May 23, 2008
San Francisco Business Times
UCSF trio hopes to draw cash with titanium tube
Mix three young minds with a two-inch-long tube of titanium in an entrepreneurial, science-based setting and you get a new and potentially cheaper way of delivering drugs.Now the creators of Titan Medical -- which earlier this month was a co-winner of a business plan competition hosted by the University of California, Berkeley's Haas School of Business -- hope to move their idea to market.All they need is cash: $3 million to bring them to the clinical trial starting line and $15 million a few years later to push through Phase I and II trials and into the arms of a licensing partner."What we have is really a platform," said Adam Mendelsohn, 26. "Now we can improve on it."Along the way, the Titan trio -- UC San Francisco bioengineering Ph.D. students Lily Peng, Kayte Fischer and Mendelsohn -- have cultivated the advice and connections of an angel investor, venture capitalists and the California Institute for Quantitative Biosciences, or QB3.It helps that Titan has what could be a higher-margin, less-invasive method of delivering an established drug. Plus, Titan's initial target, chronic hepatitis C patients, offers a U.S. market of some 3 million people.Titan shared first place in the Berkeley Business Plan Competition with Implicit Interfaces, which developed an online retail search technology. The competition, judged by a panel of venture capitalists, attorneys and angel investors, included two other groups with biotech or medical devices among the eight finalists.Mendelsohn, Peng and Fischer work in the lab of UCSF professor Tejal Desai. That positions them down the hall from QB3, where the institute's clinical director, Marc Shuman, has taken an interest in the young company.It's the type of collaboration that the state and the UC system bet would happen when they set up QB3."If this is any indication of what's to come, we're in for a lot of pleasant surprises," Desai said.Titan's advisers include angel investor Ross Johnston as well as Michael Carusi and Amy Belt of Palo Alto-based venture capital firm Advanced Technology Ventures, whose portfolio includes Five Prime Therapeutics Inc.For the business plan competition, the team also included UC Berkeley M.B.A. student Steve Dugan, who isn't continuing on with Titan.Titan's device -- which if successful with financing, successful clinical trials and Food and Drug Administration approvals could hit the market as soon as 2013 -- uses a sheet of connected titanium oxide nanotubes to create a biocompatible membrane through which a drug is pumped into the bloodstream at a steady rate, Mendelsohn said.No bigger than a matchstick at about 3 millimeters in diameter, the cylindrical device is implanted in the upper arm in a 10-minute procedure and could be used for at least three months.In the case of hepatitis C, the implant could eliminate weekly needle pricks that deliver interferon alpha, mostly Hoffmann-La Roche Inc.'s version of the drug, Pegasys.Such chronic shots are debilitating and depressing for patients, said Peng, 24, an M.D./Ph.D. student who gathered anecdotal support for Titan's device by talking to patients in UCSF's liver clinic.What's more, she said, injections typically include a spike in drug activity and carry side effects, followed by a dip in activity and reduced effectiveness. Then the whole process is repeated the next week.Mendelsohn said Titan's method also could use an older, cheaper version of interferon alpha. That's because the device, not the formulation of the drug, would determine how much is released. Still, he added, Titan would likely sell at Pegasys' current $13,500 retail price.Titan's clinical trials are key for proving that its pump can deliver drugs steadily, said Belt, a senior associate at Advanced Technology Ventures. But she said the team already has uncovered two important factors."It's not reformulating a drug," she said. "You're making it easier for patients."