Biocon's Eureka Moment - Mint Asia

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LEISURE
BIOCON’S
EUREKA
MOMENTAlzumab, which has the potential to be applied to
over 100 different types of auto­immune diseases,
may be just the breakthrough Biocon has been seeking
for the past decade. >Pages 19­21
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Cover
BY VIDYA KRISHNAN
vidya.k@livemint.com
·········································
BANGALORE
In early 2010, a 35-year-old woman suffering from
psoriasis volunteered for clinical trials of Alzumab,
an antibody then under development by Banga-
lore-based Biocon Ltd to treat the chronic skin condi-
tion.
Having spent 11 years trying various treatment regi-
mens unsuccessfully, the patient found to her surprise
that the new drug produced results within eight weeks
of starting to use it, with a 97% recovery rate, measured
against a score called the psoriasis area severity index
that’s compiled before the drug testing starts.
A further 28 weeks later, the patient, who didn’t want
to be named, had hope of relief and a better quality of
life with use of Alzumab and Biocon realized it had
struck a potential jackpot.
Psoriasis is a lifelong, auto-immune disease, which
occurs when the immune system sends out faulty sig-
nals that speed up the growth cycle of skin cells. The
disease is caused by abnormal lymphocytes (a type of
white blood cells) which result in overproduction of
new skin cells that merge together into plaques of
thickened, scaling skin. There is no known cure for the
ailment at present.
Psoriasis can occur on any part of the body and is as-
sociated with other serious health conditions, such as
diabetes, heart disease and depression, according to
the US National Foundation of Psoriasis.
The disease affects 2-3% of the world’s population
and 1-2% of Indian people, and the global market for
TURN TO PAGE 20®
Alzumab, which has the potential to be applied to over 100 different types of auto­immune diseases, may be just the
breakthrough Biocon has been seeking for the past decade
BIOCON’S
EUREKA MOMENT
DRUG DISCOVERY
Funding innovation: Kiran Mazumdar­Shaw (left) with researchers at Biocon Research Centre in Bangalore.
PHOTOGRAPHS: ANIRUDDHA CHOWDHURY/MINT

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COVER62120 mintasiaSeptember 13 ­ September.19, 2013, SINGAPORE ° WWW.MINTASIA.COM September 13 ­ September.19, 2013, SINGAPORE ° WWW.MINTASIA.COM
COVER62120
BY VIDYA KRISHNAN
vidya.k@livemint.com
··············································
BANGALORE
Kiran Mazumdar-Shaw founded Biocon Ltd in 1978
with an initial investment of `10,000 in a rented
car garage. She went on to build the company into
India’s biggest biotechnology firm with revenue of `2,538
crore in the year ended 31 March. In an interview, chair-
person and managing director Mazumdar-Shaw, 60, who
trained as a master brewer in Australia before becoming
an entrepreneur, spoke about the Indian model of inno-
vation, the development of the Alzumab treatment for
psoriasis patients and the nation’s compulsory licensing
policy. Edited excerpts:
How challenging is it to be an innovator in India?
Innovation environment in India is still very difficult. It
is so tough to get regulatory approvals. We have lever-
aged India’s cost and talent base—the India innovation
model—to do our research. If we have to do this develop-
ment in any other part of the world, it would have cost us
5-10 times (more).
We are a company that has some excitement in transla-
tional clinical research. All doctors in our country are
much more focused on clinical practice than research. So
to get doctors to do this (Alzumab) trial was very chal-
lenging. We had a handful of doctors who acted as if they
were doing us a favour during phase 2 trials. The moment
we had results, people started enrolling for phase 3.
The credibility of Indian innovation is so poor, doctors
don’t want to risk original innovation. If the same trial is
offered by a multi-national pharmaceutical company,
doctors will happily participate. Biocon struggled be-
cause it was a lone player but if an ecosystem starts
evolving where more companies are involved in original
research, it will be easier to get a buy-in from stakehold-
ers.
