January 8, 2021 • 41 mins
Jonathan Northrup, CEO & Co-founder of Stingray Therapeutics, joins Dr. Verret to discuss the process for starting a pharmaceutical company.
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Announcer (00:00):
Ask me MD medical school for the real world with
(00:03):
the MD Dr. DJ Verret
D.J. Verret, MD, FACS (00:06):
Welcome to Ask me MD medical school for
the real world. I'm Dr. DJVerret. Today we have the
pleasure of being joined byJonathan Northrup, CEO and co
founder of Stingraytherapeutics, a serial
entrepreneur in drug developmentand an industry veteran from Eli
Lilly. We're gonna take a shortbreak and talk to Jonathan about
(00:26):
drug development and startupmedicine right after this.
Commercial (00:31):
Instert Commercial ere
D.J. Verret, MD, FACS (00:46):
Welcome back to ask me MD medical school
for the real world. I'm Dr. DJVerret, and today we're talking
with Jonathan Northrop, who iscurrently CEO and co founder of
Stingray therapeutics. At thesame time, Jonathan has board
positions at two other startupmedical companies who he was
involved with. And he's going toprovide us some insight into
(01:09):
drug development and howphysicians can become involved
in drug development. Jonathan,thanks for joining us.
Jonathan Northrup (01:16):
Well, it's great to be here. Thank you, DJ.
D.J. Verret, MD, FACS (01:19):
So if you don't mind, obviously, we've
we've talked in the past and andif you wouldn't mind, though,
kind of give us an idea of yourbackground and how you got to
where you are today. So ourlisteners can know your, your
extensive industry experience.
Jonathan Northrup (01:34):
Yeah, sure.
So I got a BA in economics fromNorthwestern, and then went to
Wharton and got an MBA infinance, and wound up getting
hired by Eli Lilly and company,in the Financial Group. And I,
after a few years transitioninto sales and marketing,
because it was very clear in thepharmaceutical business, you
(01:56):
can't save your way to success.
So the action was really in, inthe more commercial oriented
activities. I ran parts of thesales force and launched the
number of new products forLilly. And then I transitioned
into the corporate businessdevelopment group. This is the
(02:18):
group that looks outside of thecompany for new technologies
that the company wants to bringin and add to their portfolio.
So it's the the buy side to thesell side of what I'm involved
in now. And I did that for 15years and left as VP of
corporate business development.
And I started consulting and atthat time, this was 2005. Asian
(02:41):
was kind of blooming in theservice business. And so I
started consulting in Asia. Ihad hired out of Wharton for
Lilly a lot of Asians over overmy years at Lilly, and they came
to me and said that they wouldhelp me and introduce me if I
(03:01):
consulted in Asia. So I gave ita shot and worked China, Korea
in India, I wound up after a fewyears, my consultancy was
successful, representing localcompanies in those geographies
and helping them gain entranceto pharmaceutical companies in
the US and Europe. And then Iwound up running the venture in
(03:24):
group for jubilant Life Sciencesout of Bangalore, India, which
is a large Indian contract,services organization and the
pharmaceutical business. And Idid that until 2010 and 2010, I
came back to the US and startedmy first biotech company and
(03:46):
I've been a serial biotechentrepreneur since then. So now
about 1011 years, and prettymuch have worked entirely all
the time, with one physician,Dr. Sunil Sharma, who is at
translational genomics researchinstitute in Phoenix, Arizona as
(04:08):
Deputy Director. So Neil and Ihave started all these
companies. The first one we inlicense from a company that hit
the financial recession poorlyand wound up losing its way, and
we were able to gain access tothe technology. The second
(04:28):
company came out of syneos labin terms of the program and the
third company. We startedtogether and funded together
under sponsored research. And soour labs have been under
sponsored research syneos labsto teach him. So that's what
(04:51):
I've been doing and I found itto be extremely interesting and
a lot of fun.
D.J. Verret, MD, FACS (04:58):
When you say sponsored research, wha
, what exactly are you talkinabout
Unknown (05:04):
So there are two ways to access technology. One way is
to start at the very beginning,which is you have a target that
you want to intervene on in thehuman body. And if it's a small
molecule, you start doingchemistry. And if it's an
antibody, or you know, somenatural aspect of the human
(05:27):
system, like cellular therapy,you'll, you'll start to purify
and pull those cells out in someway. And all those approaches,
if you do it yourself from thestart, you can do it cost
effectively. And you can notwind up having to pay a
(05:47):
university, a lot of money andmilestones and royalties, to
take a program out of theuniversity. But you have to find
that early capital to do theprogram. The other way to do it
is to is to walk the halls ofthe university, and talk to the
biomedical PhD researchers andlook at what they have and pick
(06:11):
something that you like, andthen try and do a deal with
university to license it out atsome economic terms, and then
take that forward in a company.
D.J. Verret, MD, FACS (06:23):
So you've so we'll step through that that
process then. So now, you'veidentified a good idea, either
from university and you've beensuccessful in licensing it, or
you've done some basic research,maybe some of our listeners
actually have labs that they'veidentified a compound they want
to bring forward. What's yournext step atthat point?
Jonathan Northrup (06:45):
Yeah. So I would say the first thing is
that if you've identified atechnology that you like, and
think really has legs, andyou're interesting, interested
in taking it out, and and tryingto see it get developed,
recognize that the biggestchallenges are ahead of you. And
(07:05):
the big money that you need isahead of you. So you want to do
some real diligence on thatprogram. And you want to
validate some of the keyexperiments. And you want to
understand how well done theprogram is. In other words, many
university programs are a littlebit like Swiss cheese, they have
(07:27):
a lot of exciting things thathave been accomplished. And then
they have some big holes thathaven't really been looked at.
And that's that's not becausemaybe the university professor
who is pushing the programforward is in any way dishonest
off, that's always apossibility. But it's more
(07:49):
likely, because it's justoutside of his expertise. There
are a lot of differentdisciplines that are required to
be brought into bear to developpharmaceutical technology. And
so the things that thatuniversity professor just may
not be knowledgeable about. Solet me give you a couple key
(08:10):
examples. So typically, ifyou're working with a university
professor who is primarily abiologist, then you have to be
very thoughtful about whether ornot the chemistry is advanced
enough for that program toreally be a human therapeutic.
It may be that the universityprofessor is using a compound
(08:32):
that has broad based activitiesacross several systems, which
does have activity across thesystem he's interested in, but
those additional activities aregoing to be a problem for you.
So how do you get to a compoundthat's highly specific, highly
selective and highly potent?
D.J. Verret, MD, FACS (08:53):
So basically, you're talking off
target effects? They're right,
Unknown (08:56):
right, right. And so and so you need to make sure you
have as many of those pieces aspossible. And then you also need
to make sure that it can beformulated, you know, if it's a
small molecule that's going intothe human body. My first
company, I did not appreciatewhat a problem that was if the
(09:18):
compound you're trying to get towork and the human body was not
water soluble, you know, we arewater based.
D.J. Verret, MD, FACS (09:27):
Because we are a big water bag.
Basically.
