology and represents over 300 organisations. BIODeutschland aims to support and promote the development of an innovative economic sector based on modern biosciences. Dr Viola Bronsema is the CEO of BIODeutschland and has previously worked in the pharmaceutical industry for many years. She kindly met with me to provide a broad overview of the German biotechnology landscape.

Meeting

Viola and I discussed biotechnology sector issues and strengths in Germany, improving the business environment for the pharmaceutical sector and the role of BIODeutschland in the future. The latest analysis of the German biotech sector has shown exciting improvements. Never before have German biotechnology companies employed as many people (17,930 in 2014) or generated as much revenue (EUR3.3B turn over in 2014) with much of this growth in medical technologies (such as drug development, diagnostics and platform diagnostics). As well as this there were the first biotechnology IPOs in Germany for many years.

A key strength of German biotechnology is the German Bioregions model. Under this arrangement different regions of Germany specialise in particular areas of research and facilitate the strong collaboration between universities, R&D institutes (see figure 3, German research organisations), and private sector companies. Under this model complimentary expertise and facilities are co-located attracting a critical mass of skills and expertise designed to lead to a flourishing R&D ecosystem. In more regional locations there is beneficial work-life balance options and affordable housing so staff can chose to move away from large cities if preferred. This BioRegion model incorporates the Fraunhofer institutes which play a crucial role in commercialisation (see p. 22).

A major issue that German and European biotechnology is facing at the moment is challenging investment hurdles for early stage biotechnology businesses. In Germany there are around 10-20 new biotechnology start-ups created each year. Non-US investors have less appetite for high risk and high return investing making it challenging for new businesses to attract funds to traverse the ‘valley of death’ stages. BIODeutschland members seeking business investments travel frequently to the USA to generate investment and also participate in the start-up accelerator widely programs on offer. One of the BIODeutschland specialised committees is focussed on US cooperation. The committee is aimed at taking advantage US opportunities and learning what lessons it can. Other specialist committees include: diagnostics, finance and tax, entrepreneurship, regulation and technology transfer.

"A major issue that German and European biotechnology is facing at the moment is challenging investment hurdles for early stage biotechnology businesses."

BIODeutschland has also played a major role in the recent German ‘Pharma Dialogue’ talks between the pharmaceutical industry and government. The dialogue was initiated to discuss the way Germany regulates pharmaceuticals, provides medicine reimbursements and sells generic medications. Additionally, the talks covered what is being discussed in most developed countries at the moment; the increasing price of innovative new drugs such as Sovaldi (Gilead HepC treatment) and many oncology medications. For the German government it needs to balance support for and protect the interests of the pharmaceutical industry in the country, which is very important for Germany's overall economy, and the need to respond to growing general healthcare spending, particularly pharmaceutical expenditure.

Similar to most countries public research funding levels fluctuate from year to year. A major pillar of the biotechnology sector is public project funding. This funding is indispensable for company foundations spun out of the academic setting. In 2014 the research ministry cut the budget for project funding by 10%. BIODeutschland has stated that ‘leading in innovation through key enabling technologies such as biotech needs robust reliable and sustainable political commitment’ and lobby politicians for this stable political support. Largely, the German biotechnology sector has shown recent promising developments and start ups and young companies recently secured Series A financing. As well as this there is strong academic-industry partnership and the highest rates of patenting in Europe.

Dr Viola Bronsema, BIODeutchland CEO, and I following our discussions.

Singapore

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Singaporean medtech, entrepreneurship and innovation

Overview and Rationale

Business founder (Semeogy), start-up mentor, medical device expert and investor, Nealda Yusof, is one of the most knowledgeable people in Singaporean medical research commercialisation. Hailing from Singapore originally Nealda also has an international med-tech perspective having completed her PhD in Singapore and a law degree in the UK. I wanted to meet with Nealda because now working as a medical devices consultant she has unique experience with a diverse range of companies ranging from start-ups to multinationals, all doing business in Singapore.

