EDI’s promise and challenges

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Over a year ago, the University of Rochester, the University at Buffalo and the Roswell Park Comprehensive Cancer Center joined forces to create the Empire Discovery Institute. Its goal: to help upstate scientists bridge the funding chasm that traps early drug research, and send their discoveries down a pipeline to the pharmaceutical industry. 

But EDI has been a touch slow to get off the ground, principally because of changes at the top. Judith Dunn, a former vice president at the pharmaceuticals giant Roche, signed up as the nonprofit’s CEO last year, but left for another position within a few months. 

After an extensive search, EDI hired its current CEO, Martin Graham, who has more than 30 years in drug development at major players such as Johnson & Johnson. 

Graham, who is based in Rochester, speaks with pride and enthusiasm of the distance EDI has come since he took the helm on April 1. 

“We established a world-class advisory board,” he says. “We have all our … operational infrastructure in place—our legal, IT, finance structures.”

Officials at Roswell Park also are enthusiastic about the nonprofit.

“EDI is a great new model for supporting our innovators and stewarding some of our most promising projects, so we look forward to what this collaboration will achieve,” Roswell Park said in a statement.

That kind of enthusiasm could help EDI go far, but it has quite a few important tasks ahead of it, from bringing its website online to raising millions in additional cash.

Created in May 2018, EDI’s main mission is to select promising drug research programs from the three institutions, and provide the funding and expertise they need to advance beyond the early stages. 

“EDI is a new, innovative drug discovery translator that bridges between basic research that’s being conducted in academia and the pharmaceutical industry,” Graham says.

Source: EDI

Under the right conditions, those efforts could eventually lead to the creation of new medicines. 

“Some of these discoveries here could be groundbreaking new medicines that have implications across many different diseases,” Graham explains. “These could be diseases as common as cancer to rare and orphan diseases.”

Spawning startups

At the same time, EDI will use those research results as seeds for the creation of new drug development companies, adding to upstate’s biotech industry. The nonprofit expects to be able to name the first beneficiaries of its assistance by the end of this year. Empire State Development has provided $35.4 million to finance EDI, which will be parceled out over five years.

Drug development presents multiple challenges. According to the National Institutes of Health, it takes roughly 14 years to develop, test, refine and retest a new drug until it is ready for approval by the U.S. Food and Drug Administration and other regulatory authorities worldwide. The cost can reach $1 billion—or more. After the development process concludes, the drug still has to be manufactured, marketed, and accepted by the medical community for use in patient care.

That process might seem even more daunting when a research program stands a chance of disappearing into what scientists call the “valley of death” before it can produce an effective, marketable medicine. 

Martin Graham joined EDI as CEO in April.
(Photo by Mike Costanza)

“The ‘valley of death’ is really two things,” Graham explains. “There’s a funding deficit there, and there’s a kind of pharmaceutical-scientific expertise deficit.”

A number of factors cause the funding shortfalls. NIH, which finances a significant portion of early drug research, limits the purposes for which its money can be used. 

“It’s interested in both fundamental discovery research and research that might have an application,” says Steve Dewhurst, vice dean of research at the University of Rochester School of Medicine and Dentistry. “NIH’s mission is explicitly not to commercialize, not to bring (products) to the commercial market.” 

Dewhurst also heads the University of Rochester Medical Center’s Center for AIDS Research.

When the NIH money runs out, the academic researchers involved often can’t turn to an alternate source of cash, such as venture capital.

“The venture capital industry tends to like to invest in things that have a quicker turnaround, things like IT, software, entertainment, media and finance,” says Theresa Mazzullo, CEO of Excell Partners Inc., a state-funded venture capital fund and UR affiliate.

Pharmaceutical companies often won’t give an early-stage drug research program a glance, even when it has patented a chemical or drug that could become a marketable medicine down the line.

“They’re wanting to have some tangible products that have already been de-risked, that they can enter into their pipelines, and that’s usually several years upstream from where these kinds of opportunities are emerging,” Graham says. 

Lack of pharma interest also cuts the program off from another important asset: industry expertise in drug development, drug testing and the other parts of the creative process that commercialization requires. Combined with the absence of additional funding, that lack of knowledge and experience can send the program into a deep hole from which it might not be able to emerge.

A bridge to success

EDI was set up to provide the funding and technical expertise that academic researchers need get to get across that gap. 

Each of the three institutions affiliated with EDI has two representatives on its seven-member board of directors. UB president Satish Tripathi chairs the board, and Roswell Park president and CEO Candace Johnson, University of Rochester Medical Center CEO Mark Taubman and Graham are members. 

Altogether, researchers at UR, UB and Roswell are engaged in more than 200 programs that are of interest to EDI. The nonprofit’s success will depend upon picking the right ones to which to give assistance. Those will be selected by EDI’s 10-member Scientific Advisory Board.

“We’re bringing in not only the scientific and technical experts, but also the business and commercial experts from the pharmaceuticals industry,” Graham explains.

