Pierre Fabre To Feed R&D Pipeline Through New Innovation Fund
This article was originally published in Scrip
France's Pierre Fabre has set up an innovation fund to invest in collaborations with start-ups and biotech that is very much tailored to the "needs of a mid-sized European pharmaceutical company", the company announced Feb. 3.
The Pierre Fabre Fund for Innovation, whose size was undisclosed, is a strategic initiative to build relationships and to use the company's research laboratories and know-how in collaborations with biotechs and public and private research laboratories, in order to bring disruptive medicines to patients, said Laurent Audoly, head of research and development at Pierre Fabre Pharmaceuticals. "We will share value and risk with external collaborators and will exit collaborations when they no longer make sense," Audoly added in an interview with Scrip.
"Our objective is to get a drug on the market in the next five years using this mechanism, and we are going to be transparent and have skin in the game," Audoly continued. "A collaboration might mean getting proof of concept or early clinical data that could trigger an option deal or licensing agreement, and we might take a minority equity if that makes sense, but we are not looking to sit on company boards," he added.
Pierre Fabre Pharmaceuticals is undergoing a re-engineering of its R&D effort that has included the closing of research facilities and job losses, and the fund will be used to build up its pipeline in three core areas of oncology, dermatology and onco-dermatology, where it has marketed products or research expertise. Currently, Pierre Fabre's pharma pipeline is thinly populated, although it does have some early clinical-stage CNS products and consumer products in development, and recently added to its oncology portfolio, by licensing Array BioPharma's investigational MEK inhibitor binimetinib and its BRAF inhibitor encorafenib for marketing in Europe and merging markets. The products are nearing completion of Phase III studies.
Audoly is agnostic about how the fund would interact with venture capital. "We are looking to create momentum, and we do not mind collaborating with corporate VC, standard VCs, or syndicates of investors," he said. "I am convinced there are a lot of under-capitalized European biotechs, and we are going to uncover a lot of great projects in Europe. At the same time, we will not exclude any other geographical corridors."
But he also pointed out that what differentiates the fund from VCs is the company's laboratory resources and its clinicians and researchers. And although "we are not going to necessarily compete with big pharma in terms of numbers, we are going to market significant firepower in terms of being able to mix cash and human resources and offer an attractive value proposition to our external collaborators."
Audoly also believed the dynamics of investing and collaborating with European biotechs was to some extent different to collaborating with US biotechs. "We are only an hour away by plane from most of the innovation hubs in Europe, and can work a lot closer with our partners," he noted.
Pierre Fabre is due to start roadshows in Europe shortly to explain its ideas, and has set up a steering committee consisting of Bertrand Parmentier, general manager of Pierre Fabre laboratories, Frédéric Duchesnes, general manager of Pierre Fabre Pharmaceutical's division, and Frédéric Desdouits, executive vice-president of licensing and acquisitions. Audoly will manage the project.
Pierre Fabre had sales of €2.2bn in 2014 from two divisions, €918m from its pharmaceuticals division and €1.14bn from its dermo-cosmetics division, and has particular expertise in plant-based active ingredients; it claims to have the largest private collection of plants in the world. It also conducts contract manufacturing for other companies. It is majority owned by the independent Pierre Fabre Foundation, a French public interest organization, and 7.8% of shares are owned by employees.