At A Glance
Background: Chairman, President and CEO of Cell Pathways, 1997-2003
President and COO of Integra Life Sciences
General Manager of Focus Technologies
Vice President of Development and Operations, Collagen
Positions at Pfizer, Merck
B.S., M.S., Biology, Villanova University
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Earlier this month, RNAi startup Nucleonics said that it had tapped Robert Towarnicki as its president and CEO, ending a year-long search for a front man.
Founded in late 2001 with seed money from GlaxoSmithKline’s venture fund SR One Limited, Nucleonics was originally headed by co-founder Tony Giordano. When he left the company in mid-2002, SR One, along with Nucleonics co-founders C. Satishchandran and Catherine Pachuk, began searching for a replacement and Towarnicki was eventually approached.
Towarnicki was most recently the chairman, president, and CEO of Cell Pathways, which this summer was acquired by OSI Pharmaceuticals for $31 million in stock, as well as a five-year contingent value paid out in stock that could push the purchase price to as much as $80 million, based on OSI’s current share price.
Now at the helm of Nucleonics, he is in a position to set the course for the 12-person company as it gathers together the capital and IP it needs to reach its goal of developing and ultimately marketing drugs based on the RNAi technology it has termed expressed interfering RNA, or eiRNA.
Why did you decide to join Nucleonics?
There were several reasons, one being that the RNAi space, the RNA interference area, is a very exciting area. Many people have been talking about it as one of the most exciting scientific breakthroughs in recent years. Science magazine called RNAi the breakthrough of the year for 2002. When I met with the founders of the company, Dr. Satishchandran and Dr. Pachuk, I was very impressed with their commitment to moving into the clinic quickly with their program. This company is focused on product development.
When you were approached about taking the job at Nucleonics, was that when you first became aware of RNAi?
I had been reading a little bit about it; I tend to follow the biotech press. But I certainly turned my attention to educating myself a lot more on the science and the promise of it when I was approached about the possibility of joining Nucleonics.
Nucleonics uses a technology called eiRNA. Can you explain how it differs from siRNA?
It differs only in the sense of how we get an siRNA into a cell and functional. Some of the companies working in the RNAi space are intending to deliver short interfering RNAs directly to the target tissue. We think the much more efficacious and safe approach is to actually enable the cells themselves to utilize the systems that they’ve developed through evolution and, in a sense, turn them on to creating their own short interfering RNAs.
We’re doing that by delivering DNA plasmids to the cell. The genomic construct within the plasmid has been designed to have the cell express long double-stranded RNAs that have multiple genomic sequences targeted at whatever disease we’re targeting. Our initial approach is to go after some of the viral diseases, because the RNAi approach is so perfectly targeted to that. The first two product candidates we’re pursuing are HBV and HCV. Other potential targets for us would include HIV, SARS, human papillomavirus, [and] herpes simplex virus.
Now that you are getting settled in at Nucleonics, what do you see as your first tasks, from a business standpoint?
Clearly, my first task is to close our Series B financing. We had Series A financing with SR One as the lead investor, in that situation. We’re just getting ready to distribute our business plan now and we’re out looking to raise a Series B financing of approximately $20 million that will fund us through the filing of INDs for HCV and HBV.
How close is Nucleonics to meeting that $20 million goal?
It’s hard to say. I’ve only been here three weeks. I’m optimistic that we’ll see something close before year end.
Who are some of the investors that you’ve either gotten on board or are talking to?
I’d prefer not to talk about who we’re actually talking to now about the Series B financing. Suffice to say, we’ve approached many of the major players in the biotech arena in terms of the venture community, and obviously targeting those that are willing to finance an earlier stage endeavor. We think that we can be in the clinic within 18 to 24 months, but a lot of the venture community today has moved over and filled the void that was lost with some of the smaller banks and some of the bridge financing organizations, and we see a lot of the venture money going into public companies. So we’re obviously targeting those funds that are still investing in and helping to create the new companies and the start-up situations that are further out. But the promise that Nucleonics brings, and one of the selling point[s] of Nucleonics is the fact that we think we can be in the clinic very quickly.
Do you think that the $20 million will be sufficient to carry you that far?
Yeah. We have a very detailed project plan and financing budget that shows what we can do on that money. We believe we can get two INDs filed. We will then need to bring in another round of financing, or there’s some discussion of bringing in a larger financing that would take us all the way through phase II.
What are your long-term hopes for the company?
Right now, we’ve targeted on a three to four year plan to get us through phase II data sets into lead indications. I would hope that in that timeframe we would establish strategic alliances with either large pharma or biotech who would be in a position to then take products into phase III. So we will look for partners, after generating some safety and efficacy data and creating a little more value and a little more science around this technology, to finance phase III studies and ultimately introduce the products around the world. So we see ourselves as a preclinical development organization that will identify targets and develop the products through phase II.
Could a merger or acquisition be out there for you?
That’s always a possibility. We have to look at all business opportunities as they approach. I believe that consolidation will continue in the industry. There are a lot of RNAi companies out there right now and I think that there will be room for consolidation there both from an economic standpoint and from a necessity standpoint with the intellectual property situation as it stands today in the RNAi space. It’s a difficult intellectual property area to work in right now. Something we focused on early in the startup of this company, both through our own patent filings and through licenses, we believe we’ve established a freedom to operate and a very strong position within the expressed interfering RNA area.