Chairman David U’Prichard is president of Druid Consulting LLC, which serves the biotech and pharmaceutical industries. The rest of the board’s seats have been filled by experts from around the country, and the United Kingdom.

The scientific advisory board has already begun looking over candidates for EDI’s financial and technical assistance. In order to qualify, an academic research program must meet specific criteria. To begin with, it must have made definite progress toward its initial goals. 

“These are fundamental discoveries that an investigator has taken, and there’s been a patent or a provisional patent that has been filed around that technology,” Graham explains. “That’s the starting point.”

The patent or provisional patent might only be for a chemical or drug-like molecule –the kernel of further research. Whatever form the original discovery takes, it should break new ground.

“Ideally, they’ve got some novel biology,” Graham explains. “Maybe it’s a mechanism associated with the disease, or they’ve developed some drug prototype that might modulate that disease.”

The treatment that the program has set out to produce must also meet an unmet need for patient care. Replication of existing medications is out.

“We want to be innovative, differentiated,” Graham says. “We don’t want to be developing a drug where theres’s 10 drugs already out there.”

Questions regarding the government regulatory requirements—especially those of the FDA—that the development process would have to meet would have to be answered. 

“If we develop a medicine in this particular route, is it going to take us 15 years to get to that point because of the regulatory hurdles that we have to overcome?” Graham says. 

If so, EDI might find that program less attractive. Finally, the research involved must be capable of producing a drug or potential drug that could eventually be commercialized. 

“There has to be a market opportunity that we can demonstrate,” Graham explains.

Once a drug research program has been approved for assistance, EDI will provide the financial aid it needs to help it make more progress. As it does so, members of the scientific advisory board will step up as needed to assist the investigators with developing the chemical or early-stage drug.

“How do we change this chemical lead and make that into a useful medicine?” Graham says. “We might be increasing how potent it is. Does it have undesirable characteristics that we want to, by changing the molecule, dial out of the equation?”

As a research program continues, it will need more dollars. To receive additional financial aid from EDI, it will have to continue to satisfy the nonprofit’s standards.

“We have very defined stages, with requirements that we’ve set to go to the next stage of funding,” Graham explains.

Under the right circumstances, the drug or potential drug involved will eventually be able to attract venture capital, and the financial and technical assistance of a pharmaceutical company. That money and assistance could take it further toward FDA approval, and eventually into the marketplace.

While helping early-stage research programs advance, EDI will also foster the creation of new companies that can make use of the programs’ discoveries.

“We want to spawn as many of these spinout companies and technologies that … we can grow and develop,” Graham says. 

Job creators

Over the long term, the spinoffs could increase the number of high-tech jobs in the Rochester and Buffalo areas.

Christina Orsi,UB’s associate vice president for economic development, views EDI’s role as a way to boost “Western New York’s reputation as a hub for life science research and innovation, while generating new economic activity through new companies, jobs and investment returns.” 

EDI has already drawn the attention of a number of Rochester-area medical researchers, including some who work at the Center for Aids Research. 

“We have a couple of investigators who are working on novel therapeutics for either HIV or complications of HIV, and the commercial development of those approaches could benefit from EDI,’ Dewhurst says.

The collaborative nature of EDI should be a plus for the three EDI partners’ drug research programs in general.

“There may be technologies and skills at one place that would be complimented by technologies or skills at another,” Dewhurst explains.

Graham says that during the last quarter of this year, EDI should be able to select the first research programs it intends to aid.

Though the transformation of early medical research into effective drugs can take decades, that process can be well worth the wait, Dewhurst says. In the 1970s, U.S. geneticist Howard Martin Temin discovered the enzyme reverse transcriptase, which is found in retroviruses. Temin shared a 1975 Nobel Prize for his discovery, but its effect reached beyond personal fame. 

“That fundamental discovery was the basis of all of the initial anti-retrovirals,” Dewhurst explains.

Anti-retrovirals are used in the treatment of HIV.

Work to be done

As laudable as EDI’s goals might be, the nonprofit has a lot of work ahead of it. To satisfy the terms of its state grant, EDI must raise an additional $12 million in matching funds within five years. Some of that can come in the form of in-kind services or other support from its partners, but the nonprofit will turn to outside sources for most of the money. 

“A very important element is what we’ll bring in in terms of outside external investment from venture sources, from strategic pharma partners who would be interested in investigating those programs, and also from philanthropic foundational support,” Graham says. “This will be an ongoing campaign.”

EDI also needs to pick academic research programs that will meet its standards in the long run.

“If we, for example, start 10 programs, we’d anticipate taking three of those through to a commercially viable opportunity within a five-year period,” Graham says.

Though he appears to have a great deal of work ahead of him, Graham relishes the challenge. 

“It’s an exciting venture,” he says. “I’m thrilled to be here.” 

Mike Costanza is a Rochester-area freelance writer.

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