The first five minutes of digging on Portland, OR-based AVI Biopharma turns up some jaw-dropping facts. It’s been in business since the dawn of biotechnology in 1980. Never has it developed an FDA-approved drug. Never has it become profitable. It has burned through $243 million in investor capital in its history, according to its most recent quarterly report with the Securities and Exchange Commission.
As you can imagine, AVI Biopharma (NASDAQ: [[ticker:AVII]]) has to reinvent itself to stay in business. I spoke with new CEO Leslie Hudson, who began his turnaround effort in February. He comes to the company after stints as a CEO at two small-cap biotechs, Nabi Biopharmaceuticals and DOV Pharmaceutical.
The aim here, Hudson says, is to dedicate the company to developing new drugs instead of just honing its technology. AVI is now putting its resources into a wide variety of therapies: RNA-based drugs against Duchenne Muscular Dystrophy, a treatment to stop excessive scarring around stents that prop open clogged arteries, and drugs that might save people’s lives after being exposed to the deadly Ebola and Marburg viruses. He’s going to show off his new plan to investors at an event in New York today to lay the groundwork for raising some more capital. The company had about $18.8 million in cash and investments at the end of June, and 85 employees working to make it happen.
“We are re-positioning an antisense pioneer as an RNA-based therapeutics company,” Hudson says. “The technology is superb. The challenge was in leadership and business planning. So many companies limp around with old drugs that never get around to crossing the finish line. Our job is to bring two or three of these to fruition.”
Hudson makes it sound like he’s been dealt a great hand at AVI. His company’s drugs can bring the kind of specificity seen with drugs that work by gene-silencing, or RNA interference, like those being developed by Cambridge, MA-based Alnylam Pharmaceuticals (NASDAQ: [[ticker:ALNY]]). AVI thinks its drugs have an edge because its drugs are easier to deliver to tissues throughout the body, easier to manufacture because they are conventional small-molecule chemicals, and can remain active for longer periods in the body.
Wall Street sees this all a little differently. The scoreboard says Alnylam’s market capitalization is $1.1 billion. AVI Biopharma’s is $82 million.
