Repeat founder Todd Zion, PhD is back to update us on exciting developments at his second biotech startup, Akston Bio. We also geeked out a bit on how these magical proteins are concocted in the company’s bioreactors. Fun and instructive chat with a stellar founder.
Highlights:
Sal Daher Introduces Todd Zion
Akston Bio's Founding Story
"... The antigen in this case is the person's own insulin..."
"... you're still taking advantage of that antibody portion, but you've neutered it so that it no longer alerts the immune system, but it retains one property that antibodies all have, which is the ability to recycle and last for very long periods of time in circulation..."
"... We took the veterinary candidates and we partnered those with a company called Dechra Pharmaceuticals, PLC. They're one of the leaders in veterinary pharma development and this is all in the public domain..."
"... We made a pivot at that point saying, 'Well, what if we just go back to the portion of the antibody that interacts with the immune system and make ourselves a vaccine against COVID-19 using the same exact technology?'..."
"... you're going to continue involved in manufacturing, or are you just going to buckle down in the veterinary space and spin off these other technologies to other players?..."
"... if you're not pivoting at least once in your development, you're probably doing something wrong..."
Todd's Funding History
"... what goes on in a bioreactor, which is the heart of what you're doing? Geek out a little bit of bioreactors..."
"... there are these companies that do nothing but transfect CHO cells to produce particular types of protein..."
Energesis
ANGEL INVEST BOSTON IS SPONSORED BY:
Purdue University entrepreneurship
Peter Fasse, patent attorney at Fish & Richardson
Transcript of “More Magical Proteins”
Guest: Todd Zion, PhD
Sal Daher: I'm really proud to say that the Angel Invest Boston podcast is sponsored by Purdue University Entrepreneurship and Peter Fasse, patent attorney at Fish & Richardson. Purdue is exceptional in its support of its faculty, faculty of its top five engineering school, in helping them get their technology from the lab out to the market, out to industry, out to the clinic.
Peter Fasse is also a great support to entrepreneurs. He is a patent attorney specializing in microfluidics and has been tremendously helpful to some of the startups in which I'm involved, including a startup, came out of Purdue, Savran Technologies. I'm proud to have these two sponsors for my podcast.
[music]
Sal Daher Introduces Todd Zion
Sal Daher: Welcome to Angel Invest Boston, conversations with Boston's most interesting angels and founders. Today we are really privileged to have back with us, Todd Zion. Say hi, Todd.
Todd Zion: [laughs] Hi, Sal, and hi to the audience. It's a pleasure to be back with you.
Sal Daher: Yes. Todd is a rockstar in the biotech circles here in Boston, founded and exited very, very interesting company to Merck, which is the subject of the first interview that I had with him. The first sale was half a billion dollars. He went off and founded Akston Bio which is in the business of producing protein-based therapies, vaccines, and so forth.
They were really, really, really good at manufacturing biological materials, proteins, and then now, Akston is doing something really, really interesting. They're spinning off some other programs to really buckle down on their core business, which is going to be to create proteins for various therapies for the veterinary business, which is really interesting because that's a little served area in terms of protein production.
Anyway, Todd, tell us the story here. Tell us a little bit of the trajectory. You founded Akston. You had these vats and things that you're making proteins in. Maybe you can go a little bit what it is that you do to make proteins. Do that later, but anyway, just tell me the strategic thing here. Let's make Norm Birnbach happy and give the strategic message here.
Todd Zion: Sure.
Sal Daher: Norm Birnbach is the excellent PR guy who put us together.
Akston Bio's Founding Story
Todd Zion: Yes. No, that's a great intro, Sal. I think that the founding of Akston was really around developing a protein drug development platform. It started out with somewhat humble beginnings looking at insulins again, which by the way the first company that you mentioned was to develop a smart insulin for treating diabetes. Obviously, going back to our roots and thinking about ways in which we could engineer insulin to achieve different outcomes was top of mind.
