“Our prospects were looking good at the start of last year; they’re still looking good, but we also survived one of the worst capital markets ever,” Cormack says. “For a company like this that is dependent on equity for survival, that’s a pretty pressing issue.”
As lenders shut off the money flow in June, Cormack considered taking the company public but decided that trying to raise capital through an IPO would be too risky given the state of the economy. Desperate, he began looking for a struggling biotech firm with an existing stock exchange listing that OncoGeneX could buy, and he didn’t have to look far. In August, after several arduous weeks of negotiation, OncoGeneX completed a reverse takeover of Sonus Pharmaceuticals Inc., a Seattle-based biotech with two weak product candidates and about $20 million in available capital. “They were mired in a late-stage product failure, but they had some money in the bank,” Cormack says. “And we got a NASDAQ listing out of it.”
Four months later, OncoGeneX announced that Phase-2 clinical trials for its lead product, OGX-011, showed a 40 per cent reduction in the probability of death from prostate cancer when combined with the chemotherapy medication docetaxel. Since then, share prices have climbed from $4 to more than $26.
Developed by OncoGeneX co-founder Martin Gleave, a surgical oncologist at Vancouver General Hospital, OGX-011 inhibits the growth of a protein that allows cancer cells to regenerate following conventional radiation treatments. “It’s like taking away their defences,” Cormack says.
Gleave began toying with the concept in the early ’90s, after he became increasingly frustrated with the way patients’ tumours were adapting to treatment. OGX-011 evolved from ongoing tests he conducted on tissue samples taken before, during and after treatments.
The partnership between Gleave and Cormack germinated in 1999 when Cormack was a venture capital manager with RBC’s life sciences division. They formed OncoGeneX in May 2000 and, for less than US$1 million, managed to advance their lead drug to clinical trial stage in about 14 months. Variations of the drug are undergoing clinical trials for breast and lung cancer treatments. As an upstart company, OncoGeneX runs a much leaner operation than bigger, better-funded biotech firms, Cormack says, estimating the total investment since inception at $35 million.
Recent successes aside, Cormack admits there’s a long way to go before the company’s products hit the market, and plenty of potential pitfalls along the way. “It takes a bit of a unique character to do what we do,” he says. “We go for years and years without a sale . . . and you can be remarkably successful or you can be a complete bust. It’s definitely not for the faint of heart.”
