As announced last week, this is the first in a series of interviews with people who make a difference in the Pharma, Biotechnology and medical world.
Alain Moussy is CEO of AB Science, an emerging French biotechnology company. As previously reported on this blog, AB Science gained EMEA approval in 2008 for its novel tyrosine kinase, masitinib, in dog mast cell cancer. This product was launched to vets throughout Europe earlier this year and is awaiting FDA approval. Masitinib is also in phase 3 human clinical trials in GIST, mastocytosis and pancreatic cancer for which the EMEA has granted orphan drug status.
Pharma Strategy Blog: Could you tell us about yourself and how you came to start AB Science in 2001?
Alain Moussy: I met a great team of researchers and physicians, and we decided to build a company around tyrosine kinase inhibitors for oncology and other diseases. Compared to big pharmaceutical companies, our goal has been to come up with the safest tyrosine kinase inhibitors, and the first one we have is now available in dogs and we hope will go all the way in humans both in oncology and outside oncology.
Pharma Strategy Blog: Why did you start off with a drug for dogs?
Alain Moussy: We think that that dog is a fantastic scientific platform for humans and is also a shorter time to develop, so you can go to the market earlier, which is good when you don’t have any revenues.
Pharma Strategy Blog: What is your vision for AB Science?
Alain Moussy: This business is about making drugs that really make a difference for patients. Pharmaceutical companies, however, have the constraints of having to make a return for the benefit of their shareholders, and so 90% of the time they develop a drug that is not that effective but is safe. This generates revenue that sustains their sales force and high cost structure. We at AB Science are here to make new drugs that radically change the life of patients by surviving more in cancer, or reducing symptoms in chronic inflammatory disorders. Our vision is to make new drugs that make a difference.
Pharma Strategy Blog: Many biotechs have pursued alliances or partnerships with large pharma companies, why has AB Science publicly said it has no interest in this?
Alain Moussy: Biotechs are owned by venture capitalists, who have a 5 to 7 year cycle to make money, but the cycle of drug development is 10-12 years, so in the middle of the cycle they have to sell where the risk is not too high. Typically, venture capitalists do not care whether the product ends up being approved or not. Most biotechs end up following this strategy because they are owned by VC firms.
AB Science is owned by entrepreneurs, and we have chosen to dedicate our life to developing products that make a difference. We have to stay independent, because if we try to make money in the middle of the drug development cycle, then we will just select drugs that we can sell to a big pharma, and this is not what we want. What we want is stability for the long-term to have time to take the necessary risks to make the right products. We take a lot of risks everyday because it is the only way to find the right drug. We don’t think we need to partner with anybody because we know how to develop our drugs and that is what we did in dogs.
Pharma Strategy Blog: How do you feel about going up against large companies such as Pfizer?
Alain Moussy: In dogs, we obtained the first approval in Europe for a drug to treat cancer in animals, ahead of Pfizer Animal Health. We are competing against them, and we will see who has the best product. Pfizer based their regulatory submission on a clinical trial with only a 6-week end point, while we have follow-up data after 150 weeks showing a significant increase in survival. We think our product is very specific and safer and that based on the data, it offers a greater benefit/risk.
The other important thing to note is that last year Pfizer spent $10 billion in R&D with no new chemical entity registered, and AB Science had one. It does not cost $1B to develop a new drug, as that is the cost of failure integrated into debt. If you go to a very severe disease with the right product, you can do it even if you are small.
Pharma Strategy Blog: How have sales of masitinib for dogs gone in Europe?
Alain Moussy: Sales are picking up and because they like the drug, orders are repeating. That is the sign of a good drug. The profit generated by the veterinary business, although limited, will be invested back in R&D.
Pharma Strategy Blog: Where do you hope to go after Europe?
Alain Moussy: The United States is the next target for dogs and we are very close to registration. Besides that there is Canada, Australia, South Africa, South America and Japan. There are a dozen or so countries that are of interest for dogs.
Pharma Strategy Blog: When is approval likely in humans?
