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March 19, 2009
Philippe Breton- Marie Delattre- Hélène Delvert- Juliette Morawiec
Monogram Bisociences-Overview
3




Biotechnology company founded in 1995
Based in San Francisco
Molecular diagnosis in HIV and Oncology
Clinical Reference Laboratory –CLIA Accredited
CLIA - Clinical Laboratory Improvement Amendments
4


Regulates all laboratory testing performed on
humans in the U.S through CLIA
Ensure quality laboratory testing since 1988
Mission
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“To improve healthcare by advancing individualized
medicine through the discovery and
commercialization of innovative products to guide
and improve the treatment of HIV, cancer and other
serious diseases.”
Overview
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


382 employees:
70% research employees primarily focus on
oncology programs
2008 revenues : 62,193 m$
How it all started….
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1995
based in San
Francisco
Base Business in
HIV
Dec 2004 : Merged
Expansion to Oncology
Sept 2005
Opportunites Throughout the Continuum
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Partners of Choice
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2000
2002
2005
2008
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JP Morgan Healthcare Conference, January 2009
Tests
Drugs
HIV drug resistance Tests NRTI
NNRTI
Protease Inhibitors
Monogram Test
PhenoSense HIV ®
GeneSeq HIV®
PhenoSense GT®
Entry(fusion) Inhibitors PhenoSense HIV Entry®
Fuzeon® Roche
GeneSeq HIV Entry®
Integrase Inhibitors
Isentriss® Merck
GeneSeq HIV Integrase®
HIV drug development
PhenoSense HIV®
Antibody
Neutralization
PhenoScreen®
CCR5 antagonists
Maraviroc® Pfizer
Trofile®
Co-Receptor Tropism
Tests for Use in HIV Drug
Development Programs vaccine development
Tropism Patient
11 Selection Test
PhenoSense HIV Integrase®
12
HIV Drug resistance testing
How does resistance develop?
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
Selective pressure from drugs or from the immune
system.

When HIV replication
is not fully suppressed
Viral load
Treatment begins
(poor adherence/absorption, varying PK).
Drug-susceptible quasispecies
Drug-resistant quasispecies
Selection of resistant
quasispecies
Incomplete suppression
• Inadequate potency
• Inadequate drug levels
• Inadequate adherence
• Pre-existing resistance
Time

Transmission of HIV resistance strains

Resistance can be contained


by an appropriate and careful choice of treatment
by monitoring for resistance.
Monogram’s Resistance Assays
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
Phenotypic HIV drug resistance assays


Quantification of drug concentration needed to inhibit HIV replication
Genotypic HIV drug resistance assays


Identify whether specific mutations are present
Resistance inferred through an algorithm or database analysis
From CliniCareOptionsTM, Genotyping vs Phenotyping: Which Test When?
Monogram’s Resistance Assays
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
Drug resistance testing for healthcare professionals

establish the patient’s HIV drug resistance profile
“virogram” to all approved ARV
Tests
HIV drug resistance
Tests
Drugs
Monogram Test
NRTI
NNRTI
Protease Inhibitors
PhenoSense HIV ®
Entry(fusion)
Inhibitors
Fuzeon® Roche
Integrase Inhibitors
Isentriss® Merck
PhenoSense HIV Entry®
GeneSeq HIV®
PhenoSense GT®
GeneSeq HIV Entry®
PhenoSense HIV Integrase®
GeneSeq HIV Integrase®
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Drug Development testings
PhenoScreen™ HIV Novel Drug Screening
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

A phenotypic screening assay
Developed in response to customer demand:
“Secondary screening”
Economical way
 Quickly
 Cost-efficiently
 Well-characterized library viruses

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TROFILE ASSAY
TM
Background :HIV viral entry
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
Viral Entry is mediated by chemokine receptors :
CCR5 or CXCR4
What is tropism?
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

Tropism refers to which co-receptor the patient’s
virus uses to enter the CD4+ T cell
4 HIV-1 strains:

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CCR5-tropic
CXCR4-tropic
Dual (D)-tropic
Mixed (M)-tropic
CCR5
tropic (R5)
CXCR4
tropic (X4)
Dual/mixed
(D/M)
Dual
tropic
Mixed
tropism
Blake Max, PharmD, RMR CORE Center, Clinical Assistant Professor, UIC College of Pharmacy
CCR5 antagonists : Maraviroc
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Maraviroc- Selzentry® developed by Pfizer
1st in class, approved August 6, 2007(US)
CCR5 antagonist:
 Blocks the CCR5 chemokine receptor on the CD4+ T cell to
prevent entry of the R5 tropic HIV-1 virus.
 not effective if virus is X4 tropic or Dual/Mixed (D/M)
tropic.
The patient’s HIV tropism
must be determined
before prescription!
Pfizer chose Trofile assay
TM
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
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Partnership since 2002 for development of Trofile test
Trofile used in all Selzentry Clinical trials
Trofile used before Prescription
Currently the only CLIA-validated tropism assay
available
Trofile assay mechanism :
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Bioluminescence detection
Patient derived
HEK
293
cells
©2007 Monogram Biosciences, Inc
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Trofile characteristics
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Accurate, precise, reproducible
PCR amplification sensitivity :
95 % when Viral load ≥ 1000 copies/ml
The whole of gp160 is used
No differentiation between dual-tropic & mixed-tropic
viruses
Dual/mixed
(D/M)
Dual
tropic
Mixed
tropism
Detection of minor X4 species
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
Original Trofile test could not detect low levels of X4
strains


Sensitivity 100% when 10% of population is CXCR4
Sensitivity 83% when 5% of population is CXCR4
Enhanced version in June 2008 :

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100% sensitivity of X4 virus as low as 0,3%
Clinical validation through retrospective analyses of
Vicriviroc phase II and Selzentry phase III trials
Trofile major disadvantages
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Accessibility : only done in San Francisco
 Time (2-4 weeks)
 Cost :$2,000



Reimbursed by Medicare/Medicaid…
Outside of the US : paid by Pfizer
Trofile opportunities :
« The Collaboration Agreement »
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
May 2006, expires on December 31, 2009, renewable by Pfizer for
five successive one year terms
Monogram
• making Trofile available within the U.S
Pfizer
• sales, marketing and regulatory matters outside of the U.S
• pays Monogram for each assay
• will reimburse Monogram for costs to make the assay available.
In 2008 : Trofile revenues due to Selzentry: over $16 million.
Trofile opportunities :
Entry Inhibitors Pipeline
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CCR5 antagonists
CXCR4 antagonists
Vicriviroc
Schering Plough
phase III*
PRO140
Progenics
Phase II*
SCH 532706
Schering Plough
Phase I
TBR-652
Tobira Therapeutics
Phase I
AMD 11070
AnorMED
Phase I*
*trials with the Trofile assay
Threats : other tropism assays
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


Homebrew tests
Genotypic tests : quicker, cheaper, easier to realize.
Competitors :
 Virco
 Phenoscript™(VIRalliance)
 Sensitrop
II (Pathway diagnosis)
 ViroTech (Invirion) used for SCH 532706 ScheringPlough phase 1
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Targeted cancer therapeutics
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
designed to block activated protein
pathways that are driving :
cell proliferation
 tumor development


less effective if :
the patient lacks the target protein
 the target protein is not “activated”
 there are several activated pathways

Patient selection testing
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
which pathways have been activated and are
driving cancer cell growth ???

measure cancer drug targets in their activated
state

focused on the EGFR/HER receptor family
Beyond Chemotherapy
Signaling Cascades of Angiogenesis
Extracellular space
Integrin


Cell membrane
Ligand
VEGF receptor
C-src
Ligand ERBB receptor
Farnesyl transferase
STAT
PI3K
Activated tyrosine kinase
Akt
ras
mTOR
raf
MEK
MAP kinase
VEGF
PDGF-
ERK
Cytoplasm
HIF-1
Nucleus
Martin L, et al. J Clin Oncol. 2007;25:2894-2901. © 2009 American Society of
clinical Oncology. All rights reserved.
clinicaloptions.com/oncology
Beyond Chemotherapy
The EGFR Superfamily of Receptors
HBEGF
AR
ß cell
TGFα
EP
NRG2
NRG4
NRG3
NRG1
AR
ERBB1
EGFR
ERBB2
HER2
ERBB3
HER3
ERBB4
HER4
TK
TK
X
TK
clinicaloptions.com/oncology
Beyond Chemotherapy
EGF Binds to Receptor Resulting in
Dimerization and Autophosphorylation
EGF
EGF
TK
TK
EGF
TK
Increased cell proliferation,
inhibition of apoptosis,
neoplastic angiogenesis
pY
TK
pY
pY
pY TK
pY
pY
Activation of
intracellular signaling
molecules
clinicaloptions.com/oncology
An example : breast cancer
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
HER2 amplified (HER2+) in 25% of breast cancer
high levels of a 185kd glycoprotein with tyrosine
kinase activity
 more agressive
 different treatment

