Back in 2016, a collaboration with an external company on research into ion channels led to two researchers from the Department of Biomedicine founding their own company. Today that company – Initiator Pharma – which is working to develop an alternative to Viagra, has a market value of approx. DKK 65 million.

2018.08.23 | Mette Louise Ohana

 

Ulf Simonsen from the Department of Biomedicine had no plans to start a company. But an insistent chemist from the biotech company NeuroSearch changed all that. The two knew each other from a previous collaboration involving testing of ion channels. One Friday afternoon after another, Ulf Simonsen received a call from the chemist about another type of drug candidate that he thought should be tested in the laboratory. After a year of this, Ulf Simonsen finally gave in and assigned a postdoc to test the drug candidate. The result was surprising, as it turned out to have a positive effect on erectile dysfunction, which is the technical term for not being able to have an erection.

From research to stock market listing

Despite the promising results, the resources were not available to carry on working with the new drug candidate. At the Department of Biomedicine, Ulf Simonsen was encouraged to contact the Department's new business engagement partner Claus Olesen. With his help, the process of taking over the rights to the drug candidate began. In the meantime, the patent to the drug candidate had been taken over by the biotech company Saniona. To obtain funds for the purchase of the patent, Saniona suggested the researchers should go public on the Swedish Spotlight Stock Market.

"The biggest hurdle was probably that neither Ulf nor I had ever tried doing what’s known as an Initial Public Offering or IPO. But with the help of Saniona and a finance company we looked into it the details and felt that it would be possible. And in 2016 we founded the company Initiator Pharma," says Claus Olesen, senior researcher and business engagement partner at the Department of Biomedicine, who in this way also become part of the company.

The company comprised the aforementioned chemist Dan Peters, Ulf Simonsen and Claus Olesen together with Mikael Thomsen, who has extensive experience of preclinical and clinical drug development.

Have raised SEK 38 million

Initiator Pharma was floated on the stock exchange in 2017 and has raised SEK 20 million thus securing the funding to qualify the drug candidate for clinical trials.

"Finding the right structure was a little troublesome at the start and there was also a great deal of paperwork, as we had to comply with both Swedish and Danish financial regulations. But all-in-all, it has been a positive and educational experience. Also, when it comes to meeting the shareholders who think in a completely different way than you do as a scientist. Some are investors who are looking for capital, others are patients who hope for better treatment," says Ulf Simonsen, who is professor at the Department of Biomedicine.

With the help of an external partner, the approval to begin the clinical trials has now been secured. At the same time, Initiator Pharma has issued additional shares and raised SEK 18 million together with guarantees for an additional SEK 12 million. This paves the way for the commencement of phase 1 trials which will commence in the autumn. At the same time, there is funding to cover phase 2, which is scheduled to be carried out in the first half of 2019.

Great need for new medicine

The product is not a competitor to Viagra, but rather a new medical treatment for patients with diabetes. Men with diabetes suffer erectile dysfunction more often than healthy men. At the same time, Viagra does not work for 30-40 per cent of them. The current alternative is e.g. injections in the penis, where one of the side effects is pain and the formation of scar tissue.

"Many studies show that erectile dysfunction generally impairs quality of life. There are more suicides, increased alcohol abuse and an increased divorce rate among those affected, so even though people joke about Viagra, this is actually very serious and there is a great need for medical help. So we’re trying to develop an alternative that can be taken in tablet form,” says Ulf Simonsen, who has worked in the field for many years and, among other things, been a member of the Committee of the World Health Organization's consultations on erectile dysfunction. 

In 2012, a scientific publication estimated that 150 million men worldwide suffer from erectile dysfunction. Projections show that this number will exceed 300 million in 2025. The increase is partially attributable to the increased incidence of diabetes.

Strong support from the department

For the two company founders, meeting the patients has really made a difference.

“Feeling that you can make a difference for some people is a great source of satisfaction. That’s also greater than the fact that we might be able to earn money from this one day," says Claus Olesen

Ulf Simonsen and Claus Olesen highlight their cooperation – both with each other and the other founders of the company – as one of the benefits of the project. Cooperation with AU has similarly worked well.

"This would never have succeeded without the tremendous support we have received from our department head Thomas G. Jensen. In fact, he was the one who brought us together and he has helped to find solutions for us in relation to cooperation with AU," says Claus Olesen.

AU does not have any share in the rights. Rather, the model is that the researchers have an income-generating company agreement, where researchers e.g. lease equipment from AU at market price. However, part of the work is now carried out at external companies.

No impediment for an academic career

Clinical trials will begin shortly. If the substance gets through phase 2 next year, the plan is to find a partner or sell the company.

"For me as a pharmacologist, the further you get into the development, the less interesting things are in purely scientific terms. Of course it’s fantastic to have the opportunity to develop something that can be used by patients. But the earlier phases are the most exciting, because that’s where I learn something new about how what we do in the laboratory works in humans,” says Ulf Simonsen.

The two researchers encourage others who have a good idea to pursue it.

"You have a lot of instructive and fun experiences. It’s in no way an impediment for your academic career. It’s more a case of separating things mentally. In many other countries, getting knowledge transformed into products for patients is much more widespread," says Claus Olesen.

More about the financial aspect

• It is still unclear where and at what price the product could be sold.
• Any future profits will accrue to the company's 3,800 shareholders. The founders own 15 percent of the stocks.
• The product is still under development, so it is too early to predict whether it will be profitable.

Contact

Senior Researcher Claus Olesen
Founder of Initiator Pharma
Aarhus University, Department of Biomedicine
Mobile: (+45) 6126 0035
Email: ceo@biomed.au.dk

Professor Ulf Simonsen
Founder of Initiator Pharma
Aarhus University, Department of Biomedicine
Mobile: (+45) 6020 2613
Email: us@biomed.au.dk