Alain Moussy: In humans, we don’t expect approval before end of 2011, with sales in early 2012. If our phase 3 trials are positive, we will register in the US and Europe at the same time. The earliest approval will be in pancreatic cancer. GIST is a long-term play because it is difficult to recruit.
Pharma Strategy Blog: Where do you see masitinib being used in humans, will it compete against existing products?
Alain Moussy: In pancreatic cancer, the positioning of our product is in addition to gemcitabine. In vitro masitinib has been shown to reverse resistance of pancreatic tumor cell lines to gemcitabine. Our product is unique in its ability to resensitize the pancreatic cell line that has become resistant to gemcitabine.
In phase 2, the survival rate at 18 months was 28% with no difference between metastatic tumors and locally advanced. From an analysis of 45 other studies, the current survival rate at 18 months is 6-8% in metastatic, non-resectable tumors. In our study, 28% survived. This is a major difference, but sometimes phase 2 data is not replicated in phase 3, but that is the magnitude of the hope we are carrying. Many large companies have failed in pancreatic cancer, so if we succeed this will be big news for us and for pancreatic cancer patients who, unfortunately, die rapidly.
Masitinib is able to resensitize other cell lines with other chemotherapies, so it has a generalist mechanism of action that can be used in many cancers, so we are doing clinical trials in e.g. prostate, CRC, NSCLC, breast, and multiple myeloma. We get very good results in-vitro, which we hope to replicate in-vivo in humans and dogs. This is why masitinib is fascinating in oncology.
In the GIST indication, we will not compete against sunitinib since our product is not positioned in resistance to imatinib, but we will compete directly against imatinib. Our phase 3 trial is head to head against Glivec/Gleevec. We will see what results we have at the end.
Pharma Strategy Blog: Les Echos published a report earlier this year that you planned an IPO in early 2010, is that still planned?
Alain Moussy: The market for IPOs was closed, but is re-opening. AB Science is a candidate for an IPO next year and we will do that in Europe, not in America. We plan to use the money we gain from an IPO to invest in clinical trials. The IPO will take place before we know the results of our phase 3 trials, so I hope that people will in invest in the hope of what masitinib may be able to do.
Pharma Strategy Blog: What are your plans post IPO?
We hope post IPO to deliver positive results in one of our phase 3 trials, which would allow us to register the drug in humans. If that happens then since it is a specialty business product sold to hospitals and not general physicians, it is likely we will keep ownership and distribute the product ourselves, which means we will make high margins in markets that are worth billions. In that case, it is likely AB Science will become big, which we are not today.
Pharma Strategy Blog: Does AB Science have other products in the pipeline other than masitinib?
Alain Moussy: We have a platform of new products, which have not been developed yet. In order to keep control of the company, we have limited the amount of money we have raised so far. After the IPO we will invest in developing these new products.
Our approach is to invest in one compound at a time, because if you have multiple indications with one compound you have economies of scale. If our development cost for one compound in multiple indications is roughly €200M in man, this would be €800M if instead we had one compound per indication. So our strategy of one compound for multiple indications, which some people think is risky, saves us €600M.
Pharma Strategy Blog: Do you have to spend a lot of time with your institutional investors explaining your strategy?
Alain Moussy: We have refused many venture capitalists because they did not share our strategy. We selected the shareholders of AB Science on the basis of sharing the long-term strategy of the company. There is no conflict with them because they agreed at the beginning to give us the time and independence to develop drugs that change the lives of people.
Pharma Strategy Blog: Finally, looking back on your experiences over the past eight years, what advice would you give to other biotech entrepreneurs who wish to follow you?
Alain Moussy: Coming from the retail industry at Carrefour, I was totally ignorant of the difficulties. Bringing a drug to market is an incredibly challenging, difficult and positive job helping save people’s lives and there is nothing better that I could have done in my life. Science needs entrepreneurs because science needs to take risks. The lesson of entrepreneurship is when you do believe in something, you should not try to measure the effort but just do it and that is what we are doing.