After the agreement with Spark Therapeutics in October 2021, CombiGene is in a particularly favourable position – this much is clear in this year’s Q3 report. The stock exchange responded by trading up the share by 12 per cent. BioStock contacted CEO Jan Nilsson to get his comment on the report.
Biotech company CombiGene is developing two gene therapy projects, CG01 and CGT02, which are being developed for the treatment of drug-resistant epilepsy, and lipodystrophy, respectively – two conditions with a great need for novel therapies. In addition to finding a partnership for CGT2, the company’s ambition is also to broaden the portfolio by identifying new projects within indications with relevance to gene therapy.
Multi-million-dollar deal creates opportunities
The focus of CombiGene’s Q3 report for the year is on the company´s favourable position, mainly thanks to the deal with American biotech Spark Therapeutics in October 2021 regarding CG01. The deal established CombiGene as an international player in gene therapy, and involved an upfront payment of MUSD 8.5, and an additional MUSD 320 in future potential milestone payments – excluding royalties. Read more here. This has attracted attention from international pharmaceutical giants, improving the prospects for further license agreements – which the company is striving for.
Moving forward, CombiGene is also on a constant hunt for new interesting projects to develop, in-house or in collaboration with other industry partners. The strengthened financial position has had a significantly positive impact on CombiGene’s ability to do exactly this. The large deal also has the positive effect of increasing the company’s attraction to collaborations with smaller players in industry and academia.
Strengthening of the organisation
Furthermore, the company also highlights the building of a strong organisation as an important aspect of the quarter. In September, the company recruited Peter Ekolind who took up the new position as the company’s COO. Peter has extensive experience in the life science industry, which includes, among other things, the role as the Nordic manager at Getinge Group. Read more here. The company has also recruited Birgitta Ståhl, to the role of Senior Director In-licensing, which should increase the company’s opportunities to implement new gene therapy projects. Birgitta has extensive experience within pharmaceutical development, most recently from the company Oncopeptides.
CombiGene reports net sales of TSEK 5,213, which comprise of remuneration from Spark Therapeutics. The operational cash flow is reported at TSEK -10,412 (-48,542). The company was able to show strong cash and cash equivalents which amounted to TSEK 144,940 (66,087). This was received well by the stock exchange, which responded by trading up the share by 12 per cent.
To learn more about CombiGene’s business development and the ongoing work of finding more gene therapy candidates to in-license, BioStock reached out to the company’s CEO Jan Nilsson.
Jan, can you start out by highlighting the most important data from your latest financial report?
– Gladly! The very important epilepsy project CG01 has since October 2021 been advancing together with Spark Therapeutics with no costs whatsoever for us. For CombiGene, this has created a low burn rate which combined with the upfront payment from Spark of USD 8.5 million have created a strong cash position for the company. As you can imagine, a strong cash position is exactly what you need when scouting new projects to inlicense.
Moving forward, a potential licensing deal is very much a focus for you right now. In general, and maybe also in more detail, what you are looking for in new candidates to in-license?
– First and foremost, we are looking for projects that address great medical needs. Helping people suffering severe diseases or conditions is what CombiGene is all about. The second criteria is the commercial aspect, we need to see a commercial opportunity to move forward, either there is a large market as for the CG01 project, or a possibility to achieve orphan drug status, as with our lipodystrophy project CGT2. Going into more detail is difficult as there are so many different areas in which gene therapy can make a real difference.
In the search for new candidates, how is the scouting being performed?
– We are working in a number of ways. Recently, we strengthened our organization to have more internal resources to work within this area. I have already mentioned the recruitment of Birgitta Ståhl, who will be fully devoted to this task. The recruitment of Peter Ekolind has also meant that Karin Agerman, our Chief Scientific Officer, will be able to also work intensely on different aspects of our inlicensing efforts. We also use a number of external resources. With the help of students from Karolinska Institutet, we have mapped academic groups working with different forms of gene therapy and we continuously follow their work.
– Similarly, with the help of patent lawyers, we have mapped gene therapy-related patents in the Nordic and Baltic countries, which means that we have a good overview of the work being conducted in industry/academia in Sweden and other Nordic/Baltic countries. Of course, we at CombiGene are also active in finding new and interesting projects at conferences and within our personal networks – most of the people working at CombiGene are researchers at heart. CombiGene’s board of directors, which also includes trained scientists, also participates actively in the work of finding new projects. In addition to this, we have commissioned a consulting company to scout interesting gene therapy assets globally so that we do not limit ourselves to what is available in the Nordic region. Finally, with the help of a postdoc from Karolinska Institutet, we have also mapped out the interesting opportunities that exist among orphan drug candidates in the US.
What have you learned so far in your collaboration with Spark and in what ways will you use this knowledge moving forward?
– I would say that the deal with Spark verified our way of working in the development process. To be successful when dealing with Big Pharma, it is important that your project is being developed, and documented, in a way they recognize and feel comfortable with. It is also important to open up a data room quite early in the project so that interested potential partners can follow the development over time. Finally, I would like to stress the importance to allocate time to build trusting relationships with potential partners. Without the trust of the other party, you will never be able to strike a deal.
Finally, what are your hopes for 2023 and beyond?
– At the top of our agenda is the inlicensing of new projects. Our ambition is to build a broad project portfolio that includes projects in several phases of drug development, ranging from projects in really early phase to projects in pre-clinical development and thus contribute to gene therapies being commercialized and put to clinical use.The content of BioStock’s news and analyses is independent but the work of BioStock is to a certain degree financed by life science companies. The above article concerns a company from which BioStock has received financing.