You think the government fosters innovation?
I am very concerned about the wrong signals we are
sending to the world. We have not done anything sub-
stantial to build India as a strong global economy. We
have wasted a lot of opportunities. We behave like the
world needs us and our policy needs to be accepted by
the global community. Over the years, we have sent all
the wrong signals for investment in the country with the
General Anti-Avoidance Rules (GAAR), retrospective tax-
ation in Vodafone case and taxation anomalies in special
economic zones (SEZs) which took a long time to be set
right. The government has created a business-unfriendly
climate. They have systematically destroyed investor cli-
mate in the country. Whatever measures are good for the
elections are bad for the economy and vice- versa.
In the past couple of years, some high­profile patent litigations
have gone against the innovator company. You think government
policies concerning the pharma sector need to be revisited?
We have lost sight of practical reality. We are only talk-
ing about how the poor man is suffering and how any-
thing to do with wealth creation is bad. We have gone
back to the old era of socialistic values where anyone
wealthy should feel guilty about it. This business of redis-
tributing wealth rather than creating new wealth is a
huge step backwards.
Healthcare is the softest target for any economic poli-
cy. Today, the government has abdicated its responsibili-
ty to provide basic healthcare to its people but it’s point-
ing a gun at the industry and saying “you provide it”. The
industry has worked very hard to create a cost-effective
and competitive sector. It is actually producing the
cheapest drugs in the world, but on top of that the gov-
ernment is saying they don’t want the industry to make
that much profit either. Which industry has this sort of
draconian regulation that tells you how much profit you
are allowed to make?
What is your take on using compulsory licensing (CL) as a way of
making drugs affordable?
India is respecting IPR (intellectual property rights). I
don’t think there is any getting away from that, but this
whole notion of compulsory licensing based on afforda-
bility has to be booted out. I think CL based on drug
shortage or public health emergency or pandemic is fine.
But you can’t be issuing CL because of the affordabili-
ty...if you really want compulsory licensing, then one
must be fair to the innovator. Are you willing to give the
innovator a hefty license fee as an annual recurring fee?
Then let’s see if Indian companies are willing to make
that payment and still willing to work in this area. Why
can’t the government subsidize it through bulk procure-
ment?. This sort of a draconian drug policy will see a lot
of Indian companies simply stop manufacturing essen-
tial drugs. And ultimately the government will import
them at a higher cost so it defeats the whole purpose.
All this is electioneering jargon and (it is) very difficult
to make sense of it.
We are being ruled by activists, PILs (public interest
litigations) and courts with regulators having no role to
play today in any issue. All sectors have to be led by sci-
ence, data and evidence. Pharmaceutical sector is the
only industry where IPR is so critical. And our domestic
companies don’t innovate so they would rather not have
patent restrictions.
Going forward, what are the challenges facing Biocon as far as de­
velopment of this molecule (Alzumab) is concerned?
The biggest challenge we have today is to build up the
credibility of Indian innovation and we are trying to do
that. If you find a partner who is credible he might be
able to get this product in the market sooner.
As we move forward, we are trying to be as thorough as
possible... We are not very fussed about the trials for oth-
er diseases. All of that will happen in due course. We
don’t need to rush into it but we need more credibility to
combat a lack of credibility Indian innovators have.
psoriasis therapies is estimated to cross $8 billion by
2016, according to Biocon.
Lymphocytes are agents of the immune system that
produce proteins called antibodies to defend the hu-
man body when it is attacked by bacteria and viruses.
Sometimes, instead of protecting the body from infec-
tion or disease, the immune system attacks and de-
stroys the body’s healthy tissues. This is called auto-
immunity.
The novel “mechanism of action” of Alzumab can be
applied to a spectrum of auto-immune diseases, basi-
cally changing the course of treatment of such ail-
ments.