That got us developing this platform we call Ambifect now, but at the time, it was basically sticking a protein of interest onto the working part of an antibody to create what is essentially a fusion protein. In that particular instance, with insulin, we had a partnership with the NIH and The Helmsley Charitable Trust to create essentially an insulin that would work on autoimmunity as it relates to the development of type 1 diabetes in young children.
Not to go too off on a tangent there, but one of the first things that goes wrong in childhood diabetes is your immune system starts to essentially recognize self as foreign and in some cases, your own insulin and that leads to a cascade of events that ultimately destroys the cells that actually produce the insulin leading to a lifetime of insulin dependence. By engineering the antibody with insulin, we're able to interact with the immune system in a way to disrupt this.
Sal Daher: Cool. What you're attempting to do is create an insulin that the kids' body doesn't have an autoimmune response to.
Todd Zion: Well, it's even further than that. It goes in and it uses the insulin portion to track the cells in the immune system that have gone rogue against insulin and tag them with the antibodies so that the body just goes and eliminates them.
Sal Daher: [laughs] That's amazing. You're putting out contracts on rogue cells.
Todd Zion: That's right.
Sal Daher: You're like a mafia don, a mafia boss.
Todd Zion: That's right. Yes. For good outcomes.
Sal Daher: Yes. For good outcomes. Exactly.
Todd Zion: Yes.
Sal Daher: This is so cool. The antibodies you're putting on there, is there a particular type of antibody that you're putting on or is it just a random antibody that is not the kid's antibody or the patient's antibody?
"... The antigen in this case is the person's own insulin..."
Todd Zion: Right. The part of the antibody, it's called the Fc region, but it's the part of the antibody that is not specific for a target. It's the functional part of the antibody. Essentially, we've grafted onto it a special insulin molecule that can do the seeking out for the contract hit, if you will, and then the business end of the antibody, that Fc region is what interacts with the immune system to say, "Hey, I found something that shouldn't be here." That's really that part of the platform.
One of the cool things about it is that it's specific for the insulin, which is the insulting agent in many of the young people that develop autoimmune diabetes. Whereas a lot of the treatments that have been tried for this disease have been general immune system disruptors. That's a very dangerous thing to be doing in young children if it's not specific to the actual autoimmune disease. This is part of a class of what they call antigen specific immune disruptors because we're using the insulin as the targeting function.
Sal Daher: Antigen is something that triggers the immune system.
Todd Zion: That's right. It's generally specific for a particular molecule or function.
Sal Daher: Right. The antigen in this case is the person's own insulin.
Todd Zion: That's right.
Sal Daher: I didn't know that. I had no idea.
Todd Zion: Then ultimately that kicks off a cascade of other antigens that are generally specific for these eyelets and these beta cells that produce insulin. The end result of this autoimmune process is destruction of those cells by your own immune system. Then obviously, like I said, a lifetime of dependence on insulin that's no longer being made.
Sal Daher: This is a marvelous digression because I've learned from it. Getting back together to the strategic significance of this, you have this wonderful program which is capable of, has the potential to help protect kids from type 1 diabetes, to keep them from becoming allergic to their own insulin.
Todd Zion: That's right.
Sal Daher: Pulling off their eyelet cells and beta cells in their pancreas which produce the insulin, and they're incapable of producing insulin. You feel that that can be better developed in another entity.
Todd Zion: Well, I think that's a great segue into-- Even what we were thinking going back now, six or seven years ago, that product was being developed-
Sal Daher: SmartCells.
"... you're still taking advantage of that antibody portion, but you've neutered it so that it no longer alerts the immune system, but it retains one property that antibodies all have, which is the ability to recycle and last for very long periods of time in circulation..."