Unknown (09:30):
If you don't have a water soluble compound, that
represents a whole series offormulation challenges, which
can be quite challenging. Wewere we were able to get through
that but only with some prettyexotic technologies and spending
a lot of money and time tofigure that out. So those are
some of the things that you canrun into
D.J. Verret, MD, FACS (09:52):
now, and I think to kind of interject a
different viewpoint on it. Ithink those points are also very
useful. For physician aspotential investors in these
companies to make sure thoseissues have also been addressed
as well.
Unknown (10:08):
Yes, yes. And so you do see many, many people as they
think about investing inbiotechs. They like to follow
other people, so they can rag ontheir diligence. And that's
always a nice situation, if youcan do it. The challenge is to
make sure that you're writing ongood diligence. And for the
(10:31):
right reasons, you know, you canhave VC partners, for example,
that might not want to invest inthat company anymore. But want
to see if they can pull themoney that they've already
invested out by having otherpeople invest in it. So that's
not really the investment youwant to chase. And so you have
(10:53):
to watch everybody's motivationsand things like that. And also,
you know, look at the trackrecord and look at the
involvement and whether or notthe group has the expertise to
get done, what it's done. Whatpeople like the most, of course,
is if somebody has successfullymade a lot of money for
investors with a previousprogram, then that's probably
(11:17):
the easiest program to raisemoney on is their next program.
Because because people like tofollow success.
D.J. Verret, MD, FACS (11:26):
So let's kind of get back to the the
whole approval process, becausewe were talking before we
started the show about whereyour current company is, in
determining where you you founda molecule you have your your
molecule that you want to bringto the clinic, but there's still
a lot of work to be done beforeyou can actually start your
clinical trials.
Unknown (11:46):
Yeah, well, and everybody works out a business
model that works for themarketplace and works for them.
And the business model that mypartner and I have worked out
that I've been the architect ofover these last three companies.
And we're sort of repeating thesame model again, and again, and
we're finding it each time isthat we start very early, with a
(12:12):
target that we believe isunderappreciated. So So we take
an intervention, the human body,which pharma hasn't yet fully
validated, hasn't yet fullyappreciated. And the reason
that's important is becausewe're going to work on less
money, and therefore, it's goingto take us more time to get to
goal. And we can't becompetitive with the 20 to $40
(12:38):
million kind of resources, thata big pharma or a strong VC
backed biotech can throw in aproblem to try and make progress
very quickly. So we need to, weneed to pick targets ahead of
the curve. When people don't yetfully understand the value of
(12:58):
that target, we have to besmarter than other people. And
then what we do is we do as muchof the work as we can early on,
and we throw in a lot of our ownmoney. And in the early days, we
typically work without payingourselves, we just pay ourselves
in equity, we don't takesalaries, so we can be as cast
(13:20):
as efficient as possible to makeas much progress as possible.
And then what you have to doscientifically, is you have to
find your molecule, you have tofind a great molecule that
really very potently hits thetarget. And then also is very
specific, in other words, itdoesn't hit anything else in the
(13:41):
human body, as as much as youcan determine. And you'll still
probably have some toxicities,because usually the body could
service pathways for manythings. So any target that you
pick, is usually going to alsohave some sort of off disease
effects that are justfundamental because of the
(14:05):
biology. And so you have to dealwith those. And then you have to
get a molecule that's a goodmolecule for humans to take. And
so the way we talked about thatis we talked about first having
a head, which means I have amolecule that interacts with a
target. And then I want to makethat hit very potent. And then
(14:30):
once I have that potent hit, Iwant to make it very selective.
And then once I have that I havea lead. And then I want to take
that lead. And I want tooptimize it for the human body,
meaning that I want to get it asclose to a simple once a day
droned you can take orally as Ipossibly can. And if I can get
(14:51):
it all the way there to thatstatus, that I have a great drug
for human beings to take. Soonce you Have that you have what
we call a clinical candidate,which means I have the final
molecule that I think I want totake into the clinic and put
into people. And then now youhave to work for the regulators.
(15:13):
And you have to do all thestudies that will prove to the
FDA that the risk you're takingby entertaining first and man
human trials is reasonable andappropriate for what you're
trying to do. And that's alldisease specific, and up to the
FDA. And we happen to beparticularly, very deep in
(15:37):
oncology. So I can talk tooncology, which is quite
different than other diseases.
So in oncology, then what wehave to do is we have to build
GMP, which means goodmanufacturing practices, both
material. So that means that youhave to be able to prove to the
FDA, that your bulk material isexactly what you say it is,
(15:58):
there's nothing else in it thatyou don't know about like virus
or bacteria, and contaminant andalso that it is stable and will
remain potent over time, so thatyou can store it. And so this
has to be done by specializedmanufacturing group that is in
this business. And then you haveto take that bulk material, and
(16:22):
you have to formulate it into adrug product, in our case,
capsule or tabletthat you expect people to be
taking. And then also those samerequirements apply. For the
final formulation, the tablethas to be you have to know
exactly what's in it has to bepackaged correctly, has to be
(16:42):
stable over time. And all thistakes testing and money and
work. And then at the same time,you have to do toxicology
studies, in usually in twospecies. Now, the species can
vary according to what you'reworking on, we have done. One is
almost always rat, and the otheris going to vary. Usually, if
(17:06):
you have an oral drug, it's it'sgoing to be dog. Because you you
want an animal that will easilytake the medication and the
medication will get into thestomach. If it's an injectable,
we have considered mini pigrather than dog because mini pig
is actually a species closer tohuman being. So in that way,
(17:27):
it's a little more informative.
But the problem with giving anoral medication to a mini pig is
that as you probably know, pigscan eat about anything. And so
they have all these razor sharpteeth in their mouth, which is
pretty hard to navigate, to getthem to take a pill. And if you
try and get them to take a pilla fair amount of the time, it's
(17:49):
going to wind up going down thewrong passageway and wind up in
the lung and then you're goingto have effects in the lung that
represent just not getting thepill to the right destination,
which is not what you want tohave in your TOC study. So you
need a specialized boardcertified toxicologist to do the
(18:12):
TOC study. And the TOC study iscovered under many rules to make
sure that animals are not undulysacrificed or badly treated. And
the purpose of the TOC study andwhy it's so important is because
this is what you're going totake to the early clinicians to
say if a patient is going southbecause of this medication, this
(18:38):
is what you're going to see,this is what you have to watch.
