Better Drugs Through Diagnostics

Pharmaceutical Executive

Pharmaceutical Executive, Pharmaceutical Executive-02-01-2004,

The genomics revolution may not have ushered in the age of personalized medicine the way healthcare experts predicted, but innovative diagnostics keep pushing the industry toward the ideal of the "right drug for the right person at the right time. "One company that exemplifies that model is CeMines, a Colorado-based enterprise with an impressive, noninvasive cancer diagnostic in development. The product, which uses molecular fingerprinting to test blood samples, has had a 100 percent accuracy rate for every trial conducted. It not only determines-even in early stages-if a patient has cancer, but provides guidance for which type of treatment will work best.

The genomics revolution may not have ushered in the age of personalized medicine the way healthcare experts predicted, but innovative diagnostics keep pushing the industry toward the ideal of the "right drug for the right person at the right time."

One company that exemplifies that model is CeMines, a Colorado-based enterprise with an impressive, noninvasive cancer diagnostic in development. The product, which uses molecular fingerprinting to test blood samples, has had a 100 percent accuracy rate for every trial conducted. It not only determines-even in early stages-if a patient has cancer, but provides guidance for which type of treatment will work best.

Another extraordinary thing about the company is that neither Richard Cavalli, CeMines' president, or Bailey Dotson, its CEO, has a pharma background. So how did two real-estate moguls get involved in a business based on transcription factors, molecular fingerprinting, and auto-antibodies?

Chance and Chemistry

The company began the way many startups do, with a chance meeting between two innovative thinkers with the drive to combine their ideas into a successful venture. In 1999, Cavalli, a Colorado businessman, met Tom Neuman, PhD, a molecular biologist at Cedars-Sinai Medical Center in Los Angeles. Cavalli was fascinated by Neuman's 20 years of work in transcription factors (proteins involved in gene expression), and Neuman was emboldened by Cavalli's confidence in his work.

The Minds Behind CeMines Richard Cavalli (left) founded CeMines on the strength of its lead scientis's work. Bailey Dotson (right) came on board soon after and helped fund the company.

"So I just put it out to Tom that I was quite impressed with him," Cavalli recalls. "We seemed to have very good chemistry, and we were able to put together a business plan and start CeMines." Named for "cellular mining," CeMines was found-ed in April 2000 in Cavalli's hometown of Evergreen, Colorado. Cavalli's confidence also lead him to invest a half-million dollars from a personal trust into the startup. Soon after, Bailey Dotson, Cavalli's business associate, came on board, and the two men eventually funded the company with another combined half-million dollars from their real-estate development businesses. But CeMines isn't dependent on its founders' faith and generosity. An additional source of funding comes from sales of reagents to more than 150 research institutions worldwide, generating $1.2 million so far. CeMines was developing antibodies for its own research and saw a business opportunity to offer unique reagents to other researchers. The company has also sold $1 million in common stock.

"Our reagents business is increasing in size and number," Cavalli reports. "We have a very good reputation in the research community for providing products that work very well. And we recently created partnerships with the top two industry leaders, Sigma Aldrich and Chemicon International, that have boosted our sales significantly and have opened doors to future increases."

But of course, all that funding is for one greater purpose: to drive the development of the company's star project-blood tumor antibody diagnostics.

Strictly Science

Most cancer is currently detected through imaging or biopsies, both of which take place when the tumor is quite large and difficult to treat. A few blood-based diagnostics for hormone-related cancers are on the market, such as the PSA test for prostate cancer and the CA-125 test for ovarian cancer. Neither method is ideal or highly accurate. CeMines' technology combines the best of both worlds. Tumors, which are homogenous in the early stages, develop subpopulations of malignant cells, which trigger the body to produce unique auto-antibodies. The diagnostic tests the patient's blood against dozens of known cancer antigens, looking for a reaction with cancer antibodies. The screening identifies the highly specific molecular subtypes of cancer by analyzing a network of cell regulatory factors. In finding the tumor's cellular fingerprint in the bloodstream, the diagnostic can detect the presence of cancer very early. And by testing it against dozens of antigens, the diagnostic can determine which type of cancer is present. (See "The CeMines Technology.") Neuman, CeMines' chief scientific officer, puts it simply: "There are hundreds of published papers in which people have shown that at the molecular level there are different groups of tumors. Everybody can do it when they have a piece of tumor. What we can do is identify the different molecular groups using noninvasive techniques."

