Former Chairman and CEO of Celgene Believes His New Firm Can Become "A Substantial Player" in Biotech Print E-mail
By M.E.Garza   
Wednesday, 01 August 2012 02:06
icon_qaexclusiveNo doubt, one of the biggest biotech surprises out of the starting gate this year has been Medgenics Inc. (AMEX:MDGN). The stock ran big shortly after their introduction to the market as shares traded from $2.08 to $16.43 in short order-- an impressive run fueled in part by the company's extremely low float and excited reaction by investors.
At this point the stock has begun to fetch the attention of institutions and funds who are seeking measurable execution and clinical data from the emerging firm. They too seem to have little doubt that Medgenics' Biopump technology-- a combination biological and device product has captured the imagination of the biotech community-- has the potential to quickly become a widly successful and very profitable venture. Continued execution, strong clinical data and discussions about partnerships with big pharma players are all in play at different levels right now at Medgenics.

Medgenics' development of their proprietary platform technologies allows patients to produce, within their bodies and on a long-term basis, their own natural human protein therapy for the treatment of a range of chronic diseases each with billion dollar applications, such as anemia and hepatitis C, also attracted top notch seed investors who felt this firm could easily become a powerhouse biotechnology company whose solutions can be applied across large and rapidly growing global protein therapeutic areas that include: anemia, hepatitis C, growth failure or muscular atrophy, multiple sclerosis, hemophilia, wound healing, obesity, cancer recovery and on and on.

Medgenics' product pipeline includes: Epodure, produces and delivers erythropoietin (EPO) in anemic patients indicated for the treatment of anemia; and Infradure, a long acting protein therapy designed to produce a sustained therapeutic dose of interferon-alpha (IFN- alpha) indicated for the treatment of hepatitis C.

In the near term, the firm is expecting to move their pipeline forward in various ways. In mid-April, Medgenics announced that it had filed an Investigational New Drug application with the U.S. Food and Drug Administration to initiate a Phase IIb multi-center, 100-patient clinical trial. The trial is designed to evaluate the safety and efficacy of sustained erythropoietin therapy delivered via the Company's Epodure Biopump for the treatment of anemia in dialysis patients with end-stage renal disease.

Managment has confirmed that their Infradure platform for sustained production and delivery of interferon-alpha for use in the treatment of hepatitis is awaiting final approval for two Phase I/II trials in hepatitis C in Israel, slated to commence Q3 2012. That event has become a significant upcoming catalyst for the stock given the enormous attention hepatitis C developers are getting from biotech investors and Big Pharma in the healthcare sector these days. Sources indicate that the firm is on schedule and that we should be hearing news as it develops with the healp of regulators, most likely sometime between mid and late August.

More recently, Wall Street took notice when
Medgenics announced the addition of Dr. Sol Barer, former Chairman and CEO of Celgene Corporation (NASDAQ:CELG),as Chairman of the Board at MDGN. Some called Barer's addition "A fantastic coup, given Dr. Barer`s long history of industry successes and accolades, particularly the transformation of Celgene from a chiral compound research shop into a multi-billion dollar international pharmaceutical force." Analysts pointed also to the fact that Dr. Barer as Chairman and Isaac Blech, considered one of the most successful financiers in biotechnology and founder of Celgene, have now a major stake in Medgenics and together both have had very favorable results in previous biotech ventures.

"This team has a history of infusing fledgling life science companies with both monetary and intellectual capital. Medgenics is at a stage of growth where Dr. Barer`s scientific and business acumen, regulatory knowledge, and industry influence can only increase investor value. In addition, upcoming short term catalysts in the stock may also set the stage for additional developments and share price appreciation for investors," wrote one analyst who closely followed Barer's career throughout his days as CEO of Celgene.

Given a rare opportunity, we spoke to Dr. Barer about his recent addition and duties at Medgenics.

Question: First of all, do you see any similarities between Medgenics and the early days of Celgene?

Sol J. Barer, PhD: Celgene’s pharmaceutical genesis was the discovery of a new therapeutic platform to potentially treat a wide variety of serious, debilitating, fatal diseases. Similarly Medgenics is based on a platform technology potentially applicable to a broad range of diseases. In both cases a lot remained to be done but the foundation of a novel technology platform applicable broadly encompassed both companies. Our challenge at Medgenics is to strategically apply this platform to achieve the benefits to patients and thereby bring the company to a new level.
Question: So far, Medgenics is working on Anemia, Hemophilia, and Hepatitis.  How broad an array of indications do you think the Medgenics technology can address? Is this "the tip of the iceberg?"

Sol J. Barer, PhD: The potential range of therapeutic proteins is very significant. One of our strategic goals is to pick the right targets to achieve clinical results expeditiously and thereby bring the first therapies to patients as quickly as possible. By doing this we can establish Medgenics’ technology as the state of the art in the delivery of medically important proteins.
Question: What made you want to join the team at Medgenics?

Sol J. Barer, PhD: I was intrigued by the science, the reduction to practice, the breadth of potential applications and the enthusiasm and passion of the team. I very much appreciate and value of the platform and the numerous applications possible for the benefit of patients.
Question: You and Isaac Blech were both involved in the creation of Celgene. How does it feel to be working together again after 25 years?

Sol J. Barer, PhD: Isaac is a legendary name in Biotechnology starting with his involvement with Genetic Systems and many other companies. I very much enjoy working with him and the entire Board.
Question: Do you think Medgenics represents a new paradigm in protein therapy and why?

Sol J. Barer, PhD: The application of Medgenics technology has the potential to impact both patients’ health and well being as well as the economics of therapies. These are primary issues in healthcare today.
Question: Why do you think Israel is emerging as a new center for biotechnology innovation?

Sol J. Barer, PhD: Israel has been an established innovator in the medical area with a substantial number of medical devices having their origin there. Israel is a unique place with a unique culture that is very suited to innovation and implementation. Much of this has been the subject of study as exemplified in the book “Start up Nation” which details many of the factors including the role of the military and the culture.  Success breeds success and I think we will see a continued flowering of medical technology companies and biotechnology companies in the country.
Question: What was it that attracted you to Medgenics' technology?

 Sol J. Barer, PhD: The breadth, elegance and the potential impact on patients’ health and favorable pharmacoeconomics impact.

Question: Do you feel the Medgenics technology has potential applications beyond the 130 billion dollar annual protein therapy market, and if so, what are they?

Sol J. Barer, PhD: I can’t answer this now. There are moving parts in play that won't allow me to answer this question right now.
Question: Given that the technology is so adaptive, to so many indications, analysts feel there is more potential for growth here than we see with most other biotech firms. Are they are painting an accurate picture form your perspective?

Sol J. Barer, PhD: I think it’s clear that if Medgenics fulfills its potential it can become a substantial entity—all of this will be based on the applicability of the technology to many diseases and its impact on patients well-being.
Question: What are the biggest challenges for the firm?

Sol J. Barer, PhD: Medgenics is still at an early stage in its development as a company. It is an exciting time as evidenced by the advancement of the science and entering the clinical and regulatory phase. The growth of any company engenders challenges with respect to growing its human resources, dealing with the increasing complexity of the organization, assuring for the strategic direction of its focus and a myriad of other things. These are good problems to have as it indicates the company is growing rapidly. I'm really looking forward to helping this growth.

Disclosure: Long MDGN

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