Meeting

Nealda and I had a stimulating conversation about the many aspects involved in a thriving biotechnology and medical sector. Such aspects included the role of STEM education, adaptive business culture, efficient regulation processes and the need for local venture capital investment. Singapore is considered a gateway market to Asia and has many research and lifestyle strengths attractive to businesses.

A highly trained and well educated work force is important for sustaining and growing a knowledge based economy such as Singapore’s. In particular the Singaporean economy has a very strong IT sector. Nealda explained to me how Singapore benefits significantly from having very high levels of IT literacy across the population. This strong grounding in technology is a key advantage for Singaporean medical research in developing new products and research approaches incorporating ‘big data’ and high tech innovation. Singaporean schools and universities are very strong and competitive in the STEM fields, which has led to many highly capable and ambitious young people pursuing careers in this area.

As the medical research commercialisation sector expands universities are now improving market and business knowledge among researchers with business education now being incorporated into some scientific programs. Nealda has identified a gap in the online education market and herself provides expert courses, resources and lectures for medical devices companies around all the complexities of successfully developing and launching new products.

Nealda has previously worked in a successful start-up herself and now organises networking events for medical technology entrepreneurs in Singapore. Such events enable attendees to make contact with

others in the sector, learn how to pitch for funding, meet investors and learn from the experiences of other entrepreneurs. We had a discussion about how she found the sector today and what the key challenges were. The business culture in Singapore is very supportive of entrepreneurs and commercialisation of research discoveries.

Specialised medical business accelerator programs have now been in place for the past few years. The Singapore MedTech Accelerator program is a private US-Singapore initiative devised to stimulate the medical device industry in Singapore. Nealda is affiliated with the Apple Seed Venture Accelerator medtech program which supports start-ups from Singapore and the Asia-Pacific and is backed by SPRING Singapore. Similar to Germany, many Singaporean start-up businesses often seek overseas investment partners, particularly in the US. SPRING Singapore is a government agency that seeks to promote more local investment for entrepreneurs through measures such as matched and leveraged funding programs, business accelerators and incubators, tax deductions and entrepreneur education for school students.

Another important Singaporean initiative that Nealda raised was the harmonisation of the often costly, confusing and lengthy regulatory approval process for drugs and devices in Asia. This regulatory harmonisation should lead to simpler and more cost effective approvals for businesses to launch new technologies to the market. Nealda was very excited and optimistic about the state of medical research commercialisation in Singapore and where the sector was going. Government measures are targeted at all aspects of enhancing research output and economic growth.

"Nealda has identified a gap in the online education market and herself provides expert courses, resources and lectures for medical devices companies around all the complexities of successfully developing & launching new products. "

Nealda Yusof, founder Semeogy.

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Recent developments in Singaporean and Asian biotech (Biotech in Asia)

Overview and Rationale

Laxmi Lyer is the editor and co-founder of the highly successful biotechin.asia website. Based in Singapore Laxmi has a PhD in virology from Nanyang Technological University, Singapore. Laxmi and the websites founding team all had a passion for scientific writing and following her PhD Laxmi decided to work-full time on the website. Since its launch in late 2014 the Singapore based site has grown substantially. Biotechin.asia attracts 25,000 visits per month, has 50+ contributing writers and many paid advertisers. Readers are from all around the world and it has received content requests from big players such as Nature Publishing. Laxmi very much has her finger on the pulse of everything biotechnology in Singapore and Asia.

Meeting

Laxmi and I had an interesting discussion about research program announcements in Singapore and across Asia, academic versus industry careers, collaboration with Australia and her exciting experiences running the website. Recent major news in the Singaporean research sector was the announcement of the new $4B Research Innovation and Enterprise (RIE) biomedicine funding package. This was the latest research funding announcement as part of the Singapore ‘Smart Nation initiative’. Singapore has invested heavily in its biomedical science industry and facilitated a supportive regulatory and business environment. Between 2000 and 2008 manufacturing output for Singaporean biomedical sciences has tripled from SGD$6B to SGB$19B. During the same period the number of jobs has doubled and private: public investment in R&D has grown impressively from SGD$1.70 to SGD$2.30. In addition to Singapore other countries in the region such as Indonesia, Taiwan and Malaysia are now increasing investment in biotechnology sectors.