This is the first organ thatlikely will be in danger. And
what you can monitor to see ifthe patient is tolerating the
drug very safely, and that sortof thing. So that's very
important information to givethe first physicians using the
(18:58):
drug. And that requires a veryspecialized toxicologist because
he has to push the drug to thepoint where it exhibits those
effects, but not push the drugso far, that you don't get any
good information on what dosagesmakes sense starting the clinic
that are going to be safe to getpeople beginning after you have
(19:22):
all of that plus your clinicalplan and you have to put
together your clinical protocoland what you want to actually do
To test in phase one and phasetwo in your ind your
investigational new drugapplication. That all gets
packaged up and goes to the FDA,and they have to approve it in a
(19:45):
month. Now.
in that month, they can stop theclock if they see something that
bothers them, and they have alot of questions and they can
reach back and ask you a numberof questions. And when they do
that, they stop the clock forthat. So that might can turn
into 45 or 60 days if you're notvery quick on your responses,
(20:09):
but often it's done in just amonth. And depending on the
agency that you're going to,you'll get different kinds of
reviews. If you have a drug,which is very novel and very
much needed by patients, you'llget some large tests and some
gravitas from the agency,because they'll recognize the
(20:29):
medical need. If you have thenext any diabetic, when they're
probably 40 drugs that peoplecould take, and they're all very
good, and they're all very safe,then safety is going to be a
much stronger concern by theagency. And they're going to
want to see a lot moreinformation there. So it all
depends on what you're trying todo and the group and the agency
(20:52):
that you're working with. Andthen what you'll get from the
agency is you won't get anapproval, but but you will get
permission to proceed. Sothey'll basically say they see
no reason to reject you, andallow you to proceed to the next
level, they won't endorse theprogram. And that allows you
(21:14):
then to go on to hospital IRBfees, and physician IRB s, where
you can go through the IRBprocess. And the IRB There is
also there to make sure that thepatients are safe, that the
protocol is reasonable. And thenit's done in the right way. The
IRB typically will be made up ofa broad array of physicians from
(21:39):
the hospital, often byspecialty, and they'll review
the protocol. And they'll reviewthe preclinical data and the ind
package and make their decision.
And IRB is often take three tosix months to do their decision.
So even though you have anapproved FDA ind, it may be six
months before you can dose yourfirst patient because of the IRB
(22:01):
process. And then as you startin phase one, you can start in
phase one anywhere in the world,we like starting in the US
because the US has, in manycases, an unusual physician who
is involved in phase one trials,and this is a physician
(22:21):
scientist, who really is deepinto the biology of the human
body, and really can kind of puttogether two plus two. In other
words, if they see somethingunusual or perplexing, they can
try and understand what might becausing that. Many times in
Asia, for example, you can findgreat physicians, but they're
(22:45):
fairly disconnected from biologyand biologists. It's unusual to
have medical physician in Asia,who also has a deep not that
there aren't any but it'sunusual, that has a deep
understanding of the biology.
And if a side effect starts tobe seen in phase one, can really
(23:09):
help you figure out what'scausing that. And why is that
side effect coming to the fore?
And what might you be able to doabout it? So we think the US,
Europe is well, in many casesare particularly great places to
do first man studies.
D.J. Verret, MD, FACS (23:26):
Okay, so we've and let me interject here
a little bit and go go backsome? Because I have a couple of
questions along the way. So whatyou've described is sounds like
a fairly long process just toeven start the clinical trials
in humans. How long? In general,have you seen it take from
(23:49):
actually getting a drug compoundto being able to start the drug
trial? And how much money haveyou seen that process end up
taking,
Unknown (23:59):
it usually takes us three to four years to get a
great molecule to give peopleand to identify it. And to get
all those features that we'reafter. And what what I found
over time is if I shortcut thatearly process, I pay for it
later, because then I have adrug that is difficult to
(24:21):
formulate. Or maybe it has to betaken on an empty stomach
instead of a full stomach. Andjust trying to fix those
problems later. In formulationis a lot more expensive, takes a
lot more time than if you canstart with a great molecule that
doesn't need any of that. Sothree to four years is typical.
(24:45):
Some companies can go muchfaster. In many cases. If you
put a lot of people onsomething, you can do things
much faster. But I would sayminimum is two years usually and
then That's to get to themolecule you need. And then the
fastest you can go from thatmolecule to filing an ind is
(25:07):
usually about a year. Andsometimes it's 18 months. So. So
you're at minimum three years,at maximum, maybe five at this
point, when you file your ind,and you're able to start doing
clinical studies. And thenclinical studies take a
different amounts of timebecause the FDA prioritizes
(25:30):
different studies. So if youhave an orphan drug, with four
group of patients that have noapproved therapies, the FDA is
going to give you all their topdesignations, and you might be
able to get to market and startselling your drugs three year,
three years after you dose yourfirst patient. If you don't have
(25:53):
that situation, if you have adrug, which is going to a
population that has a number oftherapies, that isn't going to
get those designations, that isa big population. So maybe
there's a big commercial rewardat the end, then you're going to
have to do the full three phasesof clinical development, phase
(26:15):
one for safety and tolerability,phase two for non disco
efficacy, and phase three forstatistical efficacy that
regulators will accept to putthe drug on the market. And that
typically takes eight years andin Rockers, probably a quarter
(26:37):
of a billion dollars.
D.J. Verret, MD, FACS (26:41):
Now let's talk a little bit about because
because it kind of sounded easyin your explanation. But I know
there's a lot more involved.
Talk to me to talk to ourlisteners a little bit about
selecting the indication thatyou're going to go after, during
your pre clinical time.
Unknown (27:01):
It's a great question, DJ. So it depends a lot on where
you're working and the moleculethat you have. So in our current
program, we're in immuneoncology. And we have a molecule
that can be used quite broadlyacross seas. So we have a lot of
choices. That's not always thecase, you might have a molecule
(27:24):
that's specifically designed fora very specific and narrow
disease, and the decision iseasy. But it but for us in
oncology, the decision is oftendifficult. In our business
model, we always try and do twoclinical trials, we always try
and do a clinical trial, which Iconsider to be primarily for the
(27:47):
FDA, which is an orphanindication with patients that
have dire need, which meets allof the FDA top criteria, so that
we can go for all of the FDA topdesignations and get to market
in three years. Because that'svery valuable. And if it's a
(28:10):
pediatric disease, or tropicaldisease, then you may also get a
pediatric voucher from the FDA,which is an ability to sell
accelerated approval to someother company that has the
therapy and those typically, youdon't get those until you launch
(28:31):
the product. But those typicallycan be worth anywhere from 50 to
$100 million in cash, or you canuse them on the next product in
your own portfolio. The otherdisease that's really important
to go after is because we'refundamentally oriented toward
selling our program to BigPharma, you know, our our
(28:53):
business model, is to takethings through phase two, at
most no further. And the reasonfor that is I can do that with a
team of 15 to 20 people that arevery specialized and very high
performing that don't require alot of oversight efforts. And I
(29:13):
like working in that kind ofgroup that fits my personality
and who I am, I really am notinterested in running a company
that has thousands of peopledoing all kinds of you know,
boots on the ground things thatis too much too much spanned and
(29:33):
too much worry and bother inpolitics for me personally to to
enjoy. So I like to leave allthat big stuff to the
pharmaceutical companies. Theyhave the infrastructure for
that. They're well designed forthat they do that with multiple
programs all the time. And Ilike to work in this earlier
stage which has a greatinflection point. So you can
(29:56):
make a lot of money you can makea lot of money for your
investors. You Much morecontrollable. And I think you
have a reasonable chance ofbeing smarter than other people
by making good decisions. Sothat's the business model we go
after. So in that model, wetypically go into the clinic.
But we only do phase one andphase two. So we're talking
(30:19):
about treating no more thanmaybe 100 patients, and then
selling the drug. And if we cansell earlier than that, that's
great. If you could
D.J. Verret, MD, FACS (30:31):
we were kind of approaching our time
limit here. But I'd like to getinto a kind of a brief
discussion for our listeners onadvice you would have for
physicians who would beinterested in working in the
pharmaceutical realm,particularly with startup drug
companies, either that theymight want to invest or they
might want to consult or theymight want to be the participant
(30:54):
in the clinical trials. Whatkind of advice would you give
them to to bring those ideas tofruition?
