Pharma team seeks Israeli technologies

Novartis

Novartis Global Strategic Partnership head Marie Lindner spoke to "Globes" ahead of her visit to Tel Aviv later this month.

"I manage the Strategic Partnership Team, and if that's not clear enough, it also took us a little time to define ourselves," Novartis AG (NYSE:NVS; LSE: NOV; SWX: NOVZ) Global Program Head Strategic Partnership Team Marie Lindner told "Globes" candidly. "As a joke, I used to call it the 'Non-strategic Partnership Team,' because at the beginning, our purpose was only to look for opportunities in any areas that were not part of Novartis's core pharma franchises, so that we could get into areas that we may have missed otherwise," she told "Globes."

Things look a little differently nowadays, and the Strategic Partnership's Team has redefined itself by adding some specific opportunity areas, rather than just “white space,” Lindner says. "Our team still looks for those opportunities, but the team is also looking for opportunities in liver disease, inflammatory bowel disease, hearing loss, neonatal therapy and the microbiome.

"We continue to be responsible for finding opportunities in areas that the company has marked as interesting, but in which it currently does not have much activity. Otherwise, for liver diseases, with an emphasis on NASH and cirrhosis, we discovered that we had an internal program that would be very competitive, as well as looking for outside opportunities, which is how we ended up as the business team for liver disease. "Beyond that, we're responsible for the connection with Israeli company BiolineRX Ltd. (Nasdaq: BLRX); TASE:BLRX), which is looking for opportunities in Israel for us, and with French venture capital fund Seventure in the area of products linked to the human microbiome (Health for Life Capital fund) - the medical effect of bacteria in and on the human body.

"We're a little like a venture capital fund, as we're not actively managing any R&D projects; we have to cooperate with the development franchises inside Novartis."

Lindner and her team will take part in the 2016 Israel Advanced Technology Industries (IATI)-BIOMED Conference on May 24-26 in Tel Aviv in order to look for opportunities for cooperation with Israeli companies. The conference, the flagship of the Israeli life sciences industry, will be held this year on a new format of nine tracks, each one involving a certain sector of the life sciences industry, and there will be an exhibition for companies and a special compound for startups. Novartis is the world's largest pharmaceutical company (according to 2015 revenue). Its current market cap is $202.7 billion, and its CEO is Joseph Jimenez.

Cooperation with BioLineRX

"Globes": You cooperate with BioLineRX, a drug development company listed on the Tel Aviv Stock Exchange (TASE) and Nasdaq.

Lindner: "As part of our cooperation, we invested $10 million, and sent them to look for interesting projects in Israel for cooperation in development." For each joint project that reaches clinical stage, Novartis pays half of the development cost, plus an option fee with predefined terms for the initial projects, and later ones to have terms to be defined.

"BioLineRX is obligated to show us each project they see in Israel, and they can also show us projects they bring from out of Israel, but this they are not obligated to do. We decide which of these projects to participate in. They do all the work in the early stages, with feedback and advice only from us. We jointly define the milestone according to which we say whether or not it's worthwhile continuing, and the milestone at which we consider whether to take the project for ourselves for further development by Novartis would occur at phase 2. BioLineRX is an entrepreneurship company. They have scientific depth and this partnership is beginning to bear fruit. We have already selected several projects to work on."

How did the relationship between the companies develop?

"It's a very interesting relationship. We come from slightly different worlds, with the difference being not between Israel and Switzerland, but between a large pharma company and a smaller biotech company. At Novartis, we sometimes want to enter a more long-term project, such as a drug for Alzheimer's disease, and they prefer a project from which they can see an exit in a reasonable time span. It took them time to understand how to present a project to us, and we had to find a way to quickly get projects to approval by the company. For our part, we had to expedite the pace at which we let them go ahead, because we're rather bureaucratic and slow. Our goal in working with them is to move forward at their pace, not ours."

"Last year, I attended the BIOMED Conference independently - it was a Swiss religious holiday, and I said that since I'm Jewish in any case, I'll come to Israel for the holiday. I met several interesting groups of scientists here through BioLineRX, and only then did I realize that it was worthwhile for me to come here for BioLineRX's meetings with scientists in the projects it's considering. Up until then, BioLineRX representatives used to meet the companies on their own, and then come to us to tell us about them. Now we go to Israel at least-four times a year - a team of four people is responsible for this cooperation on Novartis's side. Our presence at the meetings helps us pick the joint projects faster."