Laxmi has written numerous articles about innovation and commercialisation news in Singapore. Specifically, a program she found particularly exciting was the Singapore-Stanford Biodesign (SSB) Fellowship. This highly competitive program is directed towards Singaporeans interested in the invention and early-stage development of new medical technologies. The SSB Fellowship Program is centred at Biopolis in Singapore and is administered as a collaboration between Stanford University, the Singapore Economic Development Board (EDB) and the Agency for Science, Technology and Research (A*STAR). During the fellowship, six months of the fellows’ time is spent at Stanford, and six months in Singapore.

Fellows work in a multidisciplinary team joining other innovators with a combination of engineering, medical and business back- grounds. The team examines clinical needs within the Singaporean and other Asian settings, identifying opportunities for medical technology innovation. Working closely with faculty, the teams invent, prototype, develop and patent one or more new technologies. Fellows are also mentored by “real-world” experts from the medical technology, legal and venture capital industries in the United States and Singapore. Fellows have since gone on to secure millions in privates funding for their highly promising businesses.

I asked Laxmi if Australian research or other medical news made much of a mark in Singapore. She said while she knew very high numbers of Singaporean students study in Australia, and personally knew a few, that Australian and Singaporean research collaboration could be strengthened. I strongly agreed and saw many potential advantages to this. Rather than focussing so strongly on the US, as Australia also does, there are benefits from regional partnerships that should be more closely examined.

Laxmi was passionate about the opportunities her new role outside the laboratory provides and the exciting directions the business is set to go. While challenging to manage the running of a highly visited news website she seemed energised by the exciting science she reports on, the passionate people she regularly encounters and the unique demands of managing a growing online business.

"Singapore has invested heavily in its biomedical science industry and facilitated a supportive regulatory and business environment. Between 2000 and 2008 manufacturing output for Singaporean biomedical sciences has tripled... During the same period the number of jobs has doubled and private: public investment in R&D has grown impressively..."

With Laxmi Lyer, founder, editor and writer for biotech.in.asia news website.

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Exploit Technologies Pty Ltd at A*STAR

Overview and Rationale

There are many factors that make Singapore attractive to large businesses and contribute to it being a leading industry and research hub in SE Asia. Singapore is very safe, English speaking, has a high standard of living and is easily accessible via its major airport to both US and European markets. Beyond that, specific government measures, such as the generous RIE funding program, place Singapore in the top 5 for biotechnology according to Scientific America 2015 rankings. A*STAR is Singapore’s lead government agency for scientific research with over 5400 staff from over 60 countries. A*STAR is one of the largest research organisations in the entire Asian region. The R&D program for A*STAR is strategically developed to promote investment and economic prosperity for Singapore. Critical to A*STAR’s commercialisation and industry engagement is the technology transfer office, (ETPL, Exploit Technologies Pty Ltd) which coordinates all licensing, spin out and industry R&D collaborations.

Meeting

At the futuristic ETPL offices on the A*STAR Biopolis campus I met with Mr Eugene Wee, Senior Vice President of Planning, Innovation, Network and Enterprise Division and the divisions senior manager, Ms Tan Hwee-Hoon. Our meeting commenced with Tan explaining to me the background of ETPL A*STAR, how the A*STAR R&D agenda is strategically determined and also what future plans and government funding are in place to enhance productivity of the agency.