Todd Zion: No, no. I'm sorry. The one that I just described within Akston was being developed as our first foray into other proteins. What we recognized is that the marketplace for type 1 diabetes specific drugs was very difficult to break into without taking something all the way through maybe phase 2 clinical trials. Because you can imagine that you're talking about autoimmunity. Yes, there are mouse models and they've worked very well in mouse models, but the world is aplenty with molecules that did well in mice and never did anything in people. The field of type 1 diabetes has had its own share of failures of promising candidates that even went into the clinic and further.
We recognized that that product was going to be a high risk, high reward portion of our portfolio and that we needed to think about some nearer term hits to really justify the business and its investment. That's when we took that platform and modified it to make ultra-long acting insulins that were actually to treat diabetes, both type 1 and type 2 diabetes. There you're still taking advantage of that antibody portion, but you've neutered it so that it no longer alerts the immune system, but it retains one property that antibodies all have, which is the ability to recycle and last for very long periods of time in circulation.
What we created were basal insulins that could last an entire week with a single injection. That program is much easier to assess in terms of, "Well, do you have something that actually works?" You can measure blood sugar in diabetic animals. The models are much more translatable, and we had a lot of experience with that with our smart insulin program. That's what we developed. Even more to the point, one of the animal models you can go to, you can go to dogs and, well, it worked really well, and we thought, "Jeez, rather than bite off the human application right away, there's this robust market for treating diabetes in dogs as well as cats that we should really look into as a business development opportunity." That's what really got us into the veterinary space.
Sal Daher: Wow, this is so cool. The drama of it here that you've been working on this, this has been in the back of your mind, attaching antibodies to insulin molecules and fiddling with it. One way to do it is to alter the immune system's response. The other one is to create a long-lasting insulin. That is so mind-blowing.
"... We took the veterinary candidates and we partnered those with a company called Dechra Pharmaceuticals, PLC. They're one of the leaders in veterinary pharma development and this is all in the public domain..."
Todd Zion: The really cool thing about it is that once you get those working and you understand the mechanisms and the way to make them do either one or both of those functions, you can really start to expand your thinking around the platform. Just when you think about the evolution of the platform, which gets to this strategic decision that you referenced before, we were-- We took the veterinary candidates and we partnered those with a company called Dechra Pharmaceuticals, PLC. They're one of the leaders in veterinary pharma development and this is all in the public domain.
In doing so have created a very robust commercialization program around those veterinary insulin candidates. They're likely to be blockbusters when they come to market in the next few years because the current therapy for treating dogs and cats is twice a day insulin. Most of that insulin is you going to your pharmacy with a script from your vet and paying out of pocket for human insulin. That's tough, especially when you have to do the twice a day injections.
"... We made a pivot at that point saying, 'Well, what if we just go back to the portion of the antibody that interacts with the immune system and make ourselves a vaccine against COVID-19 using the same exact technology?'..."
That program has been growing and we've been making considerable progress over the last four years or so, five years. Then what happened in 2020 was COVID hit and we recognized that the ability to resource the insulin program while all this was going on would be hampered at a minimum and maybe be shut down at a maximum. We made a pivot at that point saying, "Well, what if we just go back to the portion of the antibody that interacts with the immune system and make ourselves a vaccine against COVID-19 using the same exact technology?"
Then having the advantages instead of it being mRNA and have to be deep frozen and all this, it can be kept at room temperature, you can make millions of doses with a single bioreactor. It also has the benefit of building out all of our capabilities using a very timely product concept. That was the last piece of the portfolio puzzle that developed really up until very recently. That product has gone through clinical trials all around the world, Europe, India. We have 20 million doses sitting in a refrigerator here.
It really was a tour de force for the company and, unfortunately, it didn't catch the same wave as the mRNAs and so on, but it's the first of its kind vaccine of this type. Therefore, serves as a wonderful platform to develop future vaccines that don't require such babying and handling the way the mRNAs do.