Unknown (31:02):
Yeah, so as an investor, there are a number of
great organizations that thatare available to you. I'm
thinking of GPG, whichgreenparks in golf, here in
Dallas, which has a very goodplatform, does diligence,
(31:25):
invests, and that'd be a greatplace to start to look at deals
and think about them. Also,Angel MD is another one. It's
more of a national, sort oforiented approach and has a
platform and also has a lot ofphysicians involved hails out of
Seattle, but has moved intoHouston in Dallas and Denver in
(31:50):
a number of other cities, and isa good place. There are a number
of local Angel groups you couldcheck out. Every city has one or
two Angel groups that look atdeals and some of those look at
healthcare deals. Healthwildcatters in Dallas is a great
incubator for early deals, whereyou can get very closely
(32:13):
involved with companies and manypeople actually become involved
with health wildcatters so thatthey can pick companies that
they want to be involved in. Andthen perhaps have a much
stronger relationship with, insome cases, even being an
officer of the company. So thoseare all ways you can start to
(32:35):
get involved. I think, also,universities, you can talk to
the people in the technologyoffice, and talk to them about
deals that they have at theuniversity or technologies that
are looking for a home, that's alittle bit more shoe leather
(32:56):
work on your part. But you mightfind some very interesting
things. And hear, you can getinvolved very early, maybe even
be involved in taking thattechnology out of the
university. And you might beable to team up with a great
biologist or great biology andchemistry team. So those are all
(33:17):
great ways to get started.
D.J. Verret, MD, FACS (33:20):
That's that's extremely helpful
information. And as you know,I've I've worked with Healthcare
Wildcatters, I agree, I thinkt's a good early stage
echnology greenpark and golfoes really good diligence,
hey've they've come a long wayn their their time now and have
eally become a streamlinedrganization, putting in a lot
f work into the companies thathey're working with. So I think
(33:41):
hose are really good examples.
alk to me a little bit aboutaybe physicians who are who
ren't interested so much in thenvestment side, but would be
nterested in looking at newrugs, participating in clinical
rials, if they have fairlyarge patient base, maybe in
ncology or rheumatology orhatever specialty, what are
(34:02):
ome thoughts you would have forhem in getting involved with
ind of startup drug companieso run clinical trials?
Unknown (34:14):
Yeah, I think if you're looking to do clinical trials,
as a physician, I would actuallysuggest that from from that
chair, I might start the otherway. In other words, I might
start to see how can I be partof phase four trials for large
(34:36):
pharmaceutical companies andlarge biotechs that have
marketed drugs? And once I didphase four trials that I would
look at, do I want to do phasethree trials. In other words, I
would work backwards becausewhen you work back to the phase
one trial, you're talking aboutthe highest risk, most
(34:56):
liability, most intensiveIstiklal equipment required kind
of trying, the the easiesttrials to do are first of all
generic drugs, because you'rejust proving that you're the
same. So you can do those trialspretty much in healthy
volunteers and just take alittle blood, you don't
(35:17):
necessarily even need to haveheavy duty monitoring equipment
in your facility. As long as youhave a vehicle that can get
somebody to the hospital in fiveminutes, you might not even have
have an emergency facility thereon premises. So I'm just
thinking about the the physicalequipment and expense of getting
(35:41):
involved, I might go at it thereverse way, start with phase
four, and move down to phaseone. You know, and I think this
is where maybe small companies,it'd be more difficult to help
them. Now, the difference is I'mtalking about therapeutics here,
but there are many othercompanies in healthcare than
(36:03):
Justin therapeutics. So thereare lots of digital companies
that maybe have a device whereyou can do a much less formal
trial, because the device may beisn't invasive, who are doing
monitoring, and, and other kindsof approaches. So they might
(36:24):
have ancillary things thatthey're doing within the context
of a trial that you could easilybe involved in. So I would look
also on the digital side ofhealth care, because there's a
lot happening there, andexternal medical devices that
don't need to be implanted.
These things can be done muchmore easily with without a lot
(36:46):
of burden on equipment.
D.J. Verret, MD, FACS (36:51):
And I think to kind of find those
opportunities, all of the placesyou mentioned Angel Angel MD, h
althcare wildcatters, looking tthose folks to kind of see w
at the startup company lndscape looks like would be a n
tural starting point as well.
Unknown (37:08):
Yeah, absolutely, absolutely be a great starting
point. That was one of the nicethings about Dallas is you
really do have a prettycompetent, eco structure there
that has developed over time formajor city that hasn't really
had a major pharmaceuticalcompany. Be there.
D.J. Verret, MD, FACS (37:31):
And finally, one more one more
question for you. If I'm aphysician, and I have a basic
science lab are identified oneof those areas where I think a
molecule can be easily createdto address a need. What What
would be your advice on seekingout the business side CEO like
(37:54):
the partnership that you have,with Dr. Sharma, what would be
your advice for a physician tosearch out the business
executive to help them inproduct development?
Unknown (38:06):
Well, a great place to go is to go to whatever
incubators are in the area. AndDallas, for example, I has four
or five. But go to theincubators in the area because
as you get to know these folks,you know, this is a business
where not everyone succeeds. Sosome of these people, they
(38:29):
currently have something thatthey're doing, maybe next year,
they won't, and they could beavailable. So making those
connections, making thoserelationships. And also talking
to the same folks we've beentalking about who run those
incubators or venture groups,they may know of people that
have hit adversity. Maybe thescience didn't perform when the
(38:54):
drug went forward, and someonebecomes available. And so that's
another place to go, I wouldjust offer this caution. You
know, this is a very difficultarea, it's a very difficult area
to make money. And so you reallyneed somebody who's very good.
And so if you have your baby,that you're taking forward, I
(39:18):
would really encourage you tostay involved. And even if you
get someone like this who ishelping you, you need to be in
there sort of shoulder toshoulder talking about
everything being a soundingboard, making sure things make
sense and and talking to otherpeople that you know, who are in
this business or have been inthis business and can give you
(39:40):
healthy advice. Because it'sit's very easy to wind up with
people if they don't have astrong stake in the technology
in the business. If they don'tknow what they're doing. Then,
you know, you can be you know,part of their learning
experience, which is not whatyou want. Have you
D.J. Verret, MD, FACS (40:01):
know you definitely don't want to be part
of someone's learningexperience. Jonathan, thanks so
much for joining us. Iappreciate it. It has been
extremely informative. And Ithink it was a really good
insight into the difficulty ofparticularly drug development
and and how much time and effortit really takes to bring a drug
(40:21):
to market. Well, really
Unknown (40:23):
fun for me DJ and I hope your listeners find it at
some value. Thank you very much.
D.J. Verret, MD, FACS (40:29):
We've been talking with Jonathan
Northrup, CEO and co founder ofStingray therapeutics, a serial
drug development founder andindustry expert, you're
listening to ask me MD medicalschool for the real world. I'm
Dr. DJ Verret. Thank you forjoining us. Make it an awesome
week.
Announcer (40:48):
Thank you for joining us for another episode of Ask me
MD medical school for the realworld with Dr. D.J. Verret. If
you have a question or an ideafor a show, send us an email at
questions at ask me Md pdcast.com.
