SINGAPORE - Success stories in the Singapore life sciences sphere are few and far between, but InvitroCue, which targets profitability in seven years, could light the way for other homegrown biotechnology firms seeking to get on the global stage.
The biotech firm, a spin-off from the Agency for Science, Technology and Research (A*Star), helps drug-makers determine which vaccines, products or devices are safe to use in humans - even before tests are conducted to determine if they work.
The firm, founded by biotech entrepreneur Steven Fang and National University of Singapore physiology professor Hanry Yu, debuted on the Australian Securities Exchange (ASX) on Wednesday, just four years after its birth.
Dr Fang told The Business Times on Wednesday that the company had licensed the technologies, which A*Star took six to seven years to develop, and then commercialised them. The team had started to work with global pharmas even during the incubation period, which was why InvitroCue was able to sign contracts with big pharmas such as Novartis when it became a private entity, he said. The company is now in talks with three to four other global pharmas.
The firm raised about A$3.15 million (S$3.51 million) by way of a reverse takeover (RTO) of ASX-listed Bunuru Corporation Limited. Following the RTO, InvitroCue had a 51.3 per cent stake in the enlarged share capital. At its debut on the ASX on Wednesday, the stock opened and closed at A$0.105, five per cent higher than the initial offer of A$0.10.
Asked about his choice of listing, Dr Fang said he believes the ASX can raise funds quickly and has a retail investor base that understands such stocks and can hold them. Having said that, the firm may look at other exchanges when it is mature enough, he said, adding that biotech companies here a global view.
The biggest challenge for Singapore - and biotech companies in particular - is the ability to raise funds mid-stage, that is, series B and C funding; for Dr Fang, it is the "valley of death for many biotech companies".
"Seed funding to series A funding is not a problem. This is a fantastic place to be in for that... But companies need to grow and this means they need series B, C, D funding, which require a lot more hard work and for that very reason, they need to think global in terms of being able to access these types of funding."
Dr Fang, the founder of Singapore-listed Cordlife Pte Ltd, said the funds will go into expanding the company's presence in China and growing its business out of Singapore; he hopes to grow the Suzhou and the Singapore offices in the next year.
InvitroCue's sales growth has doubled in the last two years - a trend which Dr Fang says is sustainable, even in the volatile global markets.
"The drugs that are in the pipeline typically have a gestation period of 10 years. Most companies that invest in them don't just give up because of market volatility and conditions. They would have already set the budget and are tracking these drugs from the milestones that they hit. In fact, some of the valuations of these big companies are very dependent on the success of these drugs that are in the pipeline, so we form a very crucial part of that eco-system to help them develop their drugs more accurately, cheaper and faster."
For now, the company is focused on helping drug-makers to mitigate the risk of developing drugs and to carry out clinical diagnosis more efficiently, using digital pathology.
Digital pathology is an imaging technology based on research led by Prof Yu. It enables more accurate, faster faster diagnoses through pattern recognition and artificial intelligence. Frost and Sullivan says the global digital pathology market will hit US$5.7 billion by 2020, with a compound annual growth rate of 14.3 per cent.
With the cost of developing and marketing a new drug at US$2.6 billion, InvitroCue's technology that fully mimicks "a human liver in the lab", enables a better test for safety issues.
This means that pharmas can use the technology to test different drug candidates or medical devices and get a longer-term view of whether those drugs create problems, he said.
"So we come in just before that human clinical-trial stage, where we try to save them hundreds of millions of dollars from making a wrong decision with the drug. The money we save them there is worth much more than the shortening of the time to get the drug to market."
Global spending on in-vitro drug or cell-based assaying is projected to exceed US$4 billion by 2018; the pharma industry is estimated to account for about US$1 billion of this.
This article was first published on Jan 28, 2016.
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