That's where we sat at the beginning of the year. We've got type 1 diabetes, autoimmune, great product concept, good proof of concept, AKS-452 is the COVID-19 booster vaccine, and then we have these robust ultra-long acting insulins, and it was time to figure out what to do. Are we going to keep them all under one roof or are we going to, as you said, circle the wagons around a strategic plan and figure out how to best maximize value? That's what's led to the recent pivot.
Sal Daher: That is so cool. Just a detail, a protein on the COVID vaccine that you have, what is exactly the protein that you're introducing?
Todd Zion: Yes. That is the receptor-binding domain or the RBD of the SARS-CoV-2 virus. That's right.
Sal Daher: It's not the spike protein?
Todd Zion: It's not the full spike protein, it's the business end of it. The part that actually attaches to our cells and gains entry.
Sal Daher: Right. The receptors for that are present in the lung tissue, heart tissues?
Todd Zion: Yes. The ACE2--
Sal Daher: It's still addressing the ACE2 receptor?
Todd Zion: It is but only on the receptor-binding domain portion of the spike protein. One of the really interesting things about it, and again, we could talk all day also about the COVID-19 vaccine, but one of the really cool things about it is that when administered as a booster, so if you've already received mRNA, and we have studies in Europe showing this, so if you already received for your primary or even your booster an mRNA vaccine, when you give this as a booster, what it does is it broadens out the ability to see variance and increases the ability to neutralize them. One of the things we're looking for investments into a long-term universal booster vaccine that's much more cost-effective and easier to handle that uses this Fc fusion platform, and we're getting some traction.
Sal Daher: When you're saying universal booster, you mean universal to the particular strain of the COVID-
Todd Zion: That's right.
Sal Daher: Okay. For all vaccines?
Todd Zion: Yes, sorry. Universal for COVID-19-related variants, yes.
"... you're going to continue involved in manufacturing, or are you just going to buckle down in the veterinary space and spin off these other technologies to other players?..."
Sal Daher: This is really a wonderful tour de force. I wish I could do a three-hour podcast with you, really go off. One of these really long format podcasting, dig into the stuff but our format is shorter than that. We're prevented from going off too far afield. Great, so basically the manufacturing and all these things, you're going to continue involved in manufacturing, or are you just going to buckle down in the veterinary space and spin off these other technologies to other players?
Todd Zion: Right. When we took a look at the portfolio and what we do well and how to maximize value, we recognized that what was going extremely well at that time was the development and manufacturing of these long-acting insulins for the veterinary market. One of the things that we did early in that process is build out our own clean room, GMP biologics manufacturing facility, which is not something startups usually do. Usually, they rely on CDMOs, third parties out there to do it under contract.
The problem is in the veterinary space, protein-based drugs are just not as common yet. They're like what the human clinical space was at the turn of the millennium around 2000. There weren't that many proteins out there and now there are hundreds and it's tens of billions of dollars a year. Well, that's really where veterinary is right now and we recognize that if we could develop new proteins and manufacture them, that we could really capture a lot of this rising value and I still very much believe in that.
The entry points are these ultra-long-acting insulins but we have a platform that I've described to you that can then go and create either long-acting proteins, for example, GLP-1 for obesity, but also ways in which we can create antibodies against targets that are implicated in disease to replace monoclonal antibodies using the technology from the COVID-19 vaccine.
We said to ourselves, "We really are well positioned here to take advantage of this, and we have a really robust partnership that's helping us advance this platform? We should concentrate on that." That's what led to deciding, "Okay, what are you going to do with the other assets? We're going to spin those out and they're going to go and get their own funding. They're going to be able to find their own risk-reward scenario relative to their market places."
Sal Daher: Wow. This is so cool. Just as an aside here to listeners. Todd Zion is regarded, in the world's capital biotech, as one of the most impressive biotech founders. We can see why here. The fecundity of his brain of coming up with all these different variations for this technology. When did you start missing with this? Is this your doctoral thesis?