The R&D programs at A*STAR are strategically engineered to achieve economic growth through targeted hi-tech market and industry creation for the country. The ministry of trade and industry determine the agenda and R&D commitment in order to stimulate growth is particular industry sectors. Often the R&D foci of A*STAR will target the enhancement of existing Singaporean production strengths and the differentiation and optimisation of existing products. A relevant example of this ‘value add’ approach is manufacturing of silicon chips for the IT sector. Singapore has traditionally been a major manufacturer of silicon chips and to maintain this position in the competitive Asian region A*STAR invested heavily in developing technological advancements for silicon chips, leading to consolidation of Singapore’s high-tech manufacturing role. This government-led approach to research prioritisation and targeted industry creation is distinct from the business driven programs that underpins most R&D industry-academic collaboration e.g. the case largely in Australia.

Strategic investment and careful planning from the Singaporean government have led to Singapore’s emergence as a prosperous and knowledge based economy. I was keen to learn what the next phase of A*STAR R&D had in store and where resources were being committed, particularly in the health and life sciences area.

Dandelion sculpture in Biopolis.

"Strategic investment and careful planning from the Singaporean government have led to Singapore’s emergence as a prosperous and knowledge based economy. "

Fortunately, my time in Singapore coincided with the announcement of the $19B 5 year (2016-2020) Research, Innovation and Enterprise (RIE) 2020 plan. Under the plan health and biomedical sciences will receive the largest share of funds (21%, or $4B) in funding. RIE2020 is Singapore’s sixth roadmap for research and development. The Singaporean prime minister Lee Hsien Loong chairs the RIE council and said in January 2016 “In the RIE2020 plan, we are making four major shifts to capture more value from our investments and research -to make research more effective and to get more results from them”.The health sciences focus of RIE 2020 will see major investment in research focussed on ageing and translational initiatives.With numerous multinational companies based in Singapore RIE 2020 intends to expand support to smaller scale R&D industry partnerships in particular with SMEs, start-ups and spin-outs. In order to turn Singapore’s investments into products, services and solutions measures will be implemented to nurture high-growth innovative sectors. Start up incubation resources are expanding with programs including SPRING Singapore facilitating this. Another is the Technology Incubation, business secondment program. To date over 400 researchers have spent time in around 200 companies coming up with R&D solutions and product innovations.

To maximise potential of ASTAR R&D commitments the organisation has learnt lessons into research commercialisation models within other highly skilled yet small countries around the world, such as Denmark, Sweden, Israel, Switzerland and the Netherlands.

A*STAR Success Stories

_HistoIndex: A journey from A*STAR and beyond

HistoIndex is a medical diagnostics imaging company spun off from A*STAR by two researchers. Dr Gideon Ho, Co-Founder and CEO at HistoIndex, was an A*STAR scholar and started his career as a scientist with the Institute of Bioengineering and Nanotechnology.

He later joined ETPL’s Biomedical Sciences division, before transferring to the Investment & Spin-Off Management division.

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As a commercialisation officer in the Biomedical Sciences division, Gideon was tasked with managing several Gap Funded projects to identify potential technology and expedite their market readiness for industry adoption. Having the opportunity to scout, evaluate and manage such projects enabled him to build valuable networks. That was when he met Dr Dean Tai, who shared the same passion, a similar temperament and aspiration for the technology. After a year of incubating a technology to produce an alpha-prototype, Gideon took the opportunity to learn to create business plans, understand the investor community and gain better insights on the challenges and intricacies of starting up a medical technology company.

In April 2010, Gideon and Dean incorporated HistoIndex. The company received a grant from SPRING and spent another 18 months to further develop the licenced technology into a beta-prototype. The total grant support for developing the alpha and beta prototypes amounted to about $1 million. With additional equity funds from SPRING SEEDS and angel investments totalling about $2 million, HistoIndex was ready with their first product called GenesisTM in mid-2012. That same year, the company made their first sale in China. Over the past three years, HistoIndex has grown from three staff to the current twelve. Revenue and income have exceeded $1 million after just two years of operation and the company is projected to grow its revenue by 50% in 2014. The assistance and support of ETPL and other government agencies have played a key role in spring-boarding HistoIndex’s services and products to the world. HistoIndex currently has offices in Singapore, Beijing, London and New York.

