OICR, with its network of outstanding researchers and facilities located at the MaRS Centre and at Ontario's leading universities and hospital-based research institutes, is well positioned to advance the next generation of drugs, therapeutic products and health services for the benefit of cancer patients in Ontario and worldwide.
The Institute actively seeks industry partners and private investors to participate in development and commercialization of cancer research. Its industry-focused commercialization program is staffed by a very experienced team with a mandate to foster an effective and collaborative approach. The team works with both OICR-sponsored research and external Ontario-based scientists and inventors. It is nimble and moves quickly once it identifies intellectual property (IP) suitable for development. It facilitates the management of IP, engages industry in collaborative arrangements and promotes value creation for Ontario.
Four years ago OICR created a targeted investment and commercial development program called the Intellectual Property Development and Commercialization (IPDC) Fund to address the critical need for funding and expertise to enable proof-of-concept activities. The IPDC Fund de-risks and accelerates the advancement of promising cancer innovations by providing meaningful, timely funding and expert commercial and regulatory guidance. To date, the IPDC Fund has supported 15 projects across a wide spectrum of technologies including medical devices, imaging, therapeutics, diagnostics and software. OICR also makes equity investments in selected start-up companies that have successfully matured their technology through the IPDC Fund, including the formation of new start-up companies owned jointly by OICR and its research partners.
In addition, OICR has initiated a novel private-public partnership, cancer-focused accelerator called Triphase. It is an Ontario holding company co-founded by OICR and MaRS Innovation that will in-license cancer-related assets at the Clinical Trial Application – Phase I stage and carry them through to Phase II clinical proof-of-concept. Triphase will provide proof-of-concept funding, start-up company space, industry advisory and other resources to help companies move from late pre-clinical to clinical proof-of-concept in less than three years at a cost of less than $10 million per product. When clinical proof-of-concept is achieved the technology will be sold, licensed or spun out.
The tax regimes of both the federal and Ontario governments are very generous for investment in R∓D and among the best worldwide. They offer substantial tax credits for foreign investors and provisions for easier foreign venture capital investment. The federal government's requirement for tax withholding by non-resident investors in high-tech businesses has been repealed, creating a favourable environment for the investment community.
When Dr. Scott Tanner and colleagues founded DVS Sciences in 2004, they knew they were facing an immense and very risky challenge. Private capital for life sciences is difficult to secure even for established technologies and the instrument Tanner was developing, while extremely promising, was new and still unproven. He had experience working in industry but navigating the regulatory and financing side of the business requires a great deal of money and expertise.
DVS Sciences was one of OICR's earliest commercialization ventures. It first benefited through funds that OICR's predecessor organization, the Ontario Cancer Research Network (OCRN), provided to Tanner's group at the University of Toronto, which leveraged substantial development funds from other sources. At a later critical stage, OICR's Cancer Stem Cells Program purchased the first commercial prototype of the instrument from DVS. This sale enabled the company to gain complementary funding to bring the technology to market entry. OICR then provided direct funding and business development mentoring through the IPDC Fund.
"OICR's IPDC Fund investment effectively bridged the 'valley of death' – that period of transition between invention and the market," said Tanner, who is now President and CEO of DVS. "And without that initial support from OCRN, the development of the technology is unlikely to have happened."
This year the company opened its global R&D and manufacturing centre in Markham, Ontario with 14,000 square feet of space designed to enable the production of 100 instruments per year. It has additional room to support research and engineering development. The company currently has 23 employees and plans to expand to 35 by the end of 2011. Six of the instruments, which cost more than a half million dollars each, have been sold to buyers in Canada, Japan, Taiwan and the U.S., and the company is opening an additional 11,000 square foot facility in Sunnyvale, California that will house global sales and marketing.
Dr. Scott Tanner
President and CEO
ORCell Therapeutics was formed last year around a technology developed at the University Health Network's (UHN) Princess Margaret Hospital by Dr. Li Zhang. The technology could provide a new form of treatment for acute myeloid leukemia, a disease that currently has very few treatment options. OICR first became involved in the company through a $500,000, two-year investment from the IPDC Fund that was used to assist in advancing the technology and proof-of-concept.
"At the end of that initial funding period, we felt that the technology had sufficient promise that we should try to further develop it toward commercialization," says Frank Gleeson, an Executive-in-Residence in OICR's Commercialization Program. "This represents an area where OICR is really trailblazing because we're dealing with a technology that is profoundly important but, because of the type of research, raising private capital is particularly challenging."
OICR partnered with UHN and Zhang to form TORCell. OICR then provided seed funding to the company to enable it to assess the likelihood of whether the treatment, which involves using a sub-population of the patient's own cancer-killing T cells to treat the disease, could be approved for clinical development. OICR's Commercialization team spent several months providing regulatory and drug development expertise for a successful presentation of the technology to Health Canada. When the clinical development plan was found to be viable, OICR made a follow-on investment to prepare the preclinical package in anticipation of a first-in-man Phase I clinical trial in 2012.
"We're recognizing that point on the translational spectrum where there's a need that cannot be filled by the existing infrastructure and capital markets," Gleeson says. "OICR is unique in having the understanding of what is required, bringing the expertise to the table in a collaborative spirit and having some of the capital necessary to build a bridge to the private sector investment markets."
He points out that a willingness to work together with other funders is also crucial. In the case of Xagenic Inc., another company formed last year with assistance from OICR, an even larger funding partnership was established. Based on technology developed by Drs. Shana Kelley and Ted Sargent at the University of Toronto, it was a broader partnership between OICR, MaRS Innovation, the Health Technology Exchange and the Ontario Centre of Excellence Centre for Commercialization of Research. Combined, these partners were able to offer $1.04 million in capital for the new startup. The money will be used to develop a new, chip-based molecular diagnostic technology that has the potential to detect many conditions, from bacterial infections to genetic disease and cancer.
"It is important to point out that to support these companies to the next stage does not always require a huge amount of money," Gleeson says. "It's the right amount at the right time, used efficiently on the right tasks. Timing and clear priorities are the keys. This can make a tremendous difference in the future of these companies. Working with them in the areas outside of their expertise, namely the financing and business-building aspects of translating research to the marketplace, has paid huge dividends and has been an area where we're collectively making a significant contribution."
Gleeson sees TORCell as a model of company formation that OICR can use to help develop other successful collaborative investments. OICR took a similar approach in the founding of DLVR Therapeutics, also in partnership with UHN, and in financing Harmonic Medical, a spin-off from Sunnybrook Health Sciences Centre. They are both new Ontario-based startups developed over the past year. OICR is flexible, offering different investment options to ensure that any investment it makes is tailored to best suit the technology involved.
"In every one of these examples the principles are the same but the details are quite different," says Gleeson. "Essentially, our challenge is to single out those special technologies that might have profound impact from all the other technologies that are simply interesting. Many technologies are compelling, but some are more commercially relevant and have more potential. These are the ones that we try to identify and advance."
Tanner, meanwhile, is optimistic that his partnership with OICR can be used as a model for OICR to develop and commercialize other promising technologies around the province.
"A successful partnership involves not just the funding but also the business mentoring that builds confidence. It is by no means an easy path, and requires incredible commitment from both parties. But with the right team in place and the right drive, I believe that it can be replicated – and hope that it will be, over and over."
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Dr. Li Zhang
Founder and Principal
Mr. Frank Gleeson