Todd Zion: Well, yes. The original company, SmartCells, was licensed out of MIT and really the base of it was my thesis research. That sort of evolved in SmartCells, that company. Obviously, Merck acquired that, but our brains keep working. When we got into Akston, and it's not just me. I have a great team as well. In fact, one of my co-founders is a fellow PhD chemical engineer from MIT, Tom Lancaster.
We thought about ways in which we could further enhance this. I think the one thing about SmartCells that was both risky, but also part of the investment thesis was that it was kind of a one-trick pony. It was a platform underneath it, but it was ultimately to make a smart insulin for treating diabetes. One of the things that we really wanted to do with this next iteration was to be more expansive with our technologies. We could get after a number of different verticals. That's what led to the development of this platform technology.
Sal Daher: It's really fascinating.
"... if you're not pivoting at least once in your development, you're probably doing something wrong..."
Todd Zion: The other thing I wanted to mention is that, and maybe to those who are going through similar things trying to start up their own companies and navigating challenges, I think to not be afraid of pivoting. In fact, if you're not pivoting at least once in your development, you're probably doing something wrong. There's no honor in entrepreneurship of going down with the ship.
You really do need to navigate based on data, like real scientific data, as well as market data, and really make sure that you're navigating properly. If that means deviating sometimes significantly from that original vision, as long as it's backed by solid data and market research, don't be afraid to at least consider it. If not, ultimately do it.
Sal Daher: This is extremely valuable advice and it's a sort of question that I should be asking more. Pivots used to be a big topic in the early seasons of the podcast. We're in the seventh season now. My mentor and angel investor Michael Mark, at the time, he'd invested in 200 companies. He could think of one of them that hadn't pivoted. All the other 199 had pivoted. That's in the information technology software business. In biotech, the same thing applies. Of course, in biotech you are anchored by your platform, by the technology of your platform. Basically, it's kind of like going in one use case or another use case and emphasizing one or emphasizing the other.
I'm on the board of Savran Technologies, which is an ultra-rare cell company. It's a microfluidics platform. Once again, it's the same thing. Çağrı Savran, the founder, has been very good at looking at different use cases that are the ones that are most consonant with demand from the market, which is strategic players. This is excellent advice. Yes, biotech can pivot. If you're a therapy company, if you have a one molecule that you're trying to-- it's a different story.
Todd Zion: It is. I think, too that you're right about the platform. Something has to be foundational that is very difficult to actually change when you make that pivot. The one thing about biotech, if you're doing it right, is it's much more capital intensive than say your information technology space. That has advantages and disadvantages. Certainly, when you start to develop workflow, physical infrastructure, patents, in order to retain that value as you pivot, you can't go too too far away from it.
Certainly, thinking about market applications, edge cases, uses of the technology that might be able to fund a more broad expansion, you got to be aware of opportunities like that, especially in environments where funding is less plentiful. I'm not sure how much you've been talking about this, I imagine a bit, about the current environment, although it may be warming up a little bit, but this past year has been quite difficult out there.
Sal Daher: Biotech winter, yes.
Todd Zion: Yes, and those who are only dependent on equity financing can find themselves in a very, very difficult position, whereas those who have partnered up some of their assets to bring in some revenue, maybe brought in grants to support some earlier stage high risk projects, maybe even they have some licensing revenue, that creates a much more robust and better able to withstand company for these situations.
Todd's Funding History
Sal Daher: Yes, that's excellent that you touched on that point, Todd, because let's talk a little bit about your funding history. You funded SmartCells with angel money and then I think also you got some grants, foundation money and so forth, and I think a similar mix is at play here again.
Todd Zion: That's right.
Sal Daher: Talk to founders out there, to biotech founders and explain to them the path that you followed because most people think, "Oh, I'm going to go to a VC and get a VC to fund me."
