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Large, well-funded pharmaceuticals and biotechs get most of the headlines when it comes to cancer research. But smaller companies that toil in the shadows are also making some big advances. Their budgets may not rival those of the heavyweights, but agility and focus enable startups and other growing companies to make significant contributions to the fight against cancer.

“With more than 100 types – including rare ones – cancer can be complex and challenging to treat,” said Debbie Hart, founding president and CEO of BioNJ, which advocates for the life sciences industry. “From large pharma to small biotech companies, New Jersey is the No. 2 state for oncology drug development – with an estimated 4,500 current oncology clinical trials and eight of the 15 novel FDA oncology drug approvals in 2021 coming from companies with a footprint in New Jersey.”

In addition to the “significant presence of large biopharmaceutical companies working on oncology programs in the state – such as Bristol Myers Squibb, Novartis, J&J, Merck and GSK, just to name a few — New Jersey is also home to numerous emerging companies with groundbreaking cancer drugs in clinical development, such as Celldex Therapeutics, Rafael Pharma, ADC Therapeutics, Soligenix and Cyclacel Pharmaceuticals,” she added. “In fact, New Jersey’s life sciences cluster has grown from approximately 30 companies in the early 1990s to approximately 3,200 establishments in the state today, with 43 of those firms responsible for a staggering 70 new FDA drug approvals across all disease states in 2020 and 2021.”

Many medical breakthroughs are achieved through partnerships between large and emerging innovator companies as well as academic and other research institutions, Hart explained. “BioNJ takes pride in connecting and encouraging collaboration between, amongst and across small and large biopharmaceutical companies, research institutions and academia. We also work to give our companies a stable policy environment in which to work and grow, as well as educational and other programs to support their work.”

Unmet needs

Soligenix Inc. is one of these small biopharmaceutical companies with big plans. The 15-person firm is focused on developing and commercializing products to treat rare diseases, like CTCL, or cutaneous T-cell lymphoma, a rare form of cancer where T-cells develop abnormalities that make them attack an individual’s skin and other conditions “where there is an unmet medical need,” according to president and CEO Christopher Schaber, who joined Soligenix in 2006.

At a bantam company like this — the Nasdaq-listed firm is in the pre-revenue stage and had a market cap of about $25 million as of early July — the CEO gets involved in just about everything, from clinical trials and quality control (Schaber holds a Ph.D. in pharmaceutical sciences) to raising capital and working with the U.S. Food and drug administration on drug approvals. “I’ve always had an entrepreneurial mentality, so starting something and helping to build it is exciting,” he said. “At the same time, it’s extremely rewarding to know that we’re developing drug therapies that may help patients with little or no treatment options.”

From a business point of view, that’s the company’s competitive advantage, since larger companies often are less likely to focus resources on rare or orphan diseases. “so there is less competition,” Schaber said. “Our goal is to be the first company to get to the market with certain products, like HyBryte [synthetic hypericin], a topical ointment that may provide a safer, more convenient alternative for people suffering from CTCL. Currently, there is no FDA-approved first-line therapy for this chronic rare cancer.”

HyBryte is in advanced development, having already completed a successful Phase 3 clinical trial. The company is now preparing to file for marketing authorization later this year and if it gets the FDA’s blessing, Soligenix will be granted seven years of orphan drug exclusivity in the U.S. In addition, the company also has the potential to receive 10 years exclusivity with regulatory approval of HyBryte in Europe.

But in the meantime, Schaber has to shepherd the company through its pre-sales revenue stage. “Since inception we’ve raised over $100 million, mainly through the capital markets, and have been awarded over $60 million in non-dilutive government funding [where the government does not take any equity stake in the company]. As of March 2022, we had approximately $23 million in cash, which includes about $10 million in convertible debt,” he said. “Right now though, market volatility is making it difficult for many small drug development companies to raise the needed capital to continue operations. We are fortunate to have the necessary cash runway to achieve our important milestones, like filing the HyBryte application to the FDA.”

Still, Schaber is very careful about spending, and he trims costs by using outsourced contract research organizations and other consultants for manufacturing and clinical trial monitoring. “This way we have the potential to more effectively manage our cash burn,” he said. “Our time-to-market schedule was pushed back by about six months because of COVID and supply chain disruptions, but our primary goal now is to launch and commercialize HyBryte in the U.S. in late 2023 or early 2024. When that happens, we will be able to help more patients and the value of Soligenix should increase, which will be good news for both the CTCL community and our shareholders. So everyone will benefit.”