On 10 August, Biocon announced the launch in In-
dia of Alzumab for treatment of psoriasis, saying it
would come with a less aggressive dosing regimen and
a longer treatment-free period, promising a better
quality of life to the patient. It claimed for the drug an
“excellent safety and efficacy profile with very low op-
portunistic infection rates and longer remission peri-
od”.
At `7,950 for a 24-week course, the drug will be 50%
cheaper than similar drugs in the market.
The biologic drug, which will soon be tested on pa-
tients with rheumatoid arthritis, can be applied to over
100 different types of auto-immune diseases including
Type 1 diabetes and multiple sclerosis. Biocon’s chair-
person and managing director Kiran Mazumdar-Shaw
calls this molecule a “pipeline in a product”.
The beginnings
Alzumab may just be the breakthrough Biocon has
been seeking for the past decade.
After decades of dabbling with enzymes and me-too
drugs—which were low investment, low risk and also
delivered very few returns for the company—Biocon
started scouting for potential molecules in university
laboratories that could be developed into novel drugs.
Mazumdar-Shaw set up Biocon in 1978 when she
was 25 years old and the biotechnology industry had
just started in India. She started the company in a rent-
ed garage in Bangalore with a seed capital of `10,000.
“The first 20 years of my career were about enzyme
innovation. Over the past decade, we have transformed
our business from enzymes to biopharmaceuticals but
the fundamental of focusing on innovation has re-
mained. Now we are focusing on drug innovation,” she
said in an interview on 23 August.
“When I started Biocon, even though we focused on
enzymes, we ensured some level of innovation went
into the process. We developed novel application for
enzymes. So, from the very beginning, Biocon had an
innovative business approach. For me, it is about the
business of science and not the other way,” she added.
In the hour-long interview, Mazumdar-Shaw spoke
at length about the decade-long process of innovation
that led to this path-breaking Alzumab research. The
word “serendipity”—which means happy accident—
was used often, both by Mazumdar-Shaw and the sci-
entists at Biocon who worked on the drug.
In early 2001, Mazumdar-Shaw travelled to Havana,
on the northeastern coast of Cuba, visiting university
® FROM PAGE 19
laboratories for possible drug candidates in early stage
of development. At the Centre of Molecular Immunol-
ogy (CIM), she got interested in a molecule which, at
that time, was code named “Th1”.
“It was an anti-CD6 antibody and I was told by Cu-
ban researchers that the molecule had some potential
in auto-immune diseases like RA (rheumatoid arthri-
tis) and psoriasis,” she said. The CD6 is a gene attached
to lymphocytes that fights chronic infection.
Lasting effect
In diseases where the immune system has
launched an attack on the body, the Th17 pathway
only attacks the rogue cells and not the healthy cells,
leading to longer remission. Th17 pathway is a subset
of a type of white blood cells discovered only in 2007
and is now understood to play a key role in auto-im-
mune diseases.
When someone has psoriasis, for example, an anti-
gen (bacteria, virus, parasite, etc.,) is presented to a
“T cell”. The principle function of the T cells (Th1,
Th2, Th17) is to launch a response against this anti-
gen or foreign body attacking the immune system.
What ends up happening is that when the T cell is
presented with this foreign threat, it releases cy-
tokines (molecules that act as messengers between
cells). The cytokines kill the infection using the Th1
pathway or Th17 pathway.
The drug not only works, its effect lasts.
“As we started developing this molecule, we real-
ized that the Cubans had very little understanding of
the molecule. They were going down the “Th1” path
so our initial focus was along Cuban understanding.
As we were developing the product, during Phase 1
and 2 studies (for RA and psoriasis), we got good in-
dicative results,” Mazumdar-Shaw said.
“We decided on a Phase 3 study for psoriasis be-
cause it was the easiest and had visible end points.
When we looked at all things we were measuring, we
realized that certain results were unexpected. That
was our serendipity moment,” she added.
The researchers soon realized that the molecule
appeared to be treating cells that were not even being
monitored.
