Ablynx NV (ABLX-EBR)
September 18, 2009 Issue
The Most Powerful Name In Corporate News and Information
Ablynx NV Is A European Based Biotech That Has Used An Aggressive US Style Approach To Building Their Company, Raising Lots Of Capital And Bringing In Early Partners To Add Revenues And Help Bring Their Nanobodybased Drugs Through Clinical Trials
Ablynx, a biopharmaceutical company with headquarters in Ghent, Belgium, is engaged in the discovery and development of Nanobodies® to treat a range of serious human diseases. Nanobodies® are a novel class of antibody-derived therapeutic proteins. Because of their small size, unique structure and extreme stability, Nanobodies® combine the advantages of conventional antibody therapeutics with the key features of small-molecule drugs.
After completing his post-doctoral research in Germany, Edwin Moses began a commercial career with successful periods spent at Amersham International, Enzymatix and Raggio-Italgene. From 1993-2001, first as CEO and later as Chairman, he was responsible for the growth of Oxford Asymmetry (OAI) through a series of venture rounds cumulating in a flotation (LSE) in 1998 at a value of €175m (£120m). This was followed by a sale of the company to Evotec Biosystems in 2000 for €460m (£316m). During this period, OAI grew from 4 people to over 250. Over the past five years Edwin has played an important role at Board level (primarily as Chairman) in over 15 European life science companies. During this time he has been involved in financing rounds totaling more than €200m, a series of M&A transactions and three IPOs.
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFOinterviews.com, Published – September 18, 2009
Dr. Moses: “I finished a role with a company that was a started in 1993 and then sold for £316M in 2000; I was the CEO of that company. For a few years after that I took up non-executive director positions with a whole range of European life science companies, though not being involved in the routine running of the company. One of those companies happened to be Ablynx, where I became Chairman in 2004. I became Chairman with the intention of just running the Board. However, the CEO position became available and although I had not intended to move back into management I accepted the position. Of all the companies I have been involved with, Ablynx is by far the most exciting. I remember going home to my wife and telling here that this opportunity was coming and she said, ‘Well thank goodness for that, because this is the only company you ever talk about when you come home.’ It was just one of those companies that you sometimes get, where everything seems in the right time. The technology was right and the commercial opportunities were abundant. There was a great platform already in place to build upon and a good team around it. You don’t get many lucky opportunities like that, so that’s why I decided to jump in.”
CEOCFO: What is Ablynx about and what are Nanobodies?
“Nanobodies are based upon a discovery that was made in Belgium in the early
1990’s. The discovery is all around antibodies and most people know that we
humans have an immune system that protects us from invaders. So if we get
viral infections or whatever, the immune system creates molecules that are
specifically designed to fight that particular invader and those molecules
are called antibodies. It is an amazing system and allows us to fight off
all types of diseases. All mammals have that system and the whole idea of
antibodies has been used over the last twenty years by the pharmaceutical
industry to manufacture drugs. Some of the most exciting drugs such as
Herceptin, which is a breast cancer drug, are based on antibodies. There is
a $20 billion market now in antibody based drugs, using nature’s exquisite
capability to design molecules specifically to hit a particular target.
CEOCFO: How was it that they decided on using the llama to produce the Nanobodies?
“The story goes that a professor was actually running a med school practical
class in Brussels, and what that med school normally did was have the
students take blood from each other to analyze and see the various
constituents of blood. It was in the 1990’s when HIV AIDS was coming to the
fore and the med students said no. They did not want to take blood from each
other as they were nervous about doing that. The professor was adjacent to
the zoology department, so he went into the big cold storage room and found
some blood serum from a camel. So he took that and gave it to the students
to get the practical done and analyze the constituents. They saw all they
expected to see but they also saw what appeared to be these small antibodies
that nobody had ever seen before. Well the professor was a smart guy and
said that the med students could have made a mistake but if not it might be
something interesting. So he went and got actual blood samples from camels
and llamas and found that they all contained these small antibodies. What
has been discovered was that these groups of animals, the camelides,
together with two species of shark, are the only animals that produce these
small antibodies. Like all great science it is careful observation combined
with tremendous vision and creativity.”
CEOCFO: What are you working on, and why have you chosen to go after those diseases?
“The first drug that we are working on is an anti-thrombotic. So it is a
drug that is used to prevent clot formation in blood. We have a program that
is just about to go into Phase II clinical trials and we have already
treated healthy volunteers to ensure the drug is safe and we have treated
patients as well. A particular protein called von Willebrand Factor is
involved in clot formation in arteries which can lead to a heart attack. So
we are able to inject llamas with that protein, get a Nanobody to bind to
that protein and use that in development. What we are taking advantage of is
the very specific nature of the Nanobody, so it just targets the von
Willebrand Factor. It doesn’t interact with any other target and so doesn’t
appear to cause any side-effects that you would not want. We are also able
to produce it in E.coli, a simple bacteria, and it is very easy to
manufacture. In addition, we’ve been able to do these studies very quickly,
so going from the initial idea that we would like to investigate this
protein it has just taken us just 4½ years to get into the Phase II clinical
trials which compared to any other approach is extremely rapid.