_AITbiotech

It was the close collaboration between Singapore agencies including A*STAR researchers, ETPL’s licensing officers, clinicians from Tan Tock Seng Hospital and committed team at AITbiotech Pte Ltd that enabled the joint development of the most comprehensive and rapid H5N1 Avian Influenza A real-time PCR assay in 2012. Within a few hours, the assay can rapidly detect all existing 52 genetic variants of the H5N1 Avian Influenza viruses and their respective sub-groups in a single test with almost 100% accuracy. The gold standard for H5N1 detection recommended by the World Health Organization (WHO) is only able to detect 3 out of the 10 distinct genetic variants. To detect all existing strains with this method would require several days and rounds of testing. With the AITbiotech H5N1 kit, early infection control interventions are possible in order to curb the spread of the disease, and enhance patient management in the event of an outbreak.

Although anti-viral treatment is available, the H5N1 Avian Influenza virus has pandemic potential. Therefore, the accuracy and speed of detection and identification of the H5N1 virus is essential for global preparedness. This was the second successful collaboration between AITbiotech, a local Molecular Diagnostic company, and A*STAR.

In 2010, the company acquired several molecular “We are proud to play a part in advancing medical technology in Singapore. Licensing these sophisticated assays from A*STAR gave us a springboard into the highly competitive market of Molecular Diagnostics. We are now able to provide a comprehensive suite of diagnostic services for a range of infectious diseases to the research, healthcare and biomedical industries in Singapore and Asia. SMEs can stay competitive by working with A*STAR to deliver products with direct societal benefits,” said Alex Thian, founder and CEO of AITbiotech. Diagnostic licenses from A*STAR for multiple pathogen detection and surveillance assays including the H1N1, Dengue, Chikungunya and Tuberculosis. These assays were developed at the A*STAR Institute of Molecular and Cell Biology and the Experimental Therapeutics Centre.

AITbiotech has successfully commercialised the assays under its abTES brand. These assays are now manufactured in AITbiotech’s ISO 13485 certified lab in Singapore. Most of the abTES assays have also been CE-IVD Mark certified. These assays give hospitals, labs and clinicians a time and cost saving tool to detect as well as to differentiate the nature and type of influenza or dengue infection with enhanced high sensitivity and precision. Proper diagnosis and treatment of patients directly benefit the health care sector in Singapore and the region in the fight against infectious diseases. The assays have generated sales and are being used in hospitals in Thailand, Hong Kong, Malaysia, Indonesia and Singapore. In Singapore, Tan Tock Seng Hospital is currently using the abTES Flu assays to screen and diagnose all Influenza cases, due to their high specificity, sensitivity and multiplexing capability. The collaborations between AITbiotech, A*STAR and clinical partners is a good example of how public and private sectors can partner to drive impact in Singapore’s healthcare and biomedical industries.

"Within a few hours, the assay can rapidly detect all existing 52 genetic variants of the H5N1 Avian Influenza viruses and their respective sub-groups in a single test with almost 100% accuracy. "

At the A*STAR ETPL head office with Tan Hwee Hoon & Eugene Wee.

The HistoIndex Genesis 200 provides quantitative, automated, stain free 2D and 3D tissue imaging.

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Conclusions

The components for a successful medical research commercialisation sector are consistent globally. They include world class researchers, discoveries and facilities, industry partners, a supportive and stable political and regulatory framework, capital and support for start-up businesses and incentives for entrepreneurs. Today, the Australian R&D field is well positioned to develop a wold-leading medical research commercialisation sector. However, to build on existing strengths, and improve Australia’s performance in medical research commercialisation, it is necessary pull the right levers. This process has begun over the past few years and is paying dividends.

