NIH CAP – FeedForwardTM Sessions Irvine, CA | March 6-7, 2017

Past Tides
March 23, 2017 By Applied Innovation

On February 6 and 7, the National Institutes of Health (NIH) Commercialization Accelerator Program (CAP) 2016-17 Feed Forward sessions took place for the first time at the Cove.

Eighteen startups that received NIH Phase I Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) grants presented their business strategies. Company technologies ranged from fall risk prediction  software (, circulating tumor cell capture ( to radiopharmaceuticals ( Entrepreneurs received feedback on strategy, pricing, and partnering from a team of advisors matched to them by the LARTA Institute,, an LA-based non-profit that encourages innovation commercialization. LARTA manages the CAP-FeedForward program for the NIH. “It’s a customized program of coaching using a group of mentors and advisors to provide company feedback,” said Rohit Shukla, LARTA CEO. “If they like you and work with you they become your virtual team.”

NIH program officers gave companies tips how to progress to Phase II SBIR grants or Small Business Technology Transfer (STTR) grants. This early evaluation and coaching process raises companies’ chances of success in obtaining grants and focuses them for the long haul, as commercialization in the biomedical field can take years. SBIR grants are particularly advantageous for entrepreneurs as they are non-dilutive, and can be sizable enough to help a company through early proof of concept and clinical trials. SBIR Phase II awards can reach $1,000,000 in total costs for 2 years.

Here are glimpses into the different challenges that face three early stage companies, NIH SBIR grantees with promising technologies that can make dramatic impact on human health:


Sixal, Inc.: Developing a universal anti-allergan?

Key Challenge: Gearing up for a long commercialization path

Santa Monica, Calif.-based Sixal, Inc., is developing a monoclonal antibody-based compound with the ambitious goal of preventing all human allergic (IgE-mediated) responses to severe food allergies and allergic asthma. Sixal states that its compound, which can be injected monthly vs. weekly for other antibodies, could help symptoms and potentially resolve the underlying condition in patients who do not respond well to first-line therapies. So far, Sixal has completed proof-of-concept studies and is now moving toward commercialization with pre-IND studies. The company was awarded $1,489,545.00 in Phase II SBIR grant.

Scientific Founder Andrew Saxon, MD, and Tim Tiemann, CEO, discussed communicating with parents and doctors, given that the group that has the highest fatality rates from allergies are 16 to 30 year olds.

Advisors suggested that Sixal tailor its presentation, highlighting the extensive experience of the scientific founder and team.

Long term dosage could be an issue, as biologics have side effects in long term use, According Tiemann, a challenge is lack of a long term animal model, since IGE is not expressed in non-human primates; Sixal would have to go straight to human clinical trials.

The company advisors asked: Can you show that your IP can survive a commercialization path that can take years? What is the company’s total market size, and what kind of alternative treatments are they really dislocating? How much of the Epipen market could they replace? (Sixal estimates up to 5%) What are their exit and regulatory pathways? What if the company’s estimate of money needed for pre-IND studies and Phase I safety testing is not be enough? “Don’t underestimate the time that takes to do chemistry and make sure that you are developing the right antibody as you are scaling up, cautioned one advisor. What still needs to happen to de-risk your innovation? What are your costs and dosage needed compared to competitors?

ID Genomics, Inc.: Quickly matching the right antibiotics to antibiotic resistant infections.

Key challenge: Establishing value pricing for different customer bases

To combat antibiotic-resistant infections, Seattle, Washington based ID Genomics, Inc. is developing diagnostic tools that guide antibiotic prescriptions in the clinic in less than thirty minutes. This 8 person company has in a few years, created an impressive database of isolates of antibiotic resistant bacteria from around the world. ID Genomics received a $3 million, 3-year Phase II SBIR grant.

Their pilot diagnostic has been developed for urinary tract infections and was successfully evaluated in observational clinical trials in the urgent care setting at the Group Health cooperative, Seattle’s largest HMO. They have eight clinical partners in the U.S., with interest from others in Asia, Europe, and Africa. The company also conducts genotyping services for clients.

ID Genomics’ diagnostics platform consists of two complementary components, CLoNeT and BactNet, which combine culture-independent molecular diagnostics with epidemiological surveillance.

•             CLoNeT, IDG’s diagnostic tool, identifies proprietary genomic barcodes to identify these families using only a few genetic targets, based on the discovery that millions of disease-causing bacterial strains can be simplified into a handful of genetically homogeneous crime families, each with its own distinct response to antibiotics.