Todd Zion: Yes, and there's nothing wrong with having that in your bag of tricks. You should cast that net wide. That's the first bit of advice I would say is that if you're looking to resource your company, there's no reason to pigeonhole yourself into any one vehicle early on in that process. I think that it's worth it to cast that net wide, but you will find, obviously, that there are trade-offs associated with each of those potential vehicles.
One of the things that we learned very early on at SmartCells, the first company, was that if we were given the capital and the freedom to make our decisions, we could create value in a very efficient way. That meant putting our necks on the line, by the way, but doing that and preserving more of the upside for us. We thought that equation made a lot more sense for us than highly capitalizing the company and giving up the lion's share of that to a different set of management team members potentially and board members.
We found either angel networks or even individual angels combined with, in this case, non-dilutive financing, mostly related to grant money, was a way to find our way through to creating value. That's what we did. We raised $10 million from equity investors and $10 million from grants and sold the thing for half a billion and that was just huge, right? We didn't even need to do that to make that a big success. That was SmartCells.
Now, Akston has relied on a similar model, similar sources of funding, although we've raised $40 million, not $10 million, but we've built what we consider to be a much more valuable and expandable pipeline with that. We've brought in about $40 million of non-dilutive funding through commercial license arrangements related to the vaccine at one point, the veterinary products, grant money, and so on. There's still that one-to-one split here, albeit at a higher level. Again, that's a good mix for us for managing risk and also maintaining some operational control over our fate.
Sal Daher: Yes. I see that through all these cycles, even if the vaccine excursion that you had was not ultimately a huge commercial success, it built the capacity of your company.
Todd Zion: That's right.
Sal Daher: You can do things now that you couldn't do then.
Todd Zion: Yes. I think you're spot on there and thanks for bringing that up. The manufacturing facility that we were building out ostensibly to support the long-acting insulin products, when COVID hit, we ramped that up by 10X, because we needed a facility to manufacture our COVID vaccine should it get approved.
The support, quality control, quality assurance, process development, physical equipment, all of that was going in to the point where even if we never get another dollar from the vaccine, the ability to execute on the long-acting insulins and on the platform beyond is just so much better now than it probably would have been without the COVID acceleration and pivot. You're exactly right. That's one benefit of making sure that you have a solid platform underneath so that even individual assets that you're investing in will always accrue to the benefit of future assets, not 100%, but let's say a significant portion will and that's important.
Sal Daher: This is interesting because Boston, the angels are still very software centric and they forget that in biotech, building infrastructure and also consonant with that, building capacity in management to create the infrastructure, to manage the production process and all of that enriches the company. You not only have a better physical plant, but you also have more capable management, more capable scientists, more capable people in your roster that can do more stuff. Your company is a much stronger company, even if it didn't create a huge top line success.
Todd Zion: That's right. Thank you for that.
"... what goes on in a bioreactor, which is the heart of what you're doing? Geek out a little bit of bioreactors..."
Sal Daher: Thinking about this, let's go the other way. I'm an engineer at heart. Even though I'm not practicing. I never practiced engineering. Explain to me, what goes on in a bioreactor, which is the heart of what you're doing? Geek out a little bit of bioreactors.
Todd Zion: It's funny. A bioreactor is, in its essence, a plastic bag. A very large plastic bag. Or at least our implementation of it. It used to be you do these things in stainless steel vats, and there's still people that do that. One of the key things is that, especially if you're working on multiple products, the regulators are very strict about your cleaning validation procedures. Especially when you switch between products.
The industry has developed what they call single use systems where the shell of the bioreactor is stainless steel. It allows you to control temperature. It maintains integrity, but basically the thing inside it is a bag that blows up that contains your soup for making your product. Then when you're done, you just throw it away and there's no cleaning really. All the guts of it are plastic and disposable. That's the physical composition of it.
