Developing a novel treatment for malignant mesothelioma
About us: Our proposal
AROMICS (www.aromics.es) is a privately-owned development stage pharmaceutical company founded in 2005, based in Barcelona and focused on developing novel first-in-class therapies for the treatment of human diseases. The company has already achieved different R&D awards from international, European, national and local public organizations (European Union, NCI, NIH, ICEX, CDTI, ENISA, ACC1Ó and MINECO). Our focus of interest is oncology and infectious diseases. As a result of our intensive R&D activity over the last years, the company received last year the seal of Innovative SME from MINECO.
The business model is to move validated inventive findings (protected under granted patents) up to early clinical stages (first-in-man efficacy Phase II). After completing clinical efficacy proof is foreseen a licensing out, co-development agreement or direct product sale to pharmaceutical industry. Revenues will come from dealmaking usually including upfront and milestone payments and royalty tiers. Usual multiply factor for similar investments are of x6.
Our most advanced antitumor drug candidate
Most advanced candidate in our pipeline is NAX035, a first-in-class, selective and potent compound for the treatment of cancer. The novel drug is currently completing regulatory preclinics compelling all the data required by the European Medicine Agency, seeking the approval for conducting Phase IB/II (safety and efficacy) clinical testing in patients.
Malignant mesothelioma has been selected as first indication for NAX035 to proceed into clinics due to the potency exhibited by the compound in this tumor type including both, pleural and peritoneal cancers. If effective, NAX035 will suppose a clear advance in the treatment of this rare cancer.
Malignant mesothelioma is a rare and aggressive occupational cancer linked to asbestos exposure, with a clear need of effective compounds
Malignant mesothelioma is an aggressive tumor arising in the lining cells (mesothelium) of the pleural and peritoneal cavities, as well as in the pericardium and the tunica vaginalis. With a natural history of 7 to 9 months if untreated and less than five per cent 5-years survivors, is a bad prognosis tumor representing currently 0,3% of total cancer deaths.
Malignant mesothelioma is an occupational cancer
The World Health Organization (WHO) has recognized that all forms of mesothelioma are strongly associated with exposure to asbestos, a group of minerals presents in nature highly resistant to heat and corrossion. Due its physical properties, asbestos was widely used by the industry including: construction, minery, navy, textile, motor or plumbery among others. However, the use was limited some decades ago, being a material currently banned in fifty countries, as it is considered as a first level carcinogen.
Moreover, in those countries were has been already prohibited like EU, asbestos remains still a challenge as there are still many buildings and industrial elements containing asbestos that require removal and disposal. A high cost removal plan that also puts workers and the community at immense risk. WHO estimates that around 125 million people are currently professional and environmental exposed. From them 10% eventually develop mesothelioma. Currently, more than 100,000 people die due to asbestos. The burden of asbestos-related disease will keep rising over the next years.
Therefore, "asbestos still represent a serious labour, public health and environmental problem".
Malignant mesothelioma is a highly-resistant tumour
Current treatment includes surgery, radiotherapy and chemotherapy. Surgery is the most effective option, although unfortunately aproximately 85-90% of patients are diagnosed at advanced stage where the disease is inoperable, and thus the treatment palliative. Survival time is of 6-12 months with a response rate to chemotherapy in advanced stage that do not exceed 50%. For this reason, we are looking for a new therapeutic strategy that substitutes the current treatment.
The new agents in development include targeted therapies, monoclonal antibodies and immunoncologicals. None of them has exhibited yet superiority versus the standard of care. It is mandatory to find new and efficient treatments for the tumor, both as first and second-line therapy.
NAX035, first candidate advancing to clinics
NAX035 is a small molecule that has shown efficacy in front a variety of tumors of different origins including the most prevalent types of malignant mesothelioma (pleural and peritoneal) both, in vitro (in tumor cell lines derived from human sensitive and resistant tumors to pemetrexed-cisplatin therapy) and in vivo (in experimental xenograft mice) when it is administered orally or endovenously. Moreover, it exhibited an appropiate safety and tolerability profile in experimenatl animals. The compound is easy to manufacture at an affordable cost, which is important for future market penetration.
Drug is currently completing preclinical package. Its pharmacologican and easy synthesis, make of NAX035 a good candidate for the treatment of cancer.
