20 May 2005

Howard Fillit is the executive director of the Institute for the Study of Aging (ISOA), a biomedical venture philanthropy funding drug discovery for Alzheimer disease. Since 1998, the ISOA has committed more than $23 million in support of 133 research projects and conferences at leading academic institutions and biotechnology companies in ten countries.

Together, the Alzheimer Research Forum and the ISOA have put together a drug discovery tutorial to help basic researchers understand the process of taking their research all the way from target discovery to new drug application. We also maintain a company database that can help at various stages of the drug discovery process, from initial screening to clinical trials.

Q&A

ARF: How did the Institute for the Study of Aging get started?

HF: We were started by the Estée Lauder trust in 1998 with the mission to bridge the gap in funding for accelerating drug discovery for Alzheimer disease. We have since funded about 133 programs in about ten countries with about $23 million. We've funded about 90 academic programs and about 15 biotech companies, including two companies that we cofounded, and then the remaining programs are conferences and related events that would be devoted to accelerating drug discovery through "think tanks" and that sort of thing.

ARF: What was the premise of bridging this gap? What was seen as the major lack?

HF: I think, especially in 1998—it's changing a little bit now—but even today, there's a lack of funding from any source for early-stage drug discovery. You have a lot of academic scientists today who are capable of, or interested in, doing drug discovery, but they have a hard time finding funding for it from places like the NIH or other foundations which typically fund more mechanistic research. The same is true in the biotech world, where you have investors looking for investment opportunities that are less risky and more clinically oriented—in other words, investment opportunities that are closer to regulatory approval and clinical trials. So there's clearly a funding gap between new knowledge that's being created around Alzheimer disease pathogenesis and the early stages of drug discovery. It's very difficult to find money for that, so we decided, as a relatively small foundation, to basically put all of our money into bridging that gap. We've had a lot of good uses of our money in academia and biotech companies. Literally millions of compounds have been screened on novel targets and multiple, probably hundreds, of new lead compounds have been identified, and even new classes of agents for Alzheimer disease have been created. Tens of patents for new drugs have resulted from the work, and several of our programs have gone from the lead discovery stage toward clinical trials.

ARF: Are you funding clinical trials, too?

HF: We have funded some clinical trials. For example, today in the New York Times there's an article in the Business section about the first clinical trial for gene therapy for Alzheimer disease.

ARF: Right. The NGF trial?

HF: Yes, they don't mention us, but we actually funded most of that program.

ARF: Yes, I just saw that the paper came out in Nature.

HF: We're very proactive on this biomedical-venture-philanthropy model, which is kind of the way we've tried to frame what we do, which is to be proactive in finding investigators and working with investigators to advance the field. In the case of Mark Tuszynski, he came to us at a time when he really couldn't get any money for gene therapy, and we gave him money for that clinical trial about 5 years ago, and that's paid off. Similarly, Larry Sparks came to us about 5 years ago because he wanted to do a clinical trial of Lipitor for Alzheimer disease and he couldn't find any funding for it. We gave him the money for that and that's turned out pretty well. There's another company out there that at the time had little money in the bank and was using a glucocorticoid-2 receptor antagonist called RU486, which is the birth control pill, for psychotic depression, and we helped them to get an Alzheimer program going which is in an ongoing clinical trial right now, and that company (Corcept) eventually went public. We've helped Jordan Tang out in Oklahoma start a company called Zapaq, which I think is one of the leaders in developing β-secretase inhibitors. Jordan was the first to crystallize the β-secretase molecule, and the company is heading toward clinical trials. Jordan is an expert in enzymes called aspartyl protease inhibitors. He worked a lot on creating the first HIV protease inhibitors, so he's really an expert in that area. So we've done a lot to try to advance the field. We also recently worked with the National Institute on Aging to get a drug discovery RFA together for Alzheimer disease.

ARF: Tell me a little bit about that. Is that out right now?

HF: Yes. The main thing is that we've just focused all of our money on funding drug discovery for Alzheimer disease, and I think what we've shown is that a small amount of money can really lead to a lot of really good translational research, for a relatively modest sum. I guess $23 million isn't that small an amount.

ARF: So you're still actively looking for funds, looking for donors?

HF: Well, yes. That's a good point. Last year we created a public charity. We were a private family foundation that was supported solely by the Estée Lauder trust, but last year, the board asked us to create a public charity so that we could get other donors involved in what we do. So now we're in a fundraising mode. That's another activity that we have going now which is a fundraising campaign to try to raise money for this effort.

ARF: How does this system work? Do researchers apply to you for a grant?

HF: We're trying to be as friendly as possible to scientists because we know how hard it is to go through the long cycles and the sort of monolithic process that can exist out there, so we don't have any deadlines. We're always looking to talk to investigators about new ideas, to provide strategic advice on how to create drug discovery programs, to connect people with chemical libraries, or help them to network with people who have the right targets or animal models, and work with them on a grant, and if they submit something, we look to get the review done as quickly as possible, within 90 days, and then work with the investigator to target a grant that meets the needs of the field and is budgeted properly. So we're very iterative in our granting process and we have no deadlines.

