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National Multiple Sclerosis Society Creates Program to Translate Research to Therapies

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Timothy Coetzee
Executive Director, Fast Forward
National Multiple Sclerosis Society
NAME: Timothy Coetzee, executive director, Fast Forward program, National Multiple Sclerosis Society
 
BACKGROUND: Vice President, discovery partnerships, NMSS, 2006-2007; Various research-related management positions, NMSS, 2000-2006; Instructor, University of Connecticut Health Science Center, 1999-2000; Postdoc, University of North Carolina at Chapel Hill, 1993-1999; PhD, Albany Medical College, 1993.
 

 
The National Multiple Sclerosis Society last week launched a program aimed at bridging the gap between university research and commercial drug development in order to speed the commercialization of new treatments for MS.
 
Dubbed Fast Forward, the program will be a wholly owned subsidiary of the NMSS, and will identify, evaluate, and partner with existing start-up companies to develop new therapies or repurpose existing drugs for treating MS.
 
The program has already secured $4.5 million of the $30 million it intends to raise over the next six years, is currently evaluating business proposals, and plans to make initial investments early next year.
 
Last week, Timothy Coetzee, director of the program, spoke with BTW about Fast Forward.
 
How did this program come about?
 
The National Multiple Sclerosis Society has been around for about 60 years. We fund about $40 million a year in university-based basic research, as well as training of scientists, and so on. About a year and a half ago we started looking at the fact that we were spending a lot of money on research, but drug development for MS did not seem to be keeping pace. We wondered what structural and financial issues might be keeping what we would consider an adequate amount of drugs in the pipeline for MS. There are six approved therapies, what we call disease-modifying therapies, and they’re great. But they are expensive therapies that are partially effective for some people some of the time. They’re not effective for all people with MS. They have side effects and issues that might cause people to discontinue the therapies.
 
We noted a gap between the good ideas that are generated at the university and their development into early-stage companies, or what I call translational research. This is taking a possible treatment and then doing all the development work – the preclinical validation, the validation in animal models – to take it into human clinical trials. For most drugs these days, and definitely for MS drugs, that process frequently happens in very young, early-stage companies.
 
When we looked into what was causing this gap, it was funding. Some people call it the ‘valley of death.’ Venture groups aren’t particularly inclined to go early stage, because they’re looking for a clinical validation so that they can get a return. I don’t have a problem with that. I recognize that they have limited partners that have demands. They want their money and they want their returns. They probably have your and my retirement plans in their funds. You have a situation where you have a long timeframe for development and payout, and a lot of risk associated with neurological drugs. Something like one in 10 drugs is successful, at best.
 
And when we looked at what is in development for MS, and for other diseases, we were disappointed that as of two months ago, when we finished this analysis, there were approximately 160 MS drugs in development. Most of those are in preclinical and won’t make it. This lags behind other diseases such as blood cancers, ALS, and Parkinson’s. We believed that we had to try to change that for people with MS.
 
When we stacked those odds, we wondered what we could do as an organization, and we looked at how other non-profits have successfully tackled this problem. We zeroed in on putting some of our capital in to support that very early-stage research. It could be a group that has taken an idea and is starting a company and beginning to do the first stage of preclinical validation in animal models. Or, it could be a company that’s gotten past their proof of concept, and are looking to do a stage I clinical trial.
 
I also don’t want to leave the impression that this is for innovative therapies only. We are interested in diagnostics, devices – whatever can improve the lives of people with MS. On the other side, there are companies out there that are not necessarily looking for a novel, new blockbuster, but are interested in repurposing an old therapy for MS. A lot of things have not been tried, and have gotten off patent, and we want to provide some financial incentive that would say, ‘If you are a company that has an old drug, and have evidence that it would be potentially applicable to MS, we’ll provide resources for that.’ We’re particularly keen to providing capital for that angle, because, quite frankly, many of the established players are not going to go after an old drug that could only yield $10 million or $20 million in profits in a given year. But for us, it’s not about the money. It’s about getting therapies for MS out there.
 
You have already secured $4.5 million out of the $30 million you intend to raise over the next six years. Where is the money coming from? Is NMSS funding any of this out of its own pocket?
 
Yes. Our national board committed $3 million to this immediately. The other $1.5 million has come from individual donors. I guess you could call the $4.5 million our seed capital. Our objective is to raise philanthropic dollars to support this. We’ll go out and raise charitable contributions.
 