Ask me MD medical school for the real world with
(00:03):
the MD Dr. DJ Verret
D.J. Verret, MD, FACS (00:06):
Welcome to Ask me MD medical school for
the real world. I'm Dr. DJVerret. Today we have the
pleasure of being joined byJonathan Northrup, CEO and co
founder of Stingraytherapeutics, a serial
entrepreneur in drug developmentand an industry veteran from Eli
Lilly. We're gonna take a shortbreak and talk to Jonathan about
(00:26):
drug development and startupmedicine right after this.
Commercial (00:31):
Instert Commercial ere
D.J. Verret, MD, FACS (00:46):
Welcome back to ask me MD medical school
for the real world. I'm Dr. DJVerret, and today we're talking
with Jonathan Northrop, who iscurrently CEO and co founder of
Stingray therapeutics. At thesame time, Jonathan has board
positions at two other startupmedical companies who he was
involved with. And he's going toprovide us some insight into
(01:09):
drug development and howphysicians can become involved
in drug development. Jonathan,thanks for joining us.
Jonathan Northrup (01:16):
Well, it's great to be here. Thank you, DJ.
D.J. Verret, MD, FACS (01:19):
So if you don't mind, obviously, we've
we've talked in the past and andif you wouldn't mind, though,
kind of give us an idea of yourbackground and how you got to
where you are today. So ourlisteners can know your, your
extensive industry experience.
Jonathan Northrup (01:34):
Yeah, sure.
So I got a BA in economics fromNorthwestern, and then went to
Wharton and got an MBA infinance, and wound up getting
hired by Eli Lilly and company,in the Financial Group. And I,
after a few years transitioninto sales and marketing,
because it was very clear in thepharmaceutical business, you
(01:56):
can't save your way to success.
So the action was really in, inthe more commercial oriented
activities. I ran parts of thesales force and launched the
number of new products forLilly. And then I transitioned
into the corporate businessdevelopment group. This is the
(02:18):
group that looks outside of thecompany for new technologies
that the company wants to bringin and add to their portfolio.
So it's the the buy side to thesell side of what I'm involved
in now. And I did that for 15years and left as VP of
corporate business development.
And I started consulting and atthat time, this was 2005. Asian
(02:41):
was kind of blooming in theservice business. And so I
started consulting in Asia. Ihad hired out of Wharton for
Lilly a lot of Asians over overmy years at Lilly, and they came
to me and said that they wouldhelp me and introduce me if I
(03:01):
consulted in Asia. So I gave ita shot and worked China, Korea
in India, I wound up after a fewyears, my consultancy was
successful, representing localcompanies in those geographies
and helping them gain entranceto pharmaceutical companies in
the US and Europe. And then Iwound up running the venture in
(03:24):
group for jubilant Life Sciencesout of Bangalore, India, which
is a large Indian contract,services organization and the
pharmaceutical business. And Idid that until 2010 and 2010, I
came back to the US and startedmy first biotech company and
(03:46):
I've been a serial biotechentrepreneur since then. So now
about 1011 years, and prettymuch have worked entirely all
the time, with one physician,Dr. Sunil Sharma, who is at
translational genomics researchinstitute in Phoenix, Arizona as
(04:08):
Deputy Director. So Neil and Ihave started all these
companies. The first one we inlicense from a company that hit
the financial recession poorlyand wound up losing its way, and
we were able to gain access tothe technology. The second
(04:28):
company came out of syneos labin terms of the program and the
third company. We startedtogether and funded together
under sponsored research. And soour labs have been under
sponsored research syneos labsto teach him. So that's what
(04:51):
I've been doing and I found itto be extremely interesting and
a lot of fun.
D.J. Verret, MD, FACS (04:58):
When you say sponsored research, wha
, what exactly are you talkinabout
Unknown (05:04):
So there are two ways to access technology. One way is
to start at the very beginning,which is you have a target that
you want to intervene on in thehuman body. And if it's a small
molecule, you start doingchemistry. And if it's an
antibody, or you know, somenatural aspect of the human
(05:27):
system, like cellular therapy,you'll, you'll start to purify
and pull those cells out in someway. And all those approaches,
if you do it yourself from thestart, you can do it cost
effectively. And you can notwind up having to pay a
(05:47):
university, a lot of money andmilestones and royalties, to
take a program out of theuniversity. But you have to find
that early capital to do theprogram. The other way to do it
is to is to walk the halls ofthe university, and talk to the
biomedical PhD researchers andlook at what they have and pick
(06:11):
something that you like, andthen try and do a deal with
university to license it out atsome economic terms, and then
take that forward in a company.
D.J. Verret, MD, FACS (06:23):
So you've so we'll step through that that
process then. So now, you'veidentified a good idea, either
from university and you've beensuccessful in licensing it, or
you've done some basic research,maybe some of our listeners
actually have labs that they'veidentified a compound they want
to bring forward. What's yournext step atthat point?
Jonathan Northrup (06:45):
Yeah. So I would say the first thing is
that if you've identified atechnology that you like, and
think really has legs, andyou're interesting, interested
in taking it out, and and tryingto see it get developed,
recognize that the biggestchallenges are ahead of you. And
(07:05):
the big money that you need isahead of you. So you want to do
some real diligence on thatprogram. And you want to
validate some of the keyexperiments. And you want to
understand how well done theprogram is. In other words, many
university programs are a littlebit like Swiss cheese, they have
(07:27):
a lot of exciting things thathave been accomplished. And then
they have some big holes thathaven't really been looked at.
And that's that's not becausemaybe the university professor
who is pushing the programforward is in any way dishonest
off, that's always apossibility. But it's more
(07:49):
likely, because it's justoutside of his expertise. There
are a lot of differentdisciplines that are required to
be brought into bear to developpharmaceutical technology. And
so the things that thatuniversity professor just may
not be knowledgeable about. Solet me give you a couple key
(08:10):
examples. So typically, ifyou're working with a university
professor who is primarily abiologist, then you have to be
very thoughtful about whether ornot the chemistry is advanced
enough for that program toreally be a human therapeutic.
It may be that the universityprofessor is using a compound
(08:32):
that has broad based activitiesacross several systems, which
does have activity across thesystem he's interested in, but
those additional activities aregoing to be a problem for you.
So how do you get to a compoundthat's highly specific, highly
selective and highly potent?
D.J. Verret, MD, FACS (08:53):
So basically, you're talking off
target effects? They're right,
Unknown (08:56):
right, right. And so and so you need to make sure you
have as many of those pieces aspossible. And then you also need
to make sure that it can beformulated, you know, if it's a
small molecule that's going intothe human body. My first
company, I did not appreciatewhat a problem that was if the
(09:18):
compound you're trying to get towork and the human body was not
water soluble, you know, we arewater based.
D.J. Verret, MD, FACS (09:27):
Because we are a big water bag.
Basically.
Unknown (09:30):
If you don't have a water soluble compound, that
represents a whole series offormulation challenges, which
can be quite challenging. Wewere we were able to get through
that but only with some prettyexotic technologies and spending
a lot of money and time tofigure that out. So those are
some of the things that you canrun into
D.J. Verret, MD, FACS (09:52):
now, and I think to kind of interject a
different viewpoint on it. Ithink those points are also very
useful. For physician aspotential investors in these
companies to make sure thoseissues have also been addressed
as well.