One of the most limiting local ecosystem ingredients, start-up capital funds (specifically venture capital) has been strengthened with the establishment in 2007 of the Medical Research Commercialisation Fund. Backed by leading superannuation companies, the MRCF has now invested in 20+ spin-out companies, seen multiple leadng acquisitions and accelerated the impressive growth of medical start-ups into international businesses.

Overall, Australian VC funds have grown tremendously with $368M raised in the 2015 financial year - and in excess of $900M in new funds by April 2016. However, based on research from based on research from Harvard university and factoring in population size, Australia still has less VC funding than the USA and is ranked 23rd in the size of VC funds raised, behind New Zealand and Austria. In late 2016, a VC fund investing in CSIRO research discoveries will be launched to improve the commercialisation outcomes from Australia’s national science agency.

Other important ingredients, or levers, for incentivising medical research commercialisation in Australia include the R&D tax incentive for business and the TGA clinical trials notification scheme. From my fellowship travels, I have observed that there are additional opportunities to facilitate improved Australian medical research commercialisation.

+ Government seed funding. The allocation of a small proportion (e.g. 2-5%) of Medical Research Future Funds for research commercialisation activities can be a game changing sector stimuli and transform health innovations into reality. Small, non-dilutive investments in high-risk, high-tech spin-out businesses have the potential to generate new products or medicines, business growth, employment creation and ultimately significant market returns. Through mechanisms such as the Small Business Innovation Research program in the US, government investments can facilitate the creation of innovative, global businesses in a diverse range of high-tech fields. A strengthened R&D business ecosystem leads to decreased requirement for early-stage foreign acquisition or partnering to succeed, and promotes improved return on investment for Australia.

+ Education. Improved STEM education for children, as well as medical research commercialisation knowledge for researchers and scientists, will lead to greater awareness and capacity at both stages of training. STEM education in Singapore, in particular technology and computer coding, is especially strong and leads to a multi-disciplinary skills base for application in a range of high skilled careers. In Germany and Singapore researchers are well educated in the practicalities of translating their research into medical treatments. Improved understanding of research commercialisation processes (such as IP and opportunity awareness), patient benefits and research funding opportunities provided by industry will be beneficial for the next generation of Australian scientists.

+ Collaboration with industry. Medical research commercialisation is a team sport and occurs across borders and oceans. Australian researchers can no longer comfortably rely on government grants alone for their research to be funded. The pharmaceutical industry is partnering with academic researchers like never before. Applying for an industry grant, or pitching a mutually beneficial research partnership, can now be completed online, any time with a speedy outcome and a short proposal. Industry partnering and commercial activities, such as protecting IP, should become a recognised and rewarded aspect of academic activities, in addition to the strong focus on publications and citations.

+ Public Relations. It is often overlooked, but positive PR for Australian medical research and its commercialisation is imperative for garnering support from the public and politicians. Although both the sector and science are complex, and stories are seldom solely Australian, we should not be deterred from discussing and embracing the many excellent Australian commercialisation stories occuring.

Key References

www.aamri.org.au/

www.asmr.org.au/ExceptII08.pdf

www.ascenion.de/en/

www.astp-proton.eu/

www.ausbiotech.org/

www.biodeutschland.org/

www.chiefscientist.gov.au/wp-content/uploads/STEM_AustraliasFuture_Sept2014_Web.pdf

www.chiefscientist.gov.au/wp-content/uploads/OPS2-OECD-for-web-FINAL.pdf

www.csl.com

www.etpl.sg

www.fda.gov

www.health.gov.au/internet/main/publishing.nsf/Content/mrff

www.hudson.org.au

www.ibmt.fraunhofer.de/en.html

www.innovation.gov.au/page/national-innovation-and-science-agenda-report

www.kca.asn.au/

www.nhmrc.gov.au/

www.nsf.gov/eng/iip/sbir/

www.saworldview.com/scorecard/

www.sbir.nih.gov

www.smh.com.au/business/banking-and-finance/aussie-venture-capital-funds-triple-fund-raising-20160422-gocnzf.html

www.tga.gov.au

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