When Bob Kay was lured in 1998 to take the helm of Origen Therapeutics, the company had an exciting platform technology it was working on. The plan was to genetically engineer chickens to both produce protein therapeutics that could be purified from their eggs and to also alter chickens so they produce novel human polyclonal antibodies to target cancers, infectious diseases, and autoimmune diseases.

 

The company had funding from angel investors, but venture capitalists didn’t have much interest in putting money in an early-stage, high-risk platform technology that was not yet proven. And then when 2001 rolled around, raising money got particularly ugly. As young biotechnology companies find themselves neck deep in ugly today, it might be worth looking at Origen and how it’s managed to get through the past ten years without venture capital funding, even if it wasn’t entirely for a lack of trying.

 

Recently the Emeryville, California-based company announced the first two commercial deals in its history. This month, the company entered into a strategic collaboration with Denmark-based Symphogen to develop transgenic chickens capable of producing human antibodies against a wide variety of disease targets. Origen will use its technology to develop transgenic chickens, while Symphogen will apply its antibody discovery and expression platforms to create novel recombinant fully human monoclonal and polyclonal antibody therapeutics against targets for such things as cancers, infectious diseases and autoimmune diseases. Both companies plan to employ the jointly developed transgenic technology to produce novel antibody therapeutics.

 

Though the companies did not disclose financial terms of their agreement, they said both companies will provide funding for the development of transgenic, human antibody-expressing chickens using Origen’s technology. Origen will receive upfront license payments and further payments upon reaching defined research and development goals. The two companies will pay each other royalties on products arising from the technology. Once human antibody-producing chickens are developed, both companies will hold rights to develop products from those birds. In addition, Symphogen will have the right to purchase exclusive access to the collaboration technology for use to generate human recombinant antibody products.

 

In a separate agreement this month, the company said it licensed its technology to Auckland, New Zealand-based Genavia Therapeutics. Genavia will use Origen’s transgenic technology for the production of therapeutic proteins in chicken eggs. The patent-protected technology has been shown capable of producing in eggs high-value therapeutic proteins that are currently produced by expensive cell culture manufacturing processes. Financial details of this agreement were not disclosed, but Genavia will initially apply the technology to produce human Factor VIII an essential clotting factor and is missing in the blood of hemophilia A patients. In the United States, FVIII treatment can cost up to $200,000 per year. Worldwide sales of Factor VIII in 2008 exceeded $5 billion. Largely as a result of the cost, the majority of the world’s hemophilia patients remain largely underserved with the World Federation of  Hemophilia estimating that 75 percent of the world’s hemophiliacs go untreated. Genavia believes that by producing Factor VIII using the Origen avian transgenic technology, the cost of treatment might be reduced to as little as 20 percent of the current market price.

 

Origen has invested more than $20 million in the development of its platform technology to date. About half of that money has come from angel investors, and half has come through government funding such as the Small Business Innovation Research and Advanced Technology programs.

 

Origen’s success in obtaining grants came from Kay’s experience gained as vice president of research and development at GenPharm International.

 

“Whenever a new scientist joined the company, I would give them the job of writing a grant,” Kay says. “It’s a great way to get young scientists to think hard about what we’re asking them to do, by putting it down on paper, and also to get peer review for their thoughts and approaches and to get that feedback from their peers in the review process of the grant,” says Kay, who has continued the practice at Origen. “It gives them a sense of ownership.”

 

Kay says that grants are not a way to proceed forward with no other source of investment, but it gives the investors some bang for their buck and is a means, in some cases, of funding quite high-risk technical challenges that might otherwise be very difficult to get funded. Now with two deals that offer some validation to Origen’s technology, Kay hopes that it will open up new sources of financing for the company – maybe even venture investment.

 

As for advice to fellow entrepreneurs who may be frustrated by a lack of access to capital, Kay says don’t give up.

 

“If you believe in the technology and are sure that what you are doing is important scientifically, commercially, and therapeutically, then if you can, keep pushing that development,” he says, “because eventually people with catch up with your forward thinking.”