Getting personal

Some biotech executives, like Ameet Mallik from ADC Therapeutics, derive personal satisfaction from doing good while helming a smaller company. Mallik spent more than 16 successful years at a global health care company in senior roles in the U.S. and Europe, rising to executive vice president. But he left the security of big pharma for the hands-on experience that smaller biotechs offer, eventually landing the top job at ADC, a biotech with 88 employees in New Jersey and some 227 elsewhere in the U.S. and internationally. The company is developing antibodies that seek out cancer cells and then feed them toxic compounds.

“I find that smaller organizations offer more opportunities to learn and grow personally,” Mallik said. “I really appreciate the sense of ownership and ability to be innovative, despite having fewer resources.” The New York Stock Exchange-listed company posted its first sales revenue last year, thanks to its FDA-approved drug, Zynlonta.

With about $430 million of cash and equivalents on hand at the end of the first quarter of 2022 and long-term convertible debt of about $115 million, he can’t spend in a carefree manner, but Mallik is confident about the company’s prospects. “We’re prudent about cash burn,” he explained. “And we recognize that escalating interest rates will make it more challenging to raise capital; but at the same time, we have a strong balance sheet, and we’re preparing for talks with the FDA about a second product.”

Ongoing supply chain disruptions have not put a dent in ADC Therapeutics’ operations, he added. “Our product has about a three-year shelf life, so we were able to build up our inventory to guard against the risk of a stock-out. And although our market valuation, like many other companies, has been depressed, we’re backed by strong science, and we believe we can ride this out and create value for potential future capital raises. So, yes, there are challenges, but there are also opportunities.”

Mallik said he feels the company is on a much different track than large pharmas, noting that ADC targets niche solutions. “In a smaller biotech you can maintain a very tight focus,” he noted. “We’re also nimble enough to make decisions in an agile fashion, without having to go through too many layers. We see our mandate as serving patients, investors and employees, and in doing so we create value for all.”

Some smaller companies may also be more willing to pursue alternative paths to cancer treatments. Tucked away in Berkeley Heights, for example, a 17-person biopharmaceutical company hopes to make big inroads with orally ingested, small molecule therapies that attack the disease on a genetic level. “We recognize that 9 out 10 attempts to discover a novel drug may fail, but the one that succeeds can make a significant difference to patients with limited options,” said Cyclacel Pharmaceuticals Inc. President and CEO Spiro Rombotis, who previously held executive positions with global biopharmaceutical companies. “At a smaller company like Cyclacel, we have the flexibility to move to risky targets sooner than larger companies.”

His company’s approach to cancer treatments is based on understanding how cancer cells become resistant to available medicines. Cyclacel’s two cancer drugs in clinical trials target proteins associated with cancer cells becoming resistant and evading existing treatments—suppressing the proteins enables the body to destroy cancer cells. Because Cyclacel focuses on oral treatments, they’re easily manufactured by third-party providers, and require less of an upfront investment compared to biologics which are mostly given by injection, according to Rombotis. “This approach requires less capital and may lead faster to clinical data.”

That’s important for the Nasdaq-listed company, which had just under $30 million in cash and cash equivalents as of March 31. Besides the sale of stock, Cyclacel currently generates most of its revenue from royalties, grants and tax credits. The company estimates its available cash will fund currently planned programs through June 2023.

As the leader of a smaller, clinical-stage company, Rombotis’ responsibilities include courting investors — and he’s quick to note that “We are one of the most advanced companies leading the race to bring to the bedside of patients novel inhibitors which may address the rising problem of cancer resistance. Our lead drug fadraciclib, or fadra for short, has shown promise in early clinical trials of patients with women’s cancers, including endometrial, and certain lymphomas. Our second drug, CYC140, is being evaluated in patients with both solid tumors and blood cancers. Our pipeline of medicines aims to provide safe and effective anticancer treatment options to patients, combined with the convenience of oral administration.”

Rombotis is sanguine about recent stock market slides that may affect fundraising for small biotechs, noting that this isn’t the first time the company has operated during periods of market disruption. “We’ve been able to raise capital over many years in part because of the integrity of our communications,” he explained. “Presenting clinical data with balance and clarity to investors, regulators and doctors is critical to building trust in our business. Ultimately our core value is to serve cancer patients who can’t wait — as we say at BioNJ, our professional association — and demand treatment options that offer a high quality of life.”