What goes on in it is basically, in our case anyway, we have cells. These are called CHO cells, Chinese hamster ovary cells. They are the workhorse of the monoclonal antibody industry, as well as our Fc fusion platform. Before you get into the bioreactor, you start out with a little vial of these cells. These cells are, essentially, barcoded. They are regulated. They're GMP. You have a master cell bank. All future productions are all going to come from the series of these vials. You've got to grow them up, and you can't take a little vial of cells and put them into a 500-liter bioreactor. There's just too much space there. They need to communicate with each other.
You start out with something called a seed train, where you start growing them up in flasks, and eventually you get into a small bag bioreactor. Eventually, when you get to a large enough volume, you can then hook that up to your bioreactor. Then what you have in there is a bunch of, water with a bunch of nutrients and buffer salts and other things in there, and your cells. The bioreactor really is about controlling temperature, the gases. There's oxygen, carbon dioxide. Those can also regulate the pH, but you can also the level of acid or base.
The bioreactor is really mainly this control system that is meant to keep all the cells happy as they're growing, and then eventually in production mode, they're making your protein of interest. This soup of, now your product and a bunch of cells and a bunch of byproducts then needs to be harvested in what we call downstream processing, so that we can ultimately have a clean solution, free from contamination of the product.
The last thing I'll say about this, and why it's really important, all this needs to be done in what's called a clean room facility, because what happens is, if you get one bacteria cell sitting in this soup, along with your cells, the next day you're going to have a bunch of bacteria and not a lot of your cells, and also viruses. If a virus gets in there, they might be able to transfect your cells and produce a bunch of virus, and so you have to have these very strict clean procedures. Not only do you have to do it within an environment that's HEPA filtered to the hilt, but you also have to have downstream processes that ensure the regulators that even if something had gotten in, that you could purify that out
A lot of the production of these biologics is really related to making sure you do that cleanly, and without contamination. You're doing that at 500-liter, 1,000-liter scale, which for chemicals production is nothing, but for biologics is getting you there to the point where running half a dozen of those batches a year could serve the entire dog and cat diabetes market, or at least at a reasonable degree of penetration, so there's high value coming out of these bioreactors with the right products.
Sal Daher: Amazing. It's like very high-end yogurt making.
Todd Zion: It's kind of like that. Not as thick, hopefully, if it's gone well. There are people out there that do fermentation, so they use bacteria cells to make their products and yeast cells, but for our platform, the CHO cells are really the best choice to get the quality product that we're looking for.
Sal Daher: What's going on with the CHO cells? They're just turning out proteins from the ribosome? Somehow you control the ribosomes inside them, and they just--
Todd Zion: In the early days, when you think you have a product candidate, you map it out and you say, "I want this protein. I want it to look like this." You take, or a third party in our case, transfects the DNA for that protein and inserts it into the genome of the CHO cell. That stably transfected cell now is secreting that protein of interest. These CHO cells, they come from cell lines that have been engineered over the years to really amplify production, clean production of monoclonal antibodies, and in our case, fusion proteins. That cell then becomes the source of that master cell bank that I described to you before. It's all characterized, it's genotyped, everything's in there, you know exactly what it is, and then from that point forward, that's what's making your product.
Sal Daher: Basically, you go to a CHO cell vendor.
Todd Zion: Yes.
Sal Daher: The transfection, cell transformation, that means getting genetic material into the nucleus of a cell and changing the function of the cell.
Todd Zion: That's right.
"... there are these companies that do nothing but transfect CHO cells to produce particular types of protein..."
Sal Daher: It's a very important process in biology, the idea of changing how a cell functions, cell engineering, and so there are these companies that do nothing but transfect CHO cells to produce particular types of protein. It's amazing because in biotech, there's all these sub-industries, there's a whole industry to do transfection with electrical methods, and then there are chemical methods, and then there are physical methods for transfection.
Todd Zion: That's right. Or even just making the insert cartridge of the DNA, right? There's another industry you go to, and that's not usually the ones who transfect it, they order it from this other industry that does that, and then there's a whole industry on characterizing those cells to satisfy regulators. Yes, you're exactly right, there's a wonderful ecosystem, and we could spend hours talking about that are just built around taking a novel protein, or heck, even just taking a novel antibody and turning it into a drug.