ARF: Do you have a peer review board?

HF: Yes. Actually all of this material and information is on our (website). On the website, there's an electronic application process, and anybody can go there anytime and apply to us, or call us up or send us an e-mail. We can work with investigators to give them an idea, because I think the problem in academia, particularly, is that most academic settings don't really have the infrastructure or the teams in place to do drug discovery, so you often have biologists working on pathogenesis, but they may not even know a medicinal chemist, for example, or where to get libraries to screen a target. That's the kind of help we like to provide to investigators.

ARF: This brings us on to the Alzforum collaboration, which aims to help scientists identify tools and strategies that they can use to launch drug discovery programs, correct?

HF: Absolutely, and the same thing holds true in these early-stage biotechs that we fund. A lot of innovation comes from early-stage biotechs, but these biotechs also often have a lack of expertise in Alzheimer disease biology, or they might not necessarily know where to get connected to the animal models or the proper drug discovery services that are related to CNS and Alzheimer disease. For a number of years, we had been thinking about ways that we could more broadly accelerate drug discovery for Alzheimer disease through sort of a networking process, and I think when we got to talking with June Kinoshita, we realized that the Alzforum would be a perfect place for this, so we came up with a model of a website being a resource for investigators worldwide.

What we particularly hope to do is for the academic investigator, who generally would have the need for things like access or knowledge of where the chemical libraries can be found, what kind of companies are out there that provide rational medicinal chemistry-type services, what kind of companies are out there that provide high-throughput screening devices or assays, or can do preclinical proof-of-concept experiments employing animal models, and so the idea here was to provide the networking that we have provided on an ad hoc basis through the foundation, sort of provide that through a database, with all the advantages and disadvantages that that might have, as a starting point. Along with that, we thought that this idea of a tutorial, obviously very basic, but we found that many academic investigators who really did have an interest in finding the cure, if you will—the cure which ultimately is a chemical—really didn't have any training in medicinal chemistry or in the drug discovery process. Many people who are, for example, neurobiologists, don't really understand the process and don't know the various stages and what it involves. So the tutorial provides a really good start on beginning to understand the process of drug discovery and what it takes to do this worthwhile endeavor.

ARF: So, you have people on hand to help interested researchers or are you more of a liaison, putting them in touch with chemists or people who provide services such as high-throughput screening? None of the work actually goes on at your institute?

HF: No, we don't have wet labs. I guess a good way to put it is that we provide consulting services and knowledge management. We try to provide strategic management to the field. We can't possibly fund all the proposals. In the last 5 years, we've had over 500 drug discovery proposals, 500 different ideas for new drugs, and since we can't fund everyone, we try to help everyone. We don't want to be in a position of just sending out rejection letters to a lot of people, so we have tried to work with people to advance the field above and beyond our funding program, whether or not people get funding from us.

ARF: You mentioned the NGF study. Anything else that's come out of the last 5 years or so that looks promising?

HF: Yes, I think the Zapaq story is very promising, where they have orally available, small molecule β-secretase inhibitors. Jordan is an amazing scientist and truly an expert in the field of aspartyl proteases. And we also helped to create Allon Therapeutics. While much of the early research was funded by the NIH, getting the compounds into a biotech has accelerated the preclinical and clinical development greatly. Ilana Gozes is the chief scientific officer, and they have this neuroprotective peptide that's delivered intranasally, and that's going into clinical trials for Alzheimer disease. As we speak, the trials are being designed into phase II.

ARF: But since then they've been able to get some extra capital?

HF: Yes. In fact, I can give you some factoids; that's the thing that would probably be most helpful to you. So, in the last 5 years, there have been 128 biotech IPOs. Of those, there have been only nine that have reported any kind of CNS drug discovery program, or drug development program. Of those, there have only been five that have reported any kind of Alzheimer disease drug program, and when I say "any kind," I'm including virtual programs. We know that investors like to invest in biotechs that have programs in clinical trials, right? Only one of those biotech IPOs within the last 5 years went public with a clinical trial in place, and ISOA paid for that clinical trial.

ARF: And that was?

HF: Corcept.

ARF: Those statistics are amazing.

HF: Yes. We estimate that of the 1,600 or so public and private biotechs in the US, there are approximately…well, we used to say 60, but I'm going to say about 80 biotechs that report any kind of program in Alzheimer disease, which is also a fairly small number. And our little family foundation has funded 15 of them and actually created two of them, and with the modest sum of about $4.5 million. But these were all very early-stage companies, and it's been a hard environment to raise money for early-stage biotech companies, particularly those with Alzheimer programs as a focus. But our companies have gone on to raise over $260 million in follow-on financing, which kind of points to an ability to do pretty good scientific due-diligence and help companies to move forward.

