BEIJING – After being a health care investor for 21 years, Jonathan Wang decided to co-found biotech startup Inmagene Biopharmaceuticals Co. Ltd. in July 2019 to seek success in the China market using the experience and insights he had accumulated over the years. With $20 million in its war chest so far, the startup aims to excel in immunology-related therapeutic areas in China.
Its central focus is autoimmune diseases. Last week, Inmagene in-licensed an IL-17 inhibitor known as ABY-035 (IMG-020) from Solna, Sweden-based Affibody AB. ABY-035 is aimed at multiple indications, including psoriasis, and is an example of how Inmagene leverages global technology to address unmet medical needs in China, Inmagene’s CEO told BioWorld.
Wang, who keeps both entrepreneurship and financing in mind, said he believes clinical needs should come before science. With an in-depth understanding of China, he also believes that developing affordable drugs will work well for China’s market landscape.
Market and business before science
Wang’s “MBS” strategy – market, business, then science – came into play from the start. He said management started to think strategically on day one, identifying autoimmune diseases as the next big market that had low competition at the time, and then looking for compounds that fit its core business.
“There are many business aspects of developing a drug: how large the market is, how likely it is that we can reach the market, whether there are enough financial resources, whether our people are capable of performing,” Wang said. “We do a lot of business analysis before we dive into science.”
A veteran investor, Wang has seen many failed examples of pharmaceutical businesses in China, mainly ones where scientists believe they can found a company and lead it to success with only scientific knowledge. “They don’t look at the clinical and business aspects of things and only pay attention to science. That’s very dangerous,” he said. “The development of a drug involves people, financial resources and unmet medical needs. While they may start well, later they are likely to run into trouble.”
Like others, Inmagene emphasizes innovation with products having first-in-class or best-in-class potential, but Wang stressed that the company is “very much guided by clinical needs” rather than “driven by scientific discovery.”
“And when we look at the medical aspects, our focus is more on the clinical than the scientific. A compound can make perfect scientific sense, but it may not generate good clinical results,” he added.
Focus on market needs
Inmagene’s first drug candidate, IMG-020, is an example of how Wang focuses on what the market needs.
Other than IMG-020’s clinical data demonstrating the compound’s efficacy and safety as well as its best-in-class potential, its cost-efficiency is also a reason Inmagene finds it worth adding to its pipeline.
“Competing IL-17 products are antibodies, but ours is a smaller fusion protein, one-eighth the size of a typical antibody,” Wang explained. “It’s important because technically we can use much smaller doses to treat patients with equal or even higher efficacy. Our candidate needs only one shot while many competitors need two. Also, it is cheaper to manufacture IMG-020.”
He noted that IMG-020 is made in an E. coli system instead of mammalian cell lines, which means IMG-020 costs around 5% of the competing antibodies.
The emphasis on cost-efficiency comes from the fact that China is a very different market from Western countries, Wang explained. The population overall is price-sensitive, and the majority of people cannot afford expensive drugs. While about 80% of the autoimmune market in the U.S. is in advanced, expensive protein products, only 17% in China’s comprises those types of products. Although China’s population is more than four times that of the U.S., the Chinese market is only about one-20th of the U.S.’ by value.
“It’s not that China sees fewer patients. Chinese patients just cannot afford expensive advanced therapies, even though all the other IL-17 products are efficacious,” Wang said. With its lower manufacturing cost, he said he believes IMG-020 is a product better suited for the China market. Inmagene plans to advance IMG-020 to IND stage by the end of this year.
Global partnering 2.0
Wang said the team, which has global exposure and experience, will work with Affibody to develop IMG-020 for five indications in worldwide markets. Contributing both clinical development expertise and costs, Inmagene will lead two of the indications in global trials and will be paid in milestone-based payments and royalties by Affibody.
That collaborative model is what Wang describes as “global partnering 2.0.”
“The new generation of Chinese biotech entrepreneurs like us does not only think about China. We are trying to integrate the most efficient drug development resources worldwide,” he said. “Then, we share not only in China but also globally.
“It’s a new way of collaboration. It’s a lot cheaper, the payments go both ways, and it makes [drug development] for both sides much faster as well,” he said.
Building a balanced pipeline
Inmagene is building a balanced pipeline, which Wang described as a collection of diversified products. The startup is now in the process of in-licensing a potentially first-in-class compound with global intellectual property rights, which has finished its phase I study. The drug is known as IMG-021 in its pipeline.
But the cautious CEO also understands the high risks that come with that cutting-edge compound. Considering such high risks, Inmagene intends to develop it for an ultra-rare disease first.
“The reason is that we can do a very small trial in China to quickly determine whether it can be used as a drug or not,” Wang explained. “If it works, we can expand it into many other diseases.”
Another asset, referred to as IMG-002, which Inmagene also is in the process of in-licensing, has best-in-class potential and can compete against a drug that generated $3 billion of revenue last year. Wang said that compound has a better safety profile and is ready for phase III trials.
Cost-efficient innovation for global IP
For Inmagene’s R&D plans, the startup will not focus on discovery but will bring in promising candidate-stage products from partners.
“Many companies do great in science, but the science is not guided by medical needs,” he said. “We would look at the unmet medical needs first, then go to our partners who have proprietary technologies to ask them to generate drug candidates to fulfill such needs. We would take those candidates all the way to clinical development.”
Wang said he believes cost-efficient innovation will be a key to success in China. “We can do comparable quality work but at a much lower cost at the preclinical stage,” Wang explained. “Hangzhou is one-third to two-thirds cheaper than Boston. With the same financing, you can push more candidates into clinical stages.”