But the technology goes beyond that. "It not only will provide the diagnosis, it will provide a description of the tumor's structure at the molecular level so that targets can be drawn precisely," Cavalli says. "It will offer guided therapeutics, because with a known molecular fingerprint, we can access a database that will show how each specific tumor has reacted historically to specific treatment regimens."

The result is that the company will be able determine which treatment has worked well for that cancer subgroup before. That is good news for patients, who often have to undergo multiple regimens. The diagnostic also allows oncologists to monitor patients whose cancers come back. "What happens is that tumors change," Neuman says. "The patient has one tumor type right now, and in two years, the same patient may have a modified type of the same tumor. So he actually needs a completely different treatment strategy." »

Upside for Pharma

"The big payoff for the industry is in drug approval," Dotson says. "We believe the technology addresses two areas: the molecular understanding of the tumor and how various drugs interact with it, both of which help determine what the side effects are. We think there is an opportunity for pharma to take another look at some of the 400 or so drugs that didn't make it through Phase III." In theory, using the test to screen trial subjects will allow cancer drugs in development to demonstrate greater success rates.

The CeMines Technology When the body detects an invader, such as cancer, the immune system is called to action. By checking the blood for signs of such activity, CeMines' molecular fingerprinting test can detect cancers in their earliest stages, allowing for more effective treatment.

Other good news for the industry is that CeMines' database of molecular cancer fingerprints will eventually allow pharma companies to "design intelligent therapies that target specific signaling pathways," Neuman says. "That is our long-range goal," Dotson adds, "to develop a whole new generation of more intelligently designed drugs that are really a rifle shot to the tumor rather than the shotgun approach that we are forced to use today."

But all that is down the road. Short term, to get FDA approval, the company must conduct large-scale trials with 1,000 people or more. And it may need an additional source of funding to make that happen. "Rather than looking to the market to raise the money," Dotson says, "we are probably looking at partnering. We've had preliminary discussions with two or three major companies."

Fast Track

But the company isn't waiting around for a partner; it's moving forward full steam. "Every test we've done to date has been with hand-created slides that are labor intensive and very slow," Cavalli says. "But we are changing that. By March, we will have ramped up our lab and research capability so that we can automate the tests and create our first prototype. The numbers in our studies are going to accelerate dramatically. We have been in conversations with several well-known cancer research institutions that have clinical specimens in the freezers, and they are simply waiting for a test to be delivered. And we're looking at that happening in the first half of next year." Neuman is optimistic about a speedy FDA approval for a monitoring indication: "What we hope is that we will get all the data in the next six months. With convincing data and a 510K application to FDA, we believe we can have our first-generation monitoring test approved and available within 18 months. The test will make it possible for physicians to accurately track the progression or remission of a specific cancer type." CeMines is currently testing the diagnostic in 100 breast cancer patients, 300 gastrointestinal cancer patients, and 1,200 heavy smokers.

The executives all have good reason to be upbeat. The results of the company's study (n=175) in September 2002 were 100 percent accurate in identifying 134 lung cancer patients and 41 control patients who were cancer free. Smaller studies-11 gastrointestinal cancer, 10 breast cancer, and 21 prostate cancer patients-have also been 100 percent accurate.

Ultimately, CeMines would like to see its test become part of a routine physical for everyone over 40 and anyone with a high risk profile for cancer. The executives say they plan to keep the price in the $200–$300 range, and they've consulted with reimbursement experts to ensure their product will be accepted and supported by payers.

Moving On

Now that the company is rapidly moving toward an FDA filing, the executive team is ready to turn over operations to people skilled in navigating regulatory waters.

"Although Richard and I don't have a big pharmaceutical background," Dotson says, "we think our business experience has taken CeMines from just a theoretical concept in 2000 to a company that is flowing cash through our reagents division, is developing very promising science, and is moving into commercialization with our first generation of cancer monitoring and screening tests.

"Moving into 2004, we are looking for a CEO and a chief financial officer who are very experienced in biotech. Meanwhile, our chief operating officer has more than 20 years of experience in FDA regulatory affairs and bringing pharmaceutical products and devices to market, and we have the benefit of very experienced pharma and financial industry guidance from our board members," he adds.

"After bringing in experienced people, Richard and I will then move on to being board members and members of the executive committee to stay involved. With expert biotech leadership, adequate funding, and a strong board, we believe our platform technology will change the way we diagnose and treat cancer."