Unknown (10:08):
Yes, yes. And so you do see many, many people as they
think about investing inbiotechs. They like to follow
other people, so they can rag ontheir diligence. And that's
always a nice situation, if youcan do it. The challenge is to
make sure that you're writing ongood diligence. And for the
(10:31):
right reasons, you know, you canhave VC partners, for example,
that might not want to invest inthat company anymore. But want
to see if they can pull themoney that they've already
invested out by having otherpeople invest in it. So that's
not really the investment youwant to chase. And so you have
(10:53):
to watch everybody's motivationsand things like that. And also,
you know, look at the trackrecord and look at the
involvement and whether or notthe group has the expertise to
get done, what it's done. Whatpeople like the most, of course,
is if somebody has successfullymade a lot of money for
investors with a previousprogram, then that's probably
(11:17):
the easiest program to raisemoney on is their next program.
Because because people like tofollow success.
D.J. Verret, MD, FACS (11:26):
So let's kind of get back to the the
whole approval process, becausewe were talking before we
started the show about whereyour current company is, in
determining where you you founda molecule you have your your
molecule that you want to bringto the clinic, but there's still
a lot of work to be done beforeyou can actually start your
clinical trials.
Unknown (11:46):
Yeah, well, and everybody works out a business
model that works for themarketplace and works for them.
And the business model that mypartner and I have worked out
that I've been the architect ofover these last three companies.
And we're sort of repeating thesame model again, and again, and
we're finding it each time isthat we start very early, with a
(12:12):
target that we believe isunderappreciated. So So we take
an intervention, the human body,which pharma hasn't yet fully
validated, hasn't yet fullyappreciated. And the reason
that's important is becausewe're going to work on less
money, and therefore, it's goingto take us more time to get to
goal. And we can't becompetitive with the 20 to $40
(12:38):
million kind of resources, thata big pharma or a strong VC
backed biotech can throw in aproblem to try and make progress
very quickly. So we need to, weneed to pick targets ahead of
the curve. When people don't yetfully understand the value of
(12:58):
that target, we have to besmarter than other people. And
then what we do is we do as muchof the work as we can early on,
and we throw in a lot of our ownmoney. And in the early days, we
typically work without payingourselves, we just pay ourselves
in equity, we don't takesalaries, so we can be as cast
(13:20):
as efficient as possible to makeas much progress as possible.
And then what you have to doscientifically, is you have to
find your molecule, you have tofind a great molecule that
really very potently hits thetarget. And then also is very
specific, in other words, itdoesn't hit anything else in the
(13:41):
human body, as as much as youcan determine. And you'll still
probably have some toxicities,because usually the body could
service pathways for manythings. So any target that you
pick, is usually going to alsohave some sort of off disease
effects that are justfundamental because of the
(14:05):
biology. And so you have to dealwith those. And then you have to
get a molecule that's a goodmolecule for humans to take. And
so the way we talked about thatis we talked about first having
a head, which means I have amolecule that interacts with a
target. And then I want to makethat hit very potent. And then
(14:30):
once I have that potent hit, Iwant to make it very selective.
And then once I have that I havea lead. And then I want to take
that lead. And I want tooptimize it for the human body,
meaning that I want to get it asclose to a simple once a day
droned you can take orally as Ipossibly can. And if I can get
(14:51):
it all the way there to thatstatus, that I have a great drug
for human beings to take. Soonce you Have that you have what
we call a clinical candidate,which means I have the final
molecule that I think I want totake into the clinic and put
into people. And then now youhave to work for the regulators.
(15:13):
And you have to do all thestudies that will prove to the
FDA that the risk you're takingby entertaining first and man
human trials is reasonable andappropriate for what you're
trying to do. And that's alldisease specific, and up to the
FDA. And we happen to beparticularly, very deep in
(15:37):
oncology. So I can talk tooncology, which is quite
different than other diseases.
So in oncology, then what wehave to do is we have to build
GMP, which means goodmanufacturing practices, both
material. So that means that youhave to be able to prove to the
FDA, that your bulk material isexactly what you say it is,
(15:58):
there's nothing else in it thatyou don't know about like virus
or bacteria, and contaminant andalso that it is stable and will
remain potent over time, so thatyou can store it. And so this
has to be done by specializedmanufacturing group that is in
this business. And then you haveto take that bulk material, and
(16:22):
you have to formulate it into adrug product, in our case,
capsule or tabletthat you expect people to be
taking. And then also those samerequirements apply. For the
final formulation, the tablethas to be you have to know
exactly what's in it has to bepackaged correctly, has to be
(16:42):
stable over time. And all thistakes testing and money and
work. And then at the same time,you have to do toxicology
studies, in usually in twospecies. Now, the species can
vary according to what you'reworking on, we have done. One is
almost always rat, and the otheris going to vary. Usually, if
(17:06):
you have an oral drug, it's it'sgoing to be dog. Because you you
want an animal that will easilytake the medication and the
medication will get into thestomach. If it's an injectable,
we have considered mini pigrather than dog because mini pig
is actually a species closer tohuman being. So in that way,
(17:27):
it's a little more informative.
But the problem with giving anoral medication to a mini pig is
that as you probably know, pigscan eat about anything. And so
they have all these razor sharpteeth in their mouth, which is
pretty hard to navigate, to getthem to take a pill. And if you
try and get them to take a pilla fair amount of the time, it's
(17:49):
going to wind up going down thewrong passageway and wind up in
the lung and then you're goingto have effects in the lung that
represent just not getting thepill to the right destination,
which is not what you want tohave in your TOC study. So you
need a specialized boardcertified toxicologist to do the
(18:12):
TOC study. And the TOC study iscovered under many rules to make
sure that animals are not undulysacrificed or badly treated. And
the purpose of the TOC study andwhy it's so important is because
this is what you're going totake to the early clinicians to
say if a patient is going southbecause of this medication, this
(18:38):
is what you're going to see,this is what you have to watch.
This is the first organ thatlikely will be in danger. And
what you can monitor to see ifthe patient is tolerating the
drug very safely, and that sortof thing. So that's very
important information to givethe first physicians using the
(18:58):
drug. And that requires a veryspecialized toxicologist because
he has to push the drug to thepoint where it exhibits those
effects, but not push the drugso far, that you don't get any
good information on what dosagesmakes sense starting the clinic
that are going to be safe to getpeople beginning after you have
(19:22):
all of that plus your clinicalplan and you have to put
together your clinical protocoland what you want to actually do
To test in phase one and phasetwo in your ind your
investigational new drugapplication. That all gets
packaged up and goes to the FDA,and they have to approve it in a
(19:45):
month. Now.
in that month, they can stop theclock if they see something that
bothers them, and they have alot of questions and they can
reach back and ask you a numberof questions. And when they do
that, they stop the clock forthat. So that might can turn
into 45 or 60 days if you're notvery quick on your responses,
(20:09):
but often it's done in just amonth. And depending on the
agency that you're going to,you'll get different kinds of
reviews. If you have a drug,which is very novel and very
much needed by patients, you'llget some large tests and some
gravitas from the agency,because they'll recognize the
(20:29):
medical need. If you have thenext any diabetic, when they're
probably 40 drugs that peoplecould take, and they're all very
good, and they're all very safe,then safety is going to be a
much stronger concern by theagency. And they're going to
want to see a lot moreinformation there. So it all
depends on what you're trying todo and the group and the agency
(20:52):
that you're working with. Andthen what you'll get from the
agency is you won't get anapproval, but but you will get
permission to proceed. Sothey'll basically say they see
no reason to reject you, andallow you to proceed to the next
level, they won't endorse theprogram. And that allows you
(21:14):
then to go on to hospital IRBfees, and physician IRB s, where
you can go through the IRBprocess. And the IRB There is
also there to make sure that thepatients are safe, that the
protocol is reasonable. And thenit's done in the right way. The
IRB typically will be made up ofa broad array of physicians from
(21:39):
the hospital, often byspecialty, and they'll review
the protocol. And they'll reviewthe preclinical data and the ind
package and make their decision.