How many projects do you think you will get from this partnership?

"We'll be glad if all the projects we invest in through BioLineRX eventually come to us, but the realistic target we set for ourselves is to work jointly on seven projects, and bring three in house."

What else are you looking for at the BIOMED Conference?

"We'd like to get closer to the Israel venture capital funds, and we'd love to meet with them. For us BioLineRX is like an incubator, while the relationship with a fund is something else. Novartis itself has a venture capital fund that's in touch with the Israeli funds, and Novartis research is also in touch with Israeli VCs. Novartis itself is not setting up incubators at present, but our competitors are doing it, and maybe in a year or two, it will happen to us, too.

"In the hot sectors, the subjects we find most attractive are liver disease from a very broad range of severity and also predictive biomarkers; new approaches to inflammatory bowel disease, in products beyond the current biological drugs, and especially biological markers that will help us diagnose the disease and distinguish between sub-categories of the disease and help predict responses. We're also looking for drugs for loss of hearing, of which there are none yet. Other groups in Novartis are responsible for diseases in other areas, such as neurologic diseases, cardio-metabolic diseases, immunology/dermatology, ophthalmology and respiratory. ."

Are you also looking for activity in digital and computerized health?

"Not through my department, and not through BioLineRX, but the global Novartis company is interested in it, and we may be able to find the relevant part of the company to talk to. The head of development at Novartis talks a lot about the need to use digital tools to improve the development process."

"The market is always volatile"

What's your opinion about the state of the biomed sector on Nasdaq?

"The market is always volatile. The recent declines are partly the result of a discussion about drug prices that arose when a number of companies priced several old drugs too high, putting all the drug companies under the gun. There's concern about whether drug prices will fall, and whether we're moving towards in world in which the insurers restrict the use of a drug even after it's approved. The question then arises of whether drugs can be priced in such a world in a way that will make back the investment on them.

"It's possible that improvement in clinical trials procedures and a more personalized approach to development could make drugs more relevant to the right patients, rather than only working in some patients, to justify pricing.

"The capital market boomed in previous years, among other things fueled by a trend in which pharma companies bought up biotech companies at high prices, because they reduced their internal R&D. When the IPO market window was open and companies floated publicly without much data at higher valuations than acquisitions and raised additional funding that way. Now the stock exchange offering window of opportunity seems to have closed, but several major pharma companies are nearing a new patent expiry point, and they'll have to go back to buying small companies at a high price, and the cycle will repeat itself."

Is the pricing problem causing you to change your focus?

"No, but there's a trend among all the drug companies to go less for drugs for the general public of doctors, for example family doctors or GPs, and to focus more on drugs with a market for a small numbers of specialist doctors - that's much more economical. It's a pity that the result is that there are no more good drugs for hypertension and no more new drugs for gynecologists - and that's unfortunate, because these are giant markets with areas of need."

Bacteria on the body

At the 2016 IATI-BIOMED Conference, Lindner will be on a panel dealing with the microbiome - the exciting world of bacteria that live on the body.

What innovations are you seeing in the human microbiome?

"Today, we already know that intestinal bacteria affect everything in medicine - each and every organ. It's also known that nutrition affects all diseases and the effectiveness of pharmaceutical treatments in a way that differs from one person to another, probably because of intestinal bacteria. On the other hand, we also know that we know nothing in this field, and it will take a long time before we understand it, not to mention bacteria on skin or found in tumors.

"What there is now is anecdotal information. For example, treatment by implanting feces from a healthy person in a patient it definitely works against a certain disease such as recurrent C. difficile, and even other diseases like diabetes, but bringing feces from donors isn't a real long-term solution. So there are companies looking now for specific bacteria that can treat the disease, in order to make them into a pill, and some that are looking for treatments that affect the bacteria directly to treat diseases. We still have a long way to go in this field.

Disclaimer: Lindner stressed that she was not authorized to speak for Novartis and the opinions expressed were her own.

Published by Globes [online], Israel business news - www.globes-online.com - on May 3, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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