Also, we are very open to the notion that we would be part of a consortium. Let’s say an opportunity came to us where the total need is $2 million, and we can put in maybe $500,000. We can’t fulfill 100 percent of the need, but we are more than happy to partner with others, like venture groups, that might put in the rest. And from a funding model point of view, we don’t aim to be VCs. We are not going to want to run companies. That’s not what we do. Our strength is raising philanthropic dollars and evaluating science.
 
What will the value of the individual awards be? Even the total of $30 million only scratches the surface of the cost of drug development.
 
We’re aiming, at least at the outset, to give anywhere from as little as $100,000 to as much as $1 million, depending on the type of arrangement. A clinical trial might take $1 million, but an animal proof-of-concept clinical validation study might take only $250,000. We are always expecting that companies will have some sort of internal funds to supplement our funding, or have secured some additional money, or are willing to work with us to do that. We don’t aim to be 100 percent of anything. We can’t be a sole funding source. The chunks are very modest, so I think the target market will be some of those early-stage companies. That being said, we’ve already been approached by some rather big-name players looking at not only the financial resources, but the value that we add being affiliated with the NMSS. We can help bring expertise. We have access to people with MS. We have access to doctors who can do clinical trials. For companies, particularly those that are new to the MS space, we can help make connections.
 
The money for this program will be on top of NMSS’s typical academic funding?
 
Yes, we’re going to continue funding the academic programs. The academic research gives rise to the ideas and concepts. We need to be able to continue that. Fast Forward will be on top of that.
 
Like a university tech-transfer office, do you also expect that you might be able to generate royalty and milestone payments down the road to funnel back into the program?
 
Certainly. These are going to be classic kinds of business agreements that you might see between pharmaceutical companies. There are a couple of flavors. One would be a contract where we would provide specific milestones for a company to accomplish [in return for] an up-front payment and payments on certain milestones. For all of those types of agreements, there will be some sort of payback agreement. If something were to be successful from this, we would agree up front on some sort of royalty payment. We’re not doing this as a way to generate revenues. It’s more of a way to say that if a company is going to use our resources, we expect them to aim to make commercially viable products. It’s just to demonstrate that we’re serious about that. We’re also open to companies preferring us to take equity or stock in the company in exchange for funding.
 
Does NMSS retain ownership of any IP that is generated from these projects, either at universities or at companies?
 
Typically if it’s funded by the government, the university owns it through Bayh-Dole. Our university arrangement is that if something comes out of the project that generates revenues, we and the university enter a discussion about the appropriate revenues that would come back to NMSS.
 
In this case, any IP that is generated will be retained by the company. We don’t aim to manage IP or anything like that, because it’s not what we do. If the company, for example, needs to license something from a university, then they need to negotiate that with the university, and whatever piece comes back to us is on top of that. I will hasten to add that we don’t intend to allow our agreements, in terms of royalties coming back to us, to be a royalty stack. If a royalty stack was blocking something from being developed, we’d [waive] our [royalties]. We want to see the drugs get on the market.
 
From a practical standpoint, we’re not an IP law firm. You can spend considerable time and effort managing IP, and this program is not part of that. We assume that as part of the vetting of proposals that come to us – just as a venture group or partnering company would do – that the company has the IP, they either own it or license it, and have freedom to operate and develop and all that. We’re not going to provide money to someone that does not have the appropriate IP in place.
 
Are you looking to specifically pair academic projects with interested companies?
 
If the opportunity presented itself where if we could be the facilitator of something we were funding on the university side for future commercialization, we would do that. But again, we will usually leave that between the company and the university. Adding a third party to that mix is a recipe for confusion. Our approach will be, ‘When you have the licenses and everything set up, we will provide the money, assuming it passes muster.’ It will be a strictly financial relationship where if something comes out of it, this is our expectation, and they just have to factor that in downstream.
 
Other non-profit groups, such as the Cystic Fibrosis Foundation and the Leukemia and Lymphoma Society, have done this sort of thing. Are you aware of the scope or size of these programs, or whether they’ve been successful?
 
Sure. The Cystic Fibrosis Foundation is arguably the most successful of the group. Last I heard, they have spent close to $600 million using this type of strategy since 2000. They’ve done large-scale deals with companies like Vertex Pharmaceuticals, which now has a drug in clinical trials for CF, and is working on a battery of others.
 

Another notable success is the Juvenile Diabetes Research Foundation. They have a similar program to the Leukemia and Lymphoma Society, but have been doing it for longer. Last month, two of the companies JDRF had invested in entered into strategic alliances – one with GlaxoSmithKline, and the other with Eli Lilly. Both of those were successes where early-stage commitment from JDRF helped support the next stage of clinical trials.

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