Biotech companies can be resilient little animals, and one example in Seattle is Oncothyreon (NASDAQ: [[ticker:ONTY]]). This company looked like a goner a little over a year ago, when it was down to its last few months of cash and its stock was trading for less than a buck.
Somehow, when his back was against the wall, CEO Bob Kirkman found a way to renegogiate a deal with partner Merck KGaA a year ago which brought in $13 million, shifted the expense of manufacturing a cancer vaccine called Stimuvax off his books, and still retained a “double-digit” percentage royalty on sales if it becomes a marketed product.
But that wasn’t all. By April, Seattle-based Dendreon came along and shocked the cancer research world by proving that its immune-boosting treatment could help men with prostate cancer live longer. Investors were suddenly on the prowl for other companies in this long-suffering field, and they started beating a path to Oncothyreon.
Two months later, Merck KGaA showed more confidence in Oncothyreon’s Stimuvax by plowing ahead into a pivotal clinical trial of patients with breast cancer, before waiting for results from another ongoing trial of lung cancer patients. Oncothyreon’s stock gained enough—from 80 cents on January 1 to $5.06 at yesterday’s close—that the company was able to raise another $24 million from investors and start plotting more aggressive moves for the year ahead.
So much has happened over the past year that I figured it was time to stop by Kirkman’s office in Belltown to bring readers up to speed on what to watch for from this company in 2010. This starts off with some technical stuff about how Oncothyreon’s next generation vaccine is different from Stimuvax, and moves into more business strategy questions later on:
Xconomy: I’ve noticed that you are advancing your second cancer vaccine candidate into the clinic. But at back in March, I noted that it’s been “Goodbye Cancer Vaccines, Hello Cancer Drugs” at Oncothyreon. Has that balance, or emphasis, changed?
Bob Kirkman: It’s changed, partly because we have more resources now than when we had that discussion before. We’ve had follow-on vaccine in our portfolio for several years, but frankly, didn’t have the resources to take it forward, nor necessarily the strategic reasons to do so. Both of those are different now.
It’s probably worth talking a little about what’s different and why we’re developing it. There are two main differences between BGLP40 and Stimuvax. One relates to the antigen. The antigen in BGLP40 is a 40-amino acid
