Axikin opens a new chapter on respiratory research
When Boehringer Ingelheim moved in to buy Actimis Pharmaceuticals last summer, the German pharma company had its sights set firmly on an early-stage compound dubbed AP768, which was being studied as a novel treatment for asthma and allergic rhinitis.
The deal "essentially freed us from the obligation of having to do any development and the costs associated with that," says Kevin Bacon, who founded Actimis. The board stayed together to oversee the progress made on the compound--along with their $515 million in fees and prospective milestone payments--and everyone at the company was free to stay exactly where they were, continuing their work on respiratory disorders like asthma, allergic rhinitis and COPD.
From there, it was a straightforward process to launch Axikin Pharmaceuticals.
"We removed one program (which was sold to Boehringer) and had four left," says Bacon, who's now president and chief scientific officer of the fledgling venture. "We dropped one of those and continued with three. The Axikin setup was to take these other assets and run with them on a day-to-day basis. We have the same people, the same building, and just started with those assets."
Along with seven staffers, the new-old Axikin also kept a loyal group of investors. Last week, they announced a small, $3 million Series A. Sanderling Ventures led the round with additional investors that included Mitsui & Co. Venture Partners of New York. But Bacon knows that that figure is just an initial ante.
"According to our investors, this is part of our A round," says Bacon. "Anybody looking at this will realize that discovery doesn't go far on $3 million. We need to bring down additional tranches."
Those other tranches will be needed if Bacon is to stay on schedule. "Our current goal is to ensure we are in the clinic by 2010," he notes, "whether it's the first or second quarter is open."
Bacon is purposefully a little hazy on any timeline going forward, especially when you ask where the company will be once it burns through this $3 million.
"Like any discovery activity, we could have glitches or early successes in the process," says Bacon. "On this current round we will definitely be able to optimize what we have to the stage of clinical candidates and then see how much money we need."
One of the unknown variables is when the company can reasonably expect to start gaining collaborators to help fund its development. For now, Bacon intends to move compounds to early Phase II. After that, the cost of clinical development will start to exceed its budget, and partnering will become essential. Of course, it's also possible that partners could push a deal ahead of mid-stage development, just as Boehringer came in while Actimis' lead program was still in Phase I.
"Asthma is a target area in desperate need of novel drugs," he adds. And that unmet medical need could well inspire partners to step up earlier rather than later. "It's driven by the nature of the collaboration. I have no problem with these programs going back into industries at an earlier stage if the deal is right."
Bacon's biotech career has straddled the globe, from London to Geneva, on to Japan and now San Diego.
"Basically, all of these programs were extracted from Bayer HealthCare when Bayer shut down its Japanese operation," explains Bacon. "That's where I was. All the programs around inflammatory strategies, for asthma specifically, that was a mandate we had in that company when we started working." Bacon and his colleagues were also inspired to seek out other indications for the molecules they were working on. And the biotech hub around San Diego looked like the right place for a small developer to grow in.
"We knew the area," says Bacon. "It is a hub of very, very strong science and since we are small and have to outsource a lot of contract research, it seems a very smart place to do that. And we tap into the Burnham Institute on a regular basis."
Axikin is planning on a few more hires, but Bacon isn't planning any major expansions.
"We probably won't hire much," he adds. "We would like to grow with a few more bench scientists. We're in desperate need of people at the bench, and I'd like to expand with a few more."
At some point in the future, Axikin will have to choose among traditional paths: A public offering, if and when they return to fashion, growing independently on investment capital and partnerships into a large biotech or finding a buyer to step in and snap up the assets.
"My honest view is the latter: getting bought out," says Bacon. "We have a lot on our plate to handle, and given the economic situation I don't see expanding resource-wise to accommodate all the research necessary to make this a reality."