And IRB is often take three tosix months to do their decision.
So even though you have anapproved FDA ind, it may be six
months before you can dose yourfirst patient because of the IRB
(22:01):
process. And then as you startin phase one, you can start in
phase one anywhere in the world,we like starting in the US
because the US has, in manycases, an unusual physician who
is involved in phase one trials,and this is a physician
(22:21):
scientist, who really is deepinto the biology of the human
body, and really can kind of puttogether two plus two. In other
words, if they see somethingunusual or perplexing, they can
try and understand what might becausing that. Many times in
Asia, for example, you can findgreat physicians, but they're
(22:45):
fairly disconnected from biologyand biologists. It's unusual to
have medical physician in Asia,who also has a deep not that
there aren't any but it'sunusual, that has a deep
understanding of the biology.
And if a side effect starts tobe seen in phase one, can really
(23:09):
help you figure out what'scausing that. And why is that
side effect coming to the fore?
And what might you be able to doabout it? So we think the US,
Europe is well, in many casesare particularly great places to
do first man studies.
D.J. Verret, MD, FACS (23:26):
Okay, so we've and let me interject here
a little bit and go go backsome? Because I have a couple of
questions along the way. So whatyou've described is sounds like
a fairly long process just toeven start the clinical trials
in humans. How long? In general,have you seen it take from
(23:49):
actually getting a drug compoundto being able to start the drug
trial? And how much money haveyou seen that process end up
taking,
Unknown (23:59):
it usually takes us three to four years to get a
great molecule to give peopleand to identify it. And to get
all those features that we'reafter. And what what I found
over time is if I shortcut thatearly process, I pay for it
later, because then I have adrug that is difficult to
(24:21):
formulate. Or maybe it has to betaken on an empty stomach
instead of a full stomach. Andjust trying to fix those
problems later. In formulationis a lot more expensive, takes a
lot more time than if you canstart with a great molecule that
doesn't need any of that. Sothree to four years is typical.
(24:45):
Some companies can go muchfaster. In many cases. If you
put a lot of people onsomething, you can do things
much faster. But I would sayminimum is two years usually and
then That's to get to themolecule you need. And then the
fastest you can go from thatmolecule to filing an ind is
(25:07):
usually about a year. Andsometimes it's 18 months. So. So
you're at minimum three years,at maximum, maybe five at this
point, when you file your ind,and you're able to start doing
clinical studies. And thenclinical studies take a
different amounts of timebecause the FDA prioritizes
(25:30):
different studies. So if youhave an orphan drug, with four
group of patients that have noapproved therapies, the FDA is
going to give you all their topdesignations, and you might be
able to get to market and startselling your drugs three year,
three years after you dose yourfirst patient. If you don't have
(25:53):
that situation, if you have adrug, which is going to a
population that has a number oftherapies, that isn't going to
get those designations, that isa big population. So maybe
there's a big commercial rewardat the end, then you're going to
have to do the full three phasesof clinical development, phase
(26:15):
one for safety and tolerability,phase two for non disco
efficacy, and phase three forstatistical efficacy that
regulators will accept to putthe drug on the market. And that
typically takes eight years andin Rockers, probably a quarter
(26:37):
of a billion dollars.
D.J. Verret, MD, FACS (26:41):
Now let's talk a little bit about because
because it kind of sounded easyin your explanation. But I know
there's a lot more involved.
Talk to me to talk to ourlisteners a little bit about
selecting the indication thatyou're going to go after, during
your pre clinical time.
Unknown (27:01):
It's a great question, DJ. So it depends a lot on where
you're working and the moleculethat you have. So in our current
program, we're in immuneoncology. And we have a molecule
that can be used quite broadlyacross seas. So we have a lot of
choices. That's not always thecase, you might have a molecule
(27:24):
that's specifically designed fora very specific and narrow
disease, and the decision iseasy. But it but for us in
oncology, the decision is oftendifficult. In our business
model, we always try and do twoclinical trials, we always try
and do a clinical trial, which Iconsider to be primarily for the
(27:47):
FDA, which is an orphanindication with patients that
have dire need, which meets allof the FDA top criteria, so that
we can go for all of the FDA topdesignations and get to market
in three years. Because that'svery valuable. And if it's a
(28:10):
pediatric disease, or tropicaldisease, then you may also get a
pediatric voucher from the FDA,which is an ability to sell
accelerated approval to someother company that has the
therapy and those typically, youdon't get those until you launch
(28:31):
the product. But those typicallycan be worth anywhere from 50 to
$100 million in cash, or you canuse them on the next product in
your own portfolio. The otherdisease that's really important
to go after is because we'refundamentally oriented toward
selling our program to BigPharma, you know, our our
(28:53):
business model, is to takethings through phase two, at
most no further. And the reasonfor that is I can do that with a
team of 15 to 20 people that arevery specialized and very high
performing that don't require alot of oversight efforts. And I
(29:13):
like working in that kind ofgroup that fits my personality
and who I am, I really am notinterested in running a company
that has thousands of peopledoing all kinds of you know,
boots on the ground things thatis too much too much spanned and
(29:33):
too much worry and bother inpolitics for me personally to to
enjoy. So I like to leave allthat big stuff to the
pharmaceutical companies. Theyhave the infrastructure for
that. They're well designed forthat they do that with multiple
programs all the time. And Ilike to work in this earlier
stage which has a greatinflection point. So you can
(29:56):
make a lot of money you can makea lot of money for your
investors. You Much morecontrollable. And I think you
have a reasonable chance ofbeing smarter than other people
by making good decisions. Sothat's the business model we go
after. So in that model, wetypically go into the clinic.
But we only do phase one andphase two. So we're talking
(30:19):
about treating no more thanmaybe 100 patients, and then
selling the drug. And if we cansell earlier than that, that's
great. If you could
D.J. Verret, MD, FACS (30:31):
we were kind of approaching our time
limit here. But I'd like to getinto a kind of a brief
discussion for our listeners onadvice you would have for
physicians who would beinterested in working in the
pharmaceutical realm,particularly with startup drug
companies, either that theymight want to invest or they
might want to consult or theymight want to be the participant
(30:54):
in the clinical trials. Whatkind of advice would you give
them to to bring those ideas tofruition?