“We suddenly found that certain types of cytokines
which were never even factored were being regulated
by this anti-CD6. We realised that this actually works
in the Th17 pathway.”
Auto-immunity
When the immunity works flawlessly, these cy-
tokines kill the antigen and go back to a nascent stage
until another threat is presented. But in auto-im-
mune diseases, the body launches a response against
its own healthy cells.
“In auto-immune diseases, the cycle of attack does
not stop and constantly the body is attacking itself.
Earlier, the Th17 pathway was not unknown. Now,
the scientific community knows that using the Th17
pathway, it can fix the immune system—stop the
body from attacking itself—instead of treating or
mopping up symptoms that are presented as the
body constantly attacks itself,” said Abhijit Barve,
head of research and development at Biocon.
The Th17 pathway was discovered in 2007, but
“clinical transformation” of this discovery was yet to
be elucidated.
Biocon’s Eureka moment coincided with a global
movement in which the value of the new science in
auto-immune diseases was being crystallized. The
new approach has caused a shift in cell-mediated im-
munity with increasing evidence suggesting that it
may play an important role in the pathology of im-
mune-mediated diseases.
Only, unlike other researchers across the world,
Biocon had data coming from Phase 3 of psoriasis tri-
als to support an otherwise heavily theoretical re-
search.
According to experts, many companies are now
looking to develop drugs using the Th17 pathway.
“World over, a lot of work is being done to under-
stand this pathway and its role in auto-immune dis-
eases,” said S.P. Byotra, head of the department of in-
ternal medicine at New Delhi’s Sir Ganga Ram Hos-
pital.
Unravelling the pathway
“This new science is fascinating and gives hope in
treating diseases like cancers and even HIV/AIDS if it
is understood why the immune system acts the way it
does,” Byotra said.
“Earlier, diseases like tuberculosis and plague were
also considered untreatable mass killers. the Th17
pathway will be crucial for over 200 auto-immune
diseases so obviously all companies are looking at
ways to develop drugs along this method. The proc-
ess will be long-drawn but it could prevent a lot of
diseases considered untreatable now,” he said.
Unlike Alzumab, most drugs mop up nasty cy-
tokines. Simply put, the older drugs addressed symp-
toms of psoriasis such as dryness and red patches in-
stead of tackling the cause of the disease. Prior to Al-
zumab, patients were relapsing within 8-10 weeks.
“Suddenly, we were the most advanced players in
their field,” added Barve. “This pathway is still being
unravelled. The disease quickly comes back with the
older drugs whereas our drug actually starts regulat-
ing the Th17 pathway and stops disease from devel-
oping. This new pathway stops the nasty cells. Our
drug basically fixes the problem with the immune
system and not cleaning up skin, hence the long re-
mission.” he said.
As things stand now, Biocon is perhaps the only
company in the world—certainly the only company
in Asia—to have clinical data to support work in this
area. Following the success in treatment of psoriasis,
Biocon has already received approvals from the Drug
Controller General of India to conduct trials on rheu-
matoid arthritis. Animal model studies on multiple
sclerosis have shown promising results.
While the same “mechanism of action” could be
applied to a spectrum of auto-immune diseases, the
combined market for therapies to treat psoriasis,
rheumatoid arthritis and multiple sclerosis is worth
over $20 billion.
Biocon will have patent coverage for the technolo-
gy till 2030. The company is currently looking for
partners to expand commercialization of the therapy
around the globe.
“It will depend on who we partner with and how
we choose to commercialize this. One thing is cer-
tain—we have a blockbuster on our hands,” said Ma-
jumdar-Shaw.
KIRAN MAZUMDAR­SHAW/ BIOCON
INNOVATION ENVIRONMENT IN
INDIA IS STILL VERY DIFFICULT
INTERVIEW
Seeking cure: Experiments underway at one of the labs at
Biocon Research Centre in Bangalore.
BIOCON’S EUREKA MOMENT
PHOTOGRAPHS: ANIRUDDHA CHOWDHURY/MINT