Masters of the patent game

January 16, 1998

Sue Foden, head of the Cancer Research Campaign's technology transfer arm,tells Kam Patel how its income has grown tenfold in a decade

In the early 1980s there were precious few biotechnology firms, university industry liaison officers were rare, and "technology transfer" had yet to become quite the buzzword it is now.

Sue Foden witnessed the transformation that made them more common while head of academic liaison at Celltech, one of Britain's first biotechnology companies. The firm was set up in 1981 to ensure that the fruits of government-funded science was commercialised. But now, as chief executive of CRC Technology, the technology transfer arm of the Cancer Research Campaign, she points to yet more upheavals in recent years in the way medicine-bound research is practised and taken to the market. And the cancer charity is determined to keep abreast of these changes.

In September 1996, CRCT spun off a new company, Cyclacel, in partnership with academics at Dundee University and Merlin Ventures, a biotechnology investment firm set up by academic turned entrepreneur Chris Evans. The formation of Cyclacel, which specialises in developing new approaches to cancer treatment, is a first for CRCT and several other similar ventures are in the pipeline. For Foden, who joined CRCT in 1987, the spin-offs are an indication of a move away from "traditional" CRC activity: "It used to be pretty straightforward - you have a drug, you find a suitable pharmaceutical firm, give them a licence to take the drug to market and wish them good luck. But that is happening less and less now. The science is changing and coupled with that there has been an explosion in the number of biotechnology firms."

But to take a promising lead to the market takes time, money and resources which small biotechnology firms are unlikely to have. At the same time, drug companies are looking to forge stronger links with biotechnology firms to access novel research. And biotechnology firms in turn are looking to the academic sector - from which many emerged - for ideas. The biotechnology ventures have carved out a niche as the middlemen between university science and pharmaceutical firms, although some of the bigger ones are hoping to become pharmaceutical forces in their own right.

The restructuring of the industry is linked to developments in science, particularly molecular biology. New, faster laboratory techniques have also come on stream; traditional chemistry, for instance, cannot compete with combinatorial chemistry and mass screening of molecules, thousands of which can be produced and analysed in a week using these new methods. Consequently, interest in the output from universities has shifted from new molecules - the basis of new drugs - towards the identification of "targets" like genes, regulatory proteins and enzymes associated with certain diseases. These highly specific targets direct the design of molecules or drugs needed to alleviate the disease.

Biotechnology firms are interested in getting their hands on these targets from academics so that they can validate them and then produce molecules to be sold to big pharmaceutical companies. Foden says: "The science has changed, the business has changed and so what we are doing at CRCT has had to change. Instead of being presented with molecules we are being presented with targets, the beginnings of a drug, and the business of protecting them is a whole new ball game."

Rarely is it worthwhile, though, going directly to a pharmaceutical firm with these targets: they are of little value on their own. The option is to take the targets to a biotechnology firm, or begin spinning off new companies like Cyclacel to make patentable molecules. "This development is exciting. It seems the best way to get from concept to treatment is to have focused ventures," says Foden.

CRCT, established in 1987, is the successor to Carlton Medical Products, the Cancer Research Campaign's first foray into technology transfer, launched in 1982. The charity's total income for 1996/97 passed Pounds 75 million for the first time, with voluntary income up 14 per cent to over Pounds 52 million. Total research spend is over Pounds 49 million of which Pounds 44 million is allocated by the charity's science committee, which is charged with funding research to meet the CRC's objectives. The CRC accounts for a third of all UK spend on cancer research and over three times the amount provided by the Medical Research Council.

Nearly all CRCT research funds go to universities, research institutes and medical schools. "It is not necessarily blue skies research," says Foden. "There is a fundamental difference between CRC and other cancer charities in that we place much more emphasis on the downstream, near-to-the-patient activity. And that means, for instance, clinical trials and helping those with cancer now."

While the committee decides how to spend the campaign's research funds, CRCT's task is to keep an eye on developments in research funded by the charity - with special interest in what might be patentable, exploitable and could advance cancer knowledge. "CRCT's job is to pick things up and make sure they do not get lost. Because once it is published without any patent property on it, it has lost a lot of interest. Glaxo Wellcome, for instance, probably would not want to develop something that has not got patent protection." It can take ten years and cost Pounds 100 million to get from promising work by a researcher to a product which can be made available to people.

CRCT keeps in close touch with researchers it funds and the company expects them to get in touch when an important stage has been reached in their work. "When they do, we tell them to keep quiet. We go and see them and then file for patent protection." Researchers are given lectures in advance by CRCT on the basic principles of gaining protection. Sometimes, a pharmaceutical firm, one of whose scientists has met a CRCT researcher at a conference and knows of the academic's work, will try to access the research directly. Foden says: "We can liaise between the two but we can also tell the firm to go away, that we are not ready to talk to them yet. It happens a lot. Most of the time it is fine but you have to make sure you do not get ripped off."

Having filed a patent, say on a promising molecule that could lead to a new drug, CRCT has to decide whether it can add value to it to make it more attractive for further development. CRCT might for instance decide to use the charity's resources to take the development all the way to phase one clinical trials - getting it into humans - before approaching a pharmaceutical firm for further development. By doing this, industry might not only be a lot more interested in the molecule but it would also be worth a lot more to CRCT.

Typically, a deal with a pharmaceutical firm will involve its taking ownership of patents and it would be its responsibility to take the drug through all later clinical trials. If the drug gets to the market, CRCT will get a royalty, typically 4 or 5 per cent of sales. CRCT in turn will share the royalty roughly equally with the original researchers' institution.

Foden stresses that the main aim is to get the fruits of the research to the patient: realising a return on the campaign's investment is secondary. "Even if it was a drug aimed at the Third World and we were not going to get much money back, we would do our damnedest to get it to the market if it was going to benefit people. A drug firm is unlikely to do that; it would abandon it because the market return is not good enough."

CRCT has grown rapidly with total income rising from Pounds 100,000 in 1987-88 to Pounds 3.5 million in 1996-97. Over the past five years income totals Pounds 15.5 million. Of this just over Pounds 7 million came through sponsorship of research from firms and was directly remitted to the university or research institutes where the work was carried out. The firm's sharing of royalties and licence fees with researchers has pumped over Pounds 2 million into the research community over the past five years.

CRCT is hoping it will be in a position to benefit from a solid, long-term market-driven royalty stream within the next few years through, for example, Temozolomide, a promising treatment for melanoma (skin cancer) and glioma (brain cancer). Developed by a team led by Malcolm Stevens at Aston University's CRC Experimental Cancer Chemotherapy Research Group, it is being taken to the market under the trade name Temodal by pharmaceutical firm Schering-Plough.

Clinical trials should end soon and Schering-Plough is hoping to register it in mid-1998, initially for the treatment of melanoma.

Foden says CRCT is financially "quite healthy". Pointing to the long lead time for the developments of drugs, she says the figures are good for a company which has not yet got a drug on the market. "We have had to earn our bread and butter by going to pharmaceutical firms and selling something, like licensing deals. Temodal is not only a success story of original research being taken to the market; once the drug is on the market, CRCT could receive royalties for up to 15 years without it having to do anything."

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