CEOCFO: You say that you’ve adopted a progressive strategy; what do you mean by that?
“I think there is quite a difference between biotech companies in Europe and
biotech companies in the US. In the US, there have been some huge successes,
such as with Amgen and Genentech, but we haven’t seen that type of success
from companies in Europe. Part of the reason is because there has been too
conservative of an approach by European companies. The US companies are
generally more optimistic, aggressive, raise more money, and have given
themselves the very best chance of success an the industry, where you might
find as many as eight or nine out of every ten projects will fail. We think
that our failure rate may be better than that but in any event, you will
have a lot of projects in research that will not make it to the market;
therefore you need lots of projects ongoing at any one time.
CEOCFO: I noticed from your results that you have grown your internal resources; what have you done, how have you strengthened the company, and how will you continue to do that?
Dr. Moses: “Key internal resources for companies like us are people. We have just over 220 staff. We benefit in Belgium from the huge diversity of the labor force. If you take our senior team of five people, the executive team that run the company, it comprises three women and two men. To my knowledge, we are the only public biotech, both in Europe and the US, where the majority of executives on the team are women. There are also five different nationalities within that team, so we have a Brit, Swede, German, Belgian and American. That diversity flows right through our company. Currently we have 14 different nationalities and we really believe Belgium is a fantastic environment to attract the best talent from around the world. We build on that, as we really like the idea of bringing people in of different cultures, different educations and mindsets, who all approach problems in different ways, and so can come up with the best solution. In addition, facilities are important. People don’t often talk about that, but in our business you have to have the specialized laboratories that you need, because otherwise you simply can’t do the work. So again, we have benefited from the local environment in Belgium, which is extremely supportive of fast growing companies. They have provided facilities that have allowed us to go from 50 people in 2006 to 220 people now. We are about to move into a new building that a local consortium has funded, so we don’t have to outlay any capital. We just rent the facilities, but we are able to tailor them to our particular needs. It is a very favorable local environment which recognizes the need to grow quickly, the need to have flexible space and provide it at a reasonable price, and this is exactly what we need to help us drive our company forward.”
CEOCFO: Address potential investors, why does Ablynx stand out?
“Ablynx stands out because it is what you might call the next generation in
the antibody area, which is a relatively new class of pharmaceuticals, where
there are already products on the market generating annual sales of more
than $20 billion. Classical antibodies are a great new class of drugs, but
they have disadvantages as they can be difficult and expensive to make and
they can usually only be delivered by injection. People have therefore been
looking for “next generation antibodies” which can overcome these
disadvantages. We believe Ablynx is a leader in this “next generation
antibody” space. So we are able to build on the great success of antibodies
quickly and cost-effectively to develop products with tremendous potential.
CEOCFO: And you have the background to do that!
Dr. Moses: “Yes!”
CEOCFO: Many companies don’t, so that is an important factor!
“I think it is an important factor. One of the things that the
company did well, and plays to the strength of the original CEO, is that he
and the Board realized in 2006 it was time to change the management team in
preparation for a new phase for the company. The advantage I had coming in
as a relative newcomer was that I could be more objective and there was no
danger that I would be too much in-love with the technology not to make
tough decisions with regard to strategy and projects. So bringing in a new
team at that point meant that it was very easy for the team to not be
emotionally attached to things and just make business-led decisions on what
really was going to create the maximum value for investors. It speaks well
of the Board and the previous CEO that they realized that was the right
timing to go forward. This allowed us to create a new team. We now have our
Chief Business officer who is a lady called, Eva-Lotta Allan. She was
formally with Vertex Pharmaceuticals of the US, very experienced in doing
international deals and since she has come to the organization, we have done
four major collaborations. So we have people who have done it before,
developing private and then public companies, and who also understand how to
collaborate with other companies. You are right, we do have experience!”
“What we have tried to do is develop an organization here in Europe where we are learning from some of the best aspects of the US biotechs. We have raised money aggressively - €70M in venture capital followed by an €85M IPO in 2007. We recently announced our results for the half year and we still had over €101M in cash. So we are one of the better capitalized biotech companies in Europe. Our strong cash position enables us to ensure that we partner programmes when appropriate and are not forced to do so at too early a stage.” - Edwin Moses Ph.D
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