Malignant mesothelioma is a rare disease, and therefore, NAX035 represents a potential orphan drug. Working over an orphan designation confers certains advantages to small companies like AROMICS: it will suppose 7 years of market exclusivity, less development costs mainly due to the fact that clinical trials require less number of patients due to the rarety of the disease, less development time (in average 3.9 years for an orphan drug compared to 5.4 years for non-orphan drug), less regulatory barriers, some tax benefits plus R&D supportinggrants.
Why does it represents a business opportunity?
The estimated total cost for developing the first candidate up to efficacy in patients is about 6 million €. Three financial rounds are foreseen:
1ª.- A bridge round up to 500.000 euros for completing preclinical studies includin pharmacology and toxicology required for the regulatory agency to authorize the use of the drug in humans.
2ª.- A second round up to 2 million euros, to complete GMP manufacture and first-in-human trial (Phase IB: safety and dose range in patients)
3ª.- 3 million euros for Phase IIA (efficacy in patients)
What we require? CapitalCell crowdfunding
Our goal is to cover first part of this financial requirements with the goal to complete preclinical regulatory package, foreseen for the second quarter of 2017. Part of the 500,0000 euros required will be covered thru the crowdfunding with CapitalCell (300.000 euros at a minimum ticket of 1.000 euros), and will be completed with the co-investment of the current shareholders and the support of R&D grants already achieved by the company for the project
Why joining us?
AROMICS is a biotech company with a relevant number of R&D projects in different development stages characterized by a high innnovation capacity, novel technologies application and a sustained growing based upon the establishment of strategic allicances that has positioned internationally the company and allowed growing of new products of great potential for the pharmaceutical industry.
The business model is to move validated inventive findings up to early clinical stages (first-in-man) and licensing out to pharma companies that will drive the product up to the market. Revenues will come from dealmaking after clinical efficacy proof, Phase IB (safety and dose finding), or more typically after Phase IIA (efficacy in mesothelioma).
Return of investment. Exit strategy for the investors will usually be after completing a license out process, a co-development agreement or buy direct project selling with a Big Pharma company of the oncology sector once achieved the clinical milestone or by selling the product.
Typical revenues will come from upfront and milestone payments, and royalty tiers. As previously mentioned, typical deals (source: Deloitte RECAP) at this development stage are expected to reach up to 500 Million € and subjected to up-front payments (typically around 25-50 Million €) followed by milestone payments to mark successes and royalties on sales (12-15%) if the product ultimately makes it onto the market.
Break event of the project, will happen once completed the regulatory preclinical stage, and approval of the Regulatory Medicine Agency, at the entrance of first clinical test (Phase IB), where the financial round in foreseen. The different exit scenarios are depicted below:
Founder and CEO of Biohealth Management Inc (Boston, MA, USA)
Current member of the advisory board of different USA and European biopharmaceutical companies
Current associated partners
AROMICS is also supported by prestigious scientists in the area of cancer and novel therapeutic developments:
Other coworkers include :
Current malignant mesothelioma treatments exhibit low efficacy, thus it is required to identify an optimal therapeutic option for this rare disease. NAX035, is the first candidate proposed by AROMICS to advance to clinics. It is a syntetic derivative of berberine, a natural, well tolerated and safety compound, widely used in Chinese and Ayurvedic medicine with properties as antibiotic, atifungal and anti-inflammatory drug. In fact, the alkaloid is being evaluated clinically for the treatment of diabetes and cardiovascular diseases. Its properties as antitumor agent are less evaluated, although there are already certain literature articles around its use for breast cancer therapy. As anticancer agent, the effect is ubiquous and the efficacy low. However, the chemical modification of the structure of the alkaloid renders selective, potent, and specific compounds for the treatment of cancer
This is the case of NAX035, a small molecule that exhibits high efficacy both in in vitro and in vivo experimental cancer models, appropriate pharmacological properties (ADME: absorption, distribution, metabolism and excretion) and a preliminary good safety and toxicology profile. First studies performed with NAX035 has shown oral efficacy in the treatment of aggressive and highly resistant tumors such as malignant mesothelioma (both, pleural and peritoneal tumours), a rare cancer, with 100,000 deaths per year and little therapeutic options.
