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Six Takeaways from Boston’s Life Science Disruptors

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a second chance: “This had the same feel to me–a fundamental area of biology, a fundamental opportunity, particularly in the field of cancer.” He became the company’s CEO in 2010.

4. At the fork, Epizyme veered away from a sale. Epizyme faced a critical decision early in its history. Would the company try to build itself into a large, independent drugmaker with a platform for discovering therapeutics? Or set itself up for a sale? Gould said that Epizyme invested heavily in two programs from the start—the same two programs, incidentally, that are its leading drug candidates today—figuring that one of the two was going to fail. According to Gould, the question for Epizyme was, should it maximize those two assets alone and look for a buyer, “breaking every rule that you don’t build your company to sell your company,” or take the time to discover other drug candidates?

“We had many long board discussions on which of these two paths to take,” Gould said. Goldfischer, for instance, said he tends to be more aggressively on the “selling/suitor” side in such discussions. But Epizyme chose to stay independent, and struck a big partnership with Summit, NJ-based Celgene (NASDAQ: CELG) that propelled it towards an IPO in 2013.

“It was a unique situation,” Goldfischer said. “The breadth of the science, and the ability of the management team and the company to generate novel products and ideas really is what drove [it]—and the response they were getting from the people they were talking to, the strategics.”

5. “He said, this doesn’t really look like a compelling opportunity.” As with Hughes and Zafgen, Jonas had no interest in Sage when he first got a phone call from Third Rock’s Kevin Starr to talk about it. Sage was built off the concept of using drugs to either positively or negatively tweak specific receptors (GABA or NMDA) on brain cells, hopefully as a way of treating a variety of neurological disorders—among them, initially, traumatic brain injury and pain. Jonas, then at Shire, had spent years in CNS drug development, and wasn’t impressed: “Old idea, undruggable target, and I want to use a Yiddish word—farkakt [lousy] indication,” he said. Plus, Sage didn’t have any “chemical assets” at the time.

Sage’s VC backers heeded Jonas’s advice and ditched the bigger indications. With a little bit of luck, shortly thereafter, a UC Davis doctor used Sage’s first compound on a 21-year-old with a rare form of epilepsy (status epilepticus) as a last resort under compassionate use. The patient was in a propofol (Diprivan) induced coma, and had been given a number of potential remedies. Four days after getting Sage’s drug, the patient woke up. That result didn’t just convince Sage’s backers that it might have an effective drug, it enticed Jonas to come aboard. He was named the company’s CEO in August 2013.

6. How can a startup succeed in CNS? With quick, small clinical trials. One of the big problems with developing effective drugs for neurological disorders is that animal models “aren’t predictive” for how a drug prospect will work in humans, Jonas said. Costs are high, trials are long, and in a lot of cases, it’s hard to judge if a drug is really working or not. “It’s been a perennial green field with lots of boulders and a gigantic graveyard,” he said.

Sage’s solution: target acute indications that could get it quick yes or no answers supported by electrophysiological biomarkers that actually corresponded to a clinical outcome. That way, Sage could do a study on a patient in a matter of days, rather than months, and get a quick answer as to whether or not it’s on the right track. In essence, plan for failure, and make sure the company is ready to survive it. Starr noted that when Sage brought in Arch Venture Partners in a Series B round a year ago, the company calculated the amount of cash it would need to get to a value inflection point even with a few clinical failures.

“We’re in a long odds business and you have to believe you can break those odds to be successful,” Starr said. “If you don’t embrace that ability to change and rejuggle…you’re going to end up in some trouble.”

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