Unknown (31:02):
Yeah, so as an investor, there are a number of
great organizations that thatare available to you. I'm
thinking of GPG, whichgreenparks in golf, here in
Dallas, which has a very goodplatform, does diligence,
(31:25):
invests, and that'd be a greatplace to start to look at deals
and think about them. Also,Angel MD is another one. It's
more of a national, sort oforiented approach and has a
platform and also has a lot ofphysicians involved hails out of
Seattle, but has moved intoHouston in Dallas and Denver in
(31:50):
a number of other cities, and isa good place. There are a number
of local Angel groups you couldcheck out. Every city has one or
two Angel groups that look atdeals and some of those look at
healthcare deals. Healthwildcatters in Dallas is a great
incubator for early deals, whereyou can get very closely
(32:13):
involved with companies and manypeople actually become involved
with health wildcatters so thatthey can pick companies that
they want to be involved in. Andthen perhaps have a much
stronger relationship with, insome cases, even being an
officer of the company. So thoseare all ways you can start to
(32:35):
get involved. I think, also,universities, you can talk to
the people in the technologyoffice, and talk to them about
deals that they have at theuniversity or technologies that
are looking for a home, that's alittle bit more shoe leather
(32:56):
work on your part. But you mightfind some very interesting
things. And hear, you can getinvolved very early, maybe even
be involved in taking thattechnology out of the
university. And you might beable to team up with a great
biologist or great biology andchemistry team. So those are all
(33:17):
great ways to get started.
D.J. Verret, MD, FACS (33:20):
That's that's extremely helpful
information. And as you know,I've I've worked with Healthcare
Wildcatters, I agree, I thinkt's a good early stage
echnology greenpark and golfoes really good diligence,
hey've they've come a long wayn their their time now and have
eally become a streamlinedrganization, putting in a lot
f work into the companies thathey're working with. So I think
(33:41):
hose are really good examples.
alk to me a little bit aboutaybe physicians who are who
ren't interested so much in thenvestment side, but would be
nterested in looking at newrugs, participating in clinical
rials, if they have fairlyarge patient base, maybe in
ncology or rheumatology orhatever specialty, what are
(34:02):
ome thoughts you would have forhem in getting involved with
ind of startup drug companieso run clinical trials?
Unknown (34:14):
Yeah, I think if you're looking to do clinical trials,
as a physician, I would actuallysuggest that from from that
chair, I might start the otherway. In other words, I might
start to see how can I be partof phase four trials for large
(34:36):
pharmaceutical companies andlarge biotechs that have
marketed drugs? And once I didphase four trials that I would
look at, do I want to do phasethree trials. In other words, I
would work backwards becausewhen you work back to the phase
one trial, you're talking aboutthe highest risk, most
(34:56):
liability, most intensiveIstiklal equipment required kind
of trying, the the easiesttrials to do are first of all
generic drugs, because you'rejust proving that you're the
same. So you can do those trialspretty much in healthy
volunteers and just take alittle blood, you don't
(35:17):
necessarily even need to haveheavy duty monitoring equipment
in your facility. As long as youhave a vehicle that can get
somebody to the hospital in fiveminutes, you might not even have
have an emergency facility thereon premises. So I'm just
thinking about the the physicalequipment and expense of getting
(35:41):
involved, I might go at it thereverse way, start with phase
four, and move down to phaseone. You know, and I think this
is where maybe small companies,it'd be more difficult to help
them. Now, the difference is I'mtalking about therapeutics here,
but there are many othercompanies in healthcare than
(36:03):
Justin therapeutics. So thereare lots of digital companies
that maybe have a device whereyou can do a much less formal
trial, because the device may beisn't invasive, who are doing
monitoring, and, and other kindsof approaches. So they might
(36:24):
have ancillary things thatthey're doing within the context
of a trial that you could easilybe involved in. So I would look
also on the digital side ofhealth care, because there's a
lot happening there, andexternal medical devices that
don't need to be implanted.
These things can be done muchmore easily with without a lot
(36:46):
of burden on equipment.
D.J. Verret, MD, FACS (36:51):
And I think to kind of find those
opportunities, all of the placesyou mentioned Angel Angel MD, h
althcare wildcatters, looking tthose folks to kind of see w
at the startup company lndscape looks like would be a n
tural starting point as well.
Unknown (37:08):
Yeah, absolutely, absolutely be a great starting
point. That was one of the nicethings about Dallas is you
really do have a prettycompetent, eco structure there
that has developed over time formajor city that hasn't really
had a major pharmaceuticalcompany. Be there.
D.J. Verret, MD, FACS (37:31):
And finally, one more one more
question for you. If I'm aphysician, and I have a basic
science lab are identified oneof those areas where I think a
molecule can be easily createdto address a need. What What
would be your advice on seekingout the business side CEO like
(37:54):
the partnership that you have,with Dr. Sharma, what would be
your advice for a physician tosearch out the business
executive to help them inproduct development?
Unknown (38:06):
Well, a great place to go is to go to whatever
incubators are in the area. AndDallas, for example, I has four
or five. But go to theincubators in the area because
as you get to know these folks,you know, this is a business
where not everyone succeeds. Sosome of these people, they
(38:29):
currently have something thatthey're doing, maybe next year,
they won't, and they could beavailable. So making those
connections, making thoserelationships. And also talking
to the same folks we've beentalking about who run those
incubators or venture groups,they may know of people that
have hit adversity. Maybe thescience didn't perform when the
(38:54):
drug went forward, and someonebecomes available. And so that's
another place to go, I wouldjust offer this caution. You
know, this is a very difficultarea, it's a very difficult area
to make money. And so you reallyneed somebody who's very good.
And so if you have your baby,that you're taking forward, I
(39:18):
would really encourage you tostay involved. And even if you
get someone like this who ishelping you, you need to be in
there sort of shoulder toshoulder talking about
everything being a soundingboard, making sure things make
sense and and talking to otherpeople that you know, who are in
this business or have been inthis business and can give you
(39:40):
healthy advice. Because it'sit's very easy to wind up with
people if they don't have astrong stake in the technology
in the business. If they don'tknow what they're doing. Then,
you know, you can be you know,part of their learning
experience, which is not whatyou want. Have you
D.J. Verret, MD, FACS (40:01):
know you definitely don't want to be part
of someone's learningexperience. Jonathan, thanks so
much for joining us. Iappreciate it. It has been
extremely informative. And Ithink it was a really good
insight into the difficulty ofparticularly drug development
and and how much time and effortit really takes to bring a drug
(40:21):
to market. Well, really
Unknown (40:23):
fun for me DJ and I hope your listeners find it at
some value. Thank you very much.
D.J. Verret, MD, FACS (40:29):
We've been talking with Jonathan
Northrup, CEO and co founder ofStingray therapeutics, a serial
drug development founder andindustry expert, you're
listening to ask me MD medicalschool for the real world. I'm
Dr. DJ Verret. Thank you forjoining us. Make it an awesome
week.
Announcer (40:48):
Thank you for joining us for another episode of Ask me
MD medical school for the realworld with Dr. D.J. Verret. If
you have a question or an ideafor a show, send us an email at
questions at ask me Md pdcast.com.
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