The mechanism of action of NAX035 is highly innovative: the compound bounds directly to messanger RNA of Thymidylate Synthase protein, silencing the expression of the proteins that is involved in the cell duplication process, and therefore, in the tumor progression. The block of the protein expression leads the activitation of cell death by autophagy. The singularity of the mechansim, makesof NAX035 the first compound of a novel anticancer class (“first-in-class").
Why is important in malignant mesothelioma?
The overexpression of thymidylate synthase is being clinically related to drug resistance to the standard chemotherapy treatment (pemetrexed-cisplatin) used to treat the tumor. A drug resistance process that can be:
Therefore Thymidylate Synthase protein levels is a predictive biomarker of response to Pemetrexed-based therapies. NAX035 is able to overcome this resistance and represents an alternative both as first, and second line of therapy.
Thymidylate Synthase (TS or EC 18.104.22.168)
Type of molecule
Mechanism of action
Post-transcriptional control: inhibition of the aberrant expression of TS in the tumour cell.
The whole development has been performed by AROMICS in Spain with the support of the Eurotransbio program (partially financed by ACCIO – with a total project cost for AROMICS of 241.584,67€ ) and a pID program from CDTI (total project cost of 329.551 €).
NAX compounds are currently being protected under granted patents in USA (US patent 8,188,109 B2, filed on 20.07.2009 and granted in US in May 2012) and Japan (JP 5,778,145 B2 patent granted in September 2015) entitled BENZOQUINOLIZINIUM SALT DERIVATIVES AS ANTICANCER AGENTS. Patent extensions include European Union (approved in November 2016) and International submissions (Canada, Australia and NewZeeland) filed beginning 2012, still pending. The patent is property of an Italian company (Naxospharma s.r.l.) to whom AROMICS maintain a strategic collaboration since 2011.
Aromics retains the rights over the Spanish patent and also an exclusive and worldwide license for the development of NAX035 compound and analogues for the treatment of all cancer indications. The license contract is adapted to the entry of private and risk investment capital. A novel patent for a specific indication and/or future patent extensions around NAX035 technology (production methods and/or pharmaceutical compositions) is expected in brief. Patent strategy (around newer patent, extension of existing patent and use patents) will be worked out during the project lifetime.
With an incidence of approximately 1.6 - 1.1/100,000 cases/year in Europe and USA, respectively, malignant mesothelioma is considered an “orphan disease” thus by definition, a treatment developed for mesothelioma is considered an orphan drug. The US market size with 3,000 people diagnosed every year and 2,500 annual/death. Between 1999-2010, it has been estimated 31,000 deaths related with the tumor. Since then, the number of affected people increases 5.4% yearly.
Without novel agents over the last 10 years, the global market for mesothelioma is valued in $210 million in 2015 with an annual growth rate of 4.1% raising up to $263 million by 2023.
The market is dominated by the sales of Alimta (pemetrexed), direct mesothelioma sales of $190 million in 2015 ( of total sales of $2,7 billion including also lung cancer). The lack of efficacy of Alimta in malignant mesothelioma and its current use anticipates the willingness to pay for introducing in the market novel and effective treatments for this orphan indication.
La estrategia de desarrollo de Aromics se basa en un doble pilar: acabar el desarrollo de NAX35 y al mismo tiempo posicionar esta y otras moléculas parecidas para el abordaje de cánceres igual de agresivos pero mucho mas frecuentes (como Pulmón, ovario, páncreas o colorectal.
Es por este motivo que contemplamos al mismo tiempo la licencia o venta de los desarrollos de la compañía y al mismo tiempo seguimos creciendo en la búsqueda de fuentes de financiación.
Naturalmente, los destinatarios de nuestros desarrollos deben ser compañías farmacéuticas que quieran invertir en el sector, que quieran seguir siendo actores relevantes o que quieran mantener posiciones de liderazgo.
Más adelante explicamos los posibles puntos de salida, pero siempre se producirán después de la consecución de hitos relevantes en el desarrollo del producto (PK/PD, estudio Fase I, estudio en Fase II). Estos acuerdos suelen organizar el pago en forma de un up-front (un pago inicial), pagos por hitos en el desarrollo y royalties en procentaje sobre las ventas si el producto llega al mercado.