•             BactNet, ID Genomics’ reference biorepository developed through partnerships with the military, links these barcodes to responses to commonly used antibiotics and other clinical metadata. BactNet enables real-time epidemiological surveillance, allowing clinicians to pinpoint resistance outbreaks and improving antibiotic stewardship in the community.

Advisors discussed potential competition, partnerships, and alternative sources of income streams and ways to extract value from their database of bacterial isolates. Stephane Budel, partner at DeciBio, a Los Angeles market research consultancy commented that you don’t have to always have profitability at the forefront—competitively it is not necessarily a winner take all situation but you should build best-in breed database and technologies.

According to Kaveri Parker, IDGenomics president and CEO, the next step is to determine pricing. For ID Genomics to develop their value proposition, the company needs to better quantify both the hard costs and the impact of surveillance for customers. IDGenomics has done extensive work on building partnerships with various medical institutions, but needs to find a commercialization model that would protect the IP of its database.

Michael Robards, director of sales and marketing at Accel Biotech in San Diego, said that you need to know the cost and impact of hospital infection data. Environmental sensing is not well regulated. ID Genomics could help hospitals pinpoint hotspots of antibiotic resistance so they can send in the UV emitting robots to clean up.

The company had worked out the pricing of its kit, but was still trying to work out the health economics case for access to its database of bacterial isolates. What to charge for user fee for licenses?

Look at payers or insurance companies, and find out the value for reducing risk of infection in the systems they insure, suggested Ryan Palhidal, business development manager at Biocom

Should the company price by the test or just report the results asked for from the multiplex test? Each approach has its own complications, as a single test can pick up other effects.

An advisor mentioned that the GATES Foundation has an open access requirement for database information. Another advisor commented that the Wellcome Trust is interested in antibiotic resistance. Matt Portnoy director, Division of Special Programs at the NIH said that SBIR grants offer data protection for 4 years.

NeuroSigma: healing brain aneurysms faster

Key Challenge: Proving safety and efficacy in humans

NeuroSigma, based in Los Angeles, has developed flow diverting stent for treating intracranial aneurysms, where blood vessels can weaken, balloon out, and rupture. According to Colin Kealey, M.D, NeuroSigma’s Vice President and Advanced Development, the company’s thin film nitinol mesh stent is like “a microscopic chain link fence” that improves blood flow diversion, and produces faster clotting. A flow diverter works by causing a stagnation of blood flow in the aneurysm sac, producing a blood clot so the aneurysm can heal.

According to Kealey, ~3% of the population has an intracranial aneurysm. The average cost for current stents is $15,000. The market size for aneurysm technologies valued over a $2.0 billion. There is currently about a $300 million market for flow diverters.

Competing braided stents on the market are similar. And like those braided finger traps you get at the state fair, they can have issues with foreshortening. But aneurysms usually don’t go away immediately when a stent is inserted. People can still get sick and die in the up to 6 months it takes for an aneurysm to heal. Kealey said that NeuroSigma’s technology offers a competitive advantage, as other companies have reached the physical limits of where braiding technologies can go.

In early testing, fibrin in blood forms a mesh that facilitates wound healing. This may be due to the tiny pattern of pores in the nitinol surface. When the pore size of the nitinol mesh was reduced, the blood vessels’ ability to grow tissue dramatically increased. In preclinical results in rabbits, Neurosigma’s flow diverter led to clotting in as little as 10 minutes, compared to up to 6 months for braided wire flow diverters.

A preclinical study showed a 91% rate of complete aneurysm occlusion in rabbits by the thin film diverter compared to 39% using a rival company’s medical device. According to Kealey, the reimbursement margins for neurovascular stents are higher than that of cardiac stents.

According to Kealey, this could be a platform technology. NeuroSigma already has multiple patents, as it acquired a small company that made thin film nitinol and in-licensed additional UCLA technologies. The company is currently seeking investment for human testing outside US, to proceed in 2017. Kealey projects trying to raise $5-10 million dollars in their Series A round.

If NeuroSigma can develop this device with superior IP protection, the company could either license the flow diverter, or get acquired. But they first must show that it is safe in human beings.

The company plans an initial small European human study in humans. Once they can obtain a CE mark, they can sell in European Union. They plan to target patients with wide neck aneurysms in the anterior cerebral circulation, according to Kealey, because that is the vascular bed where braided wire devices are shown to be safer. They will need to show non-inferiority in testing.

The advisors cautioned Kealey that he may be underestimating the real costs to get a CE mark. Had NeuroSigma explored other projects to validate the technology? Could thin film nitinol provide a better platform for a drug-eluting coating? The advisors suggested that the company should check if any other company had interests in their patents as well as rearrange its investor presentations to better distinguish technical features from benefits.

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