OUTSOURCING Find the funds
Roger Nolan, president at BioKier, and Doug Cary, president and CEO at Cary Pharmaceuticals, explain successful approaches for early stage clinical trial funding.
iotechs that have progressed as far as clinical trials have obviously de-risked their assets to some degree. Reaching phase I means lead optimisation, in vitro and in vivo preclinical efficacy has been demonstrated, safety in animals has been established, and the final product has typically been manufactured with demonstrated purity and reproducibility. All this takes capital and suggest that the biotech is beyond the start-up stage, having raised seed capital and perhaps series A. Filing an investigational new drug (IND) application is a creditable milestone, but not nearly the value inflexion point with investors that it once was. Investors and strategic partners increasingly want assets de-risked to the point of clinical proof of concept. Biotechs, therefore, have to be creative in approaching funding for clinical trials.
B
Important preparation Important determinants in preparing requests for capital are clinical indication – size of market
and medical need – competition, regulatory hurdles, experience of the management team and applicability of preclinical efficacy data. In some authors’ experience, funding for early stage clinical trials came from a combination of self-funding, angel investors, loans in the form of convertible notes from state life science economic development organisation and venture philanthropy, and grants from the federal government and research foundations. In our case, the majority of funding for phase I and II trials came from grants from the National Institute of Health (NIH), with a minor amount from research foundations. NIH grants are obviously very favourable because of the amount of money that’s available and the non-dilutive nature of grants. Drawbacks of the grant approach are time and effort in preparing applications – an approximately 12-month application and review cycle – inconsistency and varied experience of review panels, and the low-percentage of
24 || Outsourcing in Clinical Trials Handbook
Outsourcing in Clinical Trials Handbook
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