Para alcanzar la prueba en humanos, el desarrollo constará de las siguientes etapas:
Una hoja de ruta centrada en alcanzar la prueba de eficacia en un tumor huérfano como el mesotelioma maligno con necesidad urgente de fármacos efectivos. Una vez probada esta eficacia en pacientes, AROMICS se centrará en desarrollar el fármaco para otros tumores prevalentes sobre los que ya ha iniciado las primeras pruebas:
The development plan for the most advanced indication (malignant mesothelioma), including operational and patent costs, for the 2016-2020 period is being structured as follows:
Year 1: 1.050.000 €
Year 2: + 1.000.000 €
Year 3: + 1.700.000 €
Year 4: +1.400.000 €
Following figures exhibits the use of the funds and the possible exit points for the investor
An innovative SME
AROMICS turns aroung its capacity of innovation (over 60% of the budget is devoted to R&D activities) and supported by its technological capacities to develop proof of concepts, to potentiate strategic alliances with other biotech companies for the codevelopment of novel products. Over the last 10 years, the company has capitalized on this expertise, being awarded numerous grants to work with consortia of organizations (for profit and non-profit institutions and research centers), to identify and validate targets, select and qualify leads, as well as complete proof-of-concept in vitro and in vivo studies and early toxicology and ADME studies, ultimately leading to INDs. working on this way, has allowed the company growing and mature its own product pipeline. AROMICS is currently identifying and characterizing candidates and leads for drug targets to be used in oncology and infectious diseases. Two of these compounds, a novel antiviral and a novel antitumor agent, are currently at preclinical stage.
All the activity of the company is reinforced by a wide network of collaborations worldwide, that include companies and research centres and hospital, that support the company on the development and commercialization of the products. Our commercial vision is driven by Biotech upside opportunities based on licensing, milestones and royalty agreements utilizing our intellectual property rights and prototypes, complemented by services for securing the growth of the company.
How our activites are being financed ?
the financial plan for the different R&D products of AROMICS has been financed by private investment of the enterprenours (432K€) supported with R&D inicitaitves from different public national and international organisms (>2Mn in 10 years of activity, that covered the initial steps of the development where risk was higher) soft and participative loans from CDTI and ENISA (966K€) and supplemented with R&D services to third parties that has contributed not only to the company finace but also the incorporation of technology inside the company. Until now, there is no external risk capital company, so AROMICS owns the 100% of its capital.
Preliminary work on NAX035 development has been developed in collaboration with the italian company Naxospharma with the support of publlic and private funds. These are the non-dilutive funds achieved by the project:
1. European Project (EU)
2. Spanish project
AROMICS is a 100% spanish company, privately owned. Current investors are the enterprenours. The investment so far isn 412.300 euros, and also has invested in 2015 and 2016, capital as participative loan to the society that will be converted in capital, when the present campaign is completed with the entrance of new investors.
Investment Plan for the period 2016-2020:
The capital rounds will be leveraged whenever possible, with financial instruments as R&D grants (Horizon 2020 Unión Europea, national and local programs) and participative loans. On this regard, AROMICS achieved in 2015, the seal of innovative SME with wide experience in R&D programs. In 10 years, the company has participated and lead over 20 projects supported by public organisms (EU, CDTI, MIneco and Acció among them). The project counts now with 4 R&D grants for the next two years, although none covered yet the clinical stages. .
It is foreseen a retorn of the investment as soon as the proof of concept in humans is achieved thanks to license, codevelopment or direct project sale to pharmaceutical companies at the beginning of phase IB/II taking into account the target market.
Pre-money value: 5.000.000 euros, to all investors – from risk capital until small investors.
Investment method: Increase in capital shares, formalized at the entrance of the external capital.
Investment modality: Investors will compromise to subscribe among them an agreement on vote syndication, designating a lead investor that will represent all investors in the board meeting.
Estimative profitability: a multiple of 5-6 times the investment in a 4/5 years landscape.
Profitability and return of the investment
Exit strategy is based on:
A) The achievement of a license, co-development agreement or direct sale of the project candidate to a Big Pharma of the oncology sector. The funds will be used to cover the development costs of the drug candidate NAX035, until one of the exit points foreseen. The most common way is through a license agreement that is usually organized in an initial payment (up-front), payments by development milestones and royalties (%) over sales if the product arrives to market.
Following figure shows some common agreements in the oncology area, for products at similar development stage.