Even with $20 million in freshly committed venture funds, Koronis Pharmaceuticals is determined to keep everything lean and mean. Founded in 1999, Seattle-based Koronis counts a staff of 16. Thatâ€™s more employees than you would find at a virtual biotech, but less than the full roster of researchers and business staff youâ€™d usually find at a more developed biotech company.
With that kind of head count, itâ€™s no wonder that the companyâ€™s interim CEO, Don Elmer, also wears another hat at Koronis: he represents the lead investor. And Elmer isnâ€™t making any apologies for economizing during the development stage.
"Pacific Horizon is the lead investor, and we at Pacific Horizon believe very much in capital efficiency,â€ says Elmer. â€œWe try to limit those organizations we invest in to technical and medical skill sets and provide management."
For now, though, all hands are needed on deck at Koronis as the biotech moves into a critical stage: A Phase IIa proof-of-concept trial for its one and only clinical-stage compound, KP-1461, an experimental therapy that may offer a new approach to HIV/AIDS. And if that therapeutic approach works, the same drug platform can be used to launch therapies against other hard-to-fight viruses.
â€œWe think viral decay acceleration is a platform mechanism that has broad applicability and we expect to announce an HCV compound this year,â€ says Elmer.
â€œViral decay acceleration differentiates 1461 from all other HIV drugs,â€ explains Stephen Becker, MD, the chief medical officer at Koronis. â€œThere are no other VDA drugs in the area, to our knowledge. All of the 24 approved HIV drugs work by inhibiting the virus. None achieve viral eradication. All of those drugs have to be taken every single day, or the drug level will fall and the drug can create resistance. 1461 doesnâ€™t inhibit a protein or viral entry. It doesnâ€™t inhibit the virus at all. It causes mutations to occur. For certain viruses like HCV, West Nile, HIV, big time viruses exist because they have high inherent rates of mutations. Too many mutations and they are no longer viable and the viral population can collapse. This was illustrated in drug form by Koronis in the late â€˜90s. Expose HIV to this drug and the virus becomes less and less viable as these mutations occur.
"In vitro data showed that viral ablation was irreversible. After drug exposure, the virus did not regrow. Whether that will be the same in humans remains to be seen. Itâ€™s conceivable that the dosing period would effect viral population eradication. The therapy may be able to be stopped or given intermittently."
In Phase IIa, Koronis will dose humans for four months.
â€œDepending on rates of enrollment, we probably would have an idea of the data by the end of this year or early next year,â€ says Elmer. â€œIf we have sufficient data, we would write it up for discussion.
Koronisâ€™ latest venture round--its fourth--provides the company enough money to get through Phase II, adds Elmer. And once some solid mid-stage data is available, heâ€™s ready to start some serious talks on a partnership deal.
Elmer has been the â€œinterimâ€ CEO for the past four years. Thereâ€™s no telling how long that arrangement might last, or what kind of CEO would ultimately be called on to lead the company in the future.
â€œQuite honestly, itâ€™s going to depend on the early results of the Phase 2 trials,â€ says Elmer. â€œItâ€™s quite likely that we may pursue future financing through partnerships. We found from other companies that the requirements for CEO are much different if you go down the IPO path.â€
Not that the IPO path is a likely way forward, though. Elmer isnâ€™t taking any options off the table, of course, but he also goes to some pains to point out that â€œwe donâ€™t believe that the IPO path is paved with gold.â€ The biotech IPOs that have come out so far this year have been anything but easy to pull off, and unless thereâ€™s a change in the environment, Elmer isnâ€™t touting a public offering as a likely method for raising more money.
Much more likely is a development pact with one of a handful of companies that are deep into the HIV space. And Koronis has budgeted time and money to putting themselves right on their radar.
â€œThere are four major pharma companies that own the HIV franchise, with another eight or nine that are aspirants,â€ says Elmer. â€œWeâ€™ve spent time with those companies making sure that they understand viral decay acceleration, to appreciate the results.
Of course, thereâ€™s no guarantee of a success in the trial. And with no other compound in the clinic to turn to, the companyâ€™s future will turn heavily on this next set of trial results.
"It depends on what that data looks like,â€ says Becker. â€œIf it extinguishes the virus, thatâ€™s an unequivocal success. If the safety profile is completely different than Ib, that could put an end to it."
Elmer takes the optimistic approach.
â€œWe would like to see this opportunity developed by methodically approaching other viral targets,â€ says Elmer. â€œWhether that occurs with Koronis as an independent entity or whether it occurs through a succession of licenses or an M&A transaction, I donâ€™t think we know yet.