Routine testing of HER2
recommended on newly
diagnosed and metastatic
breast cancer since 2001
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JP Morgan Healthcare Conference, January 2009
How VeraTag works?
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Multi-labeled antibodies are
Activation of "molecular scissor"
Released VeraTag reporters are
directed to different epitopes on
liberates singlet oxygen, cleaving
quantified by capillary
the same or associated protein
all tethers within a designated
electrophoresis
partner
range
Their 1st test
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
introduced commercially in July 2008
determines patient’s HER2 status :
level of HER2 total protein
 HER2 homodimers

Response to Herceptin
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Strengths
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

very small amounts of tumor samples
prepared in a variety of methods
formalin fixation
 paraffin embedded



permits the quantitative and accurate
measurement of proteins and their activated
forms
specific, sensitive and reproducible
SUPERIOR TO CURRENT TECHNOLOGIES
In the future...
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
additionnal assays to identify Herceptin
resistance


HER1, HER3, HER2:HER3, p95
expansion of clinical applications

assays on HER1 and HER3 now available for
clinical development
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Let’s have a look at the shares…
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Financial assessment: revenues
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80
m$
70
62.193
60
48.252 47.958
50
43.229
40
33.379
30
25.261
18.273
20
7.466
10
0
0.102 1.069
Total Revenue
36.801
Revenues in 2008 from customers
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Costs & Expenses
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146.914
m$
140
120
Aclara
purshase
100
83.744
71.461 73.924
80
61.785
60
45.25 47.261
32.268
40
39.008
18.215
20
3.316
8.26
0
Total costs & expenses
Linear (trend line without aclara purshase)
Repartition of costs & expenses
50
160000
140000
44,8%
120000
39,6%
100000
38,3%
80000
60000
40000
20000
0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
% revenues in R&D
cost of product revenue
R&D
General&administrative
Sales&Marketing
aclara purshase
2008
Financial assessment
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m$
140
Aclara
purshase
120
100
80
60
40
20
0
Total Revenue
Total costs & expenses
Linear (trend line without aclara purshase)
Operating loss
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120000
100000
80000
60000
40000
20000
0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
Forecast
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
An increase of revenue

But not yet profitability…
Investments
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
A good opportunity

Buy now and make money!
 2.60$
to 5.60$ (according to Thompson)
SWOT
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Strengths
Science driven

R&D : VeraTag technology

Leader in HIV test (Trofile)

Many partnerships

Present throughout the continuum

SWOT
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Strengths
Weaknesses
Science driven

Lost of money every year
R&D : VeraTag technology

Bad reputation with shareholders
Leader in HIV test (Trofile)

Low cash flow
Many partnerships





Present throughout the continuum

Presence limited to the U.S
SWOT
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Strengths
Weaknesses
Science driven

Lost of money every year
R&D : VeraTag technology

Bad reputation with shareholders
Leader in HIV test (Trofile)

Low cash flow
Many partnerships





Present throughout the continuum

Opportunities
Development of personalized medicine

VeraTag technology : a universal platform


Oncology market growth
CCR5 antagonists pipeline

The Pfizer Note

Presence limited to the U.S
« The Pfizer Note »
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

Pfizer invests 25 million$ in Monogram through a
Senior Secured Convertible Note
note will bear interest at 3%, payable :
 quarterly


in cash
or Pfizer's option into Monogram Common Stock
will be due on May 19, 2010, unless converted
earlier.
Advantages for both Monogram and Pfizer!!
SWOT
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Strengths
Weaknesses
Science driven

Lost of money every year
R&D : VeraTag technology

Bad reputation with shareholders
Leader in HIV test (Trofile)

Low cash flow
Many partnerships





Presence limited to the U.S
Present throughout the continuum

Opportunities
Threats
Development of personalized medicine

VeraTag technology : a universal platform



Not enough money to continue development
Financial crisis
Oncology market growth

CCR5 antagonists pipeline

The Pfizer Note




Competitors
Patent litigations : Roche and Bayer
Facilities not GMP compliant
IVDMIAs Regulation

The FDA and IVDMIAs
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IVDMIAs
In Vitro Diagnostic Multivariate Index Assays
FDA published its guidance in September 2006
 Require premarket review by FDA
 Must demonstrate analytic and clinical performance of test

The FDA and IVDMIAs
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FDA has taken a bite into the lab
developed test marketplace!
It states 3 criteria meant to distinguish the assays from other
laboratory-developed tests:
 the use of clinical data,
 an algorithm,
 and a result that requires the test developer help to interpret.
Our opinion on Monogram’s future
62



Pivotal years ahead of them
Succeed into a profitable Diagnostic Business
Model?
Bought by Pfizer?
THANK YOU FOR YOUR ATTENTION!
ANY QUESTIONS?
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Determination of tropism :Trofile assay
TM
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Isolate patient’s
RNA
RT
envcDNA
PCR ampliation
Env senquence
Expression vector