Great biotechnology stories have three essential ingredients—science, medicine, and business. Aveo Pharmaceuticals CEO Tuan Ha-Ngoc told me last week that he thinks about these same elements in his quest to build a sustainable company. Few companies ever put together all the pieces, though, and it’s too early to say if Cambridge, MA-based Aveo is one of them.
Until a few weeks ago, Aveo was probably best known for the first piece of the puzzle, the science. It has what it calls a more accurate method for mimicking cancer in mouse experimental models, compared with the traditional “xenograft” approach.
Then, in late May, Aveo made headlines on the medical side, when researchers presented promising results for its lead experimental drug for kidney cancer. The first drug to come from Aveo’s experimental platform, tivozanib (or AV-951) is an oral pill designed to block three specific types of molecules that allow the formation of new blood vessels; tumors rely on new vessels for nourishment as they grow. The study showed the drug could slow the spread of malignancy with minimal side effects. If the data can be confirmed in a larger trial to start later this year, Aveo’s drug could be in a position to compete with Pfizer’s sunitinib (Sutent) and Bayer and Onyx Pharmaceuticals’ sorafenib (Nexavar), which combined pulled in $1.5 billion last year.
But even if things go right, Aveo won’t have its moneymaking drug on the market until 2012 at the earliest. So if you’re Ha-Ngoc, how do you keep the business moving forward for years when venture capital is hard to come by? You keep 100 percent ownership of your crown jewels in North America, find partners to commercialize them elsewhere, all structure the deals so they pay for your R&D engine. Then plow the profits back into R&D and do it again.
“To build a sustainable company, you can’t be a single-product company or a single-indication company,” Ha-Ngoc says. “We want to be a full-fledged company.”
The Aveo story began in 2002. The company spun out of the lab of Ronald DePinho and Lynda Chin at the Dana-Farber Cancer Institute in Boston. They started with the premise that since cancer has been cured many times in mice, and never in humans, maybe the existing mouse models for the disease could use some improvement. The conventional