ARF: That's fabulous! So what do you think is the reason for this apparent dearth of companies interested in Alzheimer's? Do they think it's too risky? Too tough?

HF: I think it's viewed by investors as very risky. I think there are a lot of myths out there that need to be dispelled about barriers to Alzheimer disease drug discovery and drug development. I think that we're coming out of an era of enormous investment in Alzheimer disease research, but that investment of billions of dollars hasn't been translated into the drugs, and I think it's because investors are still wary of the idea that we really don't understand this disease, but I believe, at this time, we know as much about the pathogenesis of Alzheimer disease as we do about heart disease or cancer. And then, there are myths about the lack of animal models, but I think we have many animal models today. And then, there are myths about the lack of validated targets, but I think we have many targets that are rational and are being used as the focus for drug discovery, including many novel targets. There is also the issue of the idea that, once you had a preclinical proof-of-concept, that it would be very difficult to do clinical trials that would lead to human proof-of-concept, and I think that is also a myth. I think there have been many clinical trials at this point, and that the clinical development pathway for Alzheimer disease is very well-established, now, both for symptomatic treatments, but also we know how we're going to develop disease modifying agents when they come into clinical development.

So, what we need to do now is begin to dispel these myths that investors have about Alzheimer disease drug discovery and drug development, and get more academic investigators involved in drug discovery, because I think in academia, there is increasing interest in drug discovery, in technology transfer, in translational research. The technology has also changed, so that now academic scientists can buy high-throughput screening robotic machines that are desktop-type devices. They can now buy chemical libraries commercially. They can buy computational software. Their institutions have changed their mission and are interested in the focus on translational research and potential royalties from licenses that the translational research can bring, as well as the technology transfer of not only intellectual property, but also biotech company creation. So by educating investors about the real state-of-the-art of Alzheimer disease drug discovery and development, and encouraging academic Alzheimer researchers—and this can be done partly by providing them the network and the access through the Alzforum site as an entrée to ways of networking into the drug discovery community—we can accelerate the path to new drugs for this disease.

ARF: So when you have a success story—you've funded several of these startups, now—do you require them to pay you back anything if they hit it big?

HF: Well, this is kind of our model, but it's a minor part of our model. You know, whenever a university finds a deal with a drug company or licenses any kind of intellectual property, they also seek some return on that investment so they can use that money to advance the charitable mission. Let's not forget that universities are nonprofit institutions. They are sometimes very aggressive in seeking return on investment. That's because the theory is that the university has invested heavily in the infrastructure and in the risk of drug discovery and in intellectual property development. I think it's only fair, it's the right thing to do, and it's what we should be doing to recycle the money that ultimately is going to be made by a for-profit pharmaceutical company, which will be the entity that provides the late stages of a very expensive process of phase III-type, or phase II and III clinical development, and then sales and marketing, and monitoring phase 4—post-approval monitoring. I think that it's the right thing to do for foundations, and public charities and universities, as nonprofits that take the risk in the early high-risk stages of development, to seek return on their investment. That's part of a trend today in the nonprofit world. The nonprofit world plays a crucial role in our society. It's a $1 trillion business in our society, and it plays a crucial role in economic development. As such, it really should be able to get some of the benefit when a program that is successfully created begins to generate a revenue stream. I think some of that should come back to the entity that originally took a high risk to advance its mission.

The other side of the coin is that, unlike, say, venture capital investments—and some of our biotech investments are in some ways similar to venture capital investments—but—and it's a big "but"—the primary purpose of our grants to biotech is to advance the charitable mission to find new drugs, and not to make a profit. Also, our terms are much more favorable to these entities, to the biotech entities, for example, than they would get from a for-profit investor. So our funding is very favorable and attractive to early-stage biotechs because it provides them with high-risk funding for scientific programs to help them get preclinical proof-of-concept and attract other money on financial terms that are very favorable, but we're much less aggressive than a venture capital firm. At the same time, we try also to provide strategic management assistance. To these early-stage companies, that's very important. I sit on some of the boards of companies that we've funded, and in many cases I might be the only Alzheimer disease expert on that board, and that's very valuable to the company in terms of networking with researchers in the field, or understanding the targets and the market, so we provide that kind of assistance, as well.

ARF: Are you doing any research yourself?

HF: Not any bench research, though we do still get involved in outcomes research including pharmacoeconomics, which is becoming increasingly important in the later stages of drug development and regulatory approval. I ran a lab for 25 years. I ran a lab at the Rockefeller University for 12 years, and I ran a lab at Mount Sinai for about 8 years. I guess that's 20 years, not 25 years, but I spent 5 years as a postdoc, so I spent my time there, but I find this to be a very gratifying job because I can help other people, and I'm able to do it worldwide, and I'm very proud of what we've done at the institute in advancing the field, accelerating drug discovery for Alzheimer disease.

Tom Fagan Interviews Howard Fillit

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