Sal Daher: Well, somebody with more production capacity than I have should do that, should take the whole, how you go from one to the other, because there's so many of these things. I know, for example, like the magnetic tags, there's a whole industry of magnetic tags for tagging cells and it's just so vast.
Anyway, Todd, I'm so grateful to you for making time to talk to a terrified amateur, that's a reference to Gilbert and Sullivan, and explaining this. I could spend hours talking about picking your brain, but your time is extremely valuable. I want to pick your brain on just one more thing. I saw a pitch this week from a really exciting company, Brian Freeman and Olivier Boss have founded a company called Energesis, and basically, they're figuring out a way to activate brown fat in the body so that it can improve your metabolic function. I understand that you're on the board of that company. Do you want to talk a little bit about the promise of Energesis on the podcast? Because I'm going to have Brian on.
Energesis
Todd Zion: Oh, good.
Sal Daher: Give us your take.
Todd Zion: Yes, well, first of all, they say, you bet on the jockeys, not on the horse, or at least primarily. I think both Brian and Olivier are just solid thinkers and doers. I've had the pleasure of knowing them for, gosh, going on a decade here. I think that that's just a huge vote of confidence in them as a team. I think also their approach to the brown fat problem-- in brown fat, if your audience doesn't know about it, but there's white fat, which is the stuff we hope we don't have a lot of at any given time, but brown fat is really highly metabolic, and it essentially burns calories and oftentimes to provide heat.
People who are of Eskimo lineage, for example, and live in very cold climates tend to have very high concentrations of this and they can take in 8,000 calories a day and not really gain too much weight. It's been a holy grail about how can we adapt this to human use? What they have is a platform that can tell you whether a drug of interest can take precursor cells that are in our bodies and turn them into brown fat cells. This is something that they've licensed in and developed on their own.
They have that around and they've done an approach where they can do de novo molecules that they generate, protein libraries that are out there, and even approved drugs that aren't necessarily approved for this use or combinations thereof that can affect this result. Then they can test it out in animal models and so on. What's really exciting is they've identified a unique combination of drugs that are out there that have really good safety profile that contribute to weight loss without curbing appetite.
I think that that's the other piece of this is you hear a lot of talk about the other weight loss drugs, the GLP-1s and that's all well and good, but you stop taking them and your appetite comes back. These have the ability, potentially, to really create a new metabolic state that can handle a higher calorie count. I think that's what's really exciting.
Sal Daher: Or be used in conjunction with the GLP-1 agonists.
Todd Zion: That's right. In fact, I think that is going to be at least the first market application. I know they're raising money now to get toward a clinical trial that they have planned to show just that, the use alongside the GLP-1s. It's incredibly exciting. From an angel investment opportunity, not a lot of these come along, where the capital requirements are maybe a couple million dollars at most, and the end result is phase 2 clinical data on patent protected combination molecules. Gosh.
Sal Daher: Which would be in the hottest field, which is obesity treatment. This is tremendous. Well, Todd, see on tour de force, we touched all the bases here. We talked about your strategic pivot, we got into the nitty gritty, what goes on in a bioreactor we got into the little bit of biotech industry, and then we touched on a nascent startup. This is a tremendous podcast. Excellent use of your time, despite the fact that you are working on stuff that's so important for humanity. I'm very grateful to you for taking the time to be on the Angel Invest Boston podcast.
Todd Zion: Oh, it's been my pleasure, Sal. Thanks for inviting me again.
Sal Daher: This is Angel Invest Boston. Thanks for listening. I'm Sal Daher.
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I'm glad you were able to join us. Our engineer is Raul Rosa. Our theme is composed by John McKusick. Our graphic design is by Katharine Woodman-Maynard Our host is coached by Grace Daher.