biopontis alliance for rare diseasesbiopontisalliance.org/core/wp-content/uploads/2020/... ·...

BioPontis Alliance for Rare Diseases

A philanthropic alliance turning science into medicine

Dear Friends, We are pleased to offer our 2019 Annual Report for your review. At the same time, we are very sorry to inform you that this will be the last Annual Report for the BioPontis Alliance for Rare Diseases. We explain herein why we need to dissolve our organization, and what will happen with the results.

As an international nonprofit organization with two operating legal entities in Raleigh, NC, USA (a 501(c)3 Corporation) and in Brussels, Belgium (a Foundation of Public Utility), we identify promising scientific discoveries in rare neurological disorders and translate them into disease-modifying therapies. Major developments during 2019 are:

- Our lead project, a collaboration with the Flemish Institute for Biotechnology (VIB) and the University of Antwerp (Belgium) investigating a form of Charcot Marie Tooth disease, an axonal neuropathy, has again progressed well. As you will read further below, during 2019 high throughput screening assays have identified several hits. These hits will now be further validated and optimized. The project did reach all milestones successfully, proving that our model works. We are very proud on being able to show this result at this moment!

- The BioPontis Alliance scientific team, led by its CSO, evaluated more than 25 eligible research projects from Europe and from the US for their fit to our model. After a thorough due diligence process, approximately 10% of the evaluated projects were selected using strict selection criteria. Upon signing a license and collaboration agreement with the academic partner from which the project originates, the work was started on a first project. We were not able to start other projects by lack of funding, although these projects were interesting and have a clear patient need.

- Several fundraising activities have been organized throughout the year 2019, including a dinner with prominent networkers in Belgium, meetings with bankers and insurers, meetings and conference calls with international foundations as well as contacts with wealthy private individuals and several meetings with industry. Other than a small gift from a pharma company, these meetings led to uniform support for our mission and goals, but not to additional funding.

- Therefore, due to insufficient funds, our work on the collaborative project with Massachusetts General Hospital on Huntington Disease also had to be stopped.

- The Board of Directors dissolved our LLC subsidiary in the US and inactivated our US nonprofit entity as of 31 December 2019.

- The Board of Directors decided that we will be winding down all activities, including the US and the Belgian nonprofit entity, over the course of 2020

- We were invited, based on our white paper on integration of patient’s perspectives into early research on rare disease therapy development to speak at the Global Genes Data DIY conference on helping patient’s organizations in making their research projects ready for therapy development.

- Our Chairman was a co-lead author for an important review article in Nature Reviews Drug Discovery, published online on December 13th, 2019, entitled Therapies for rare diseases: therapeutic modalities, progress, and challenges ahead.

As mentioned in our 2018 annual report, the fundraising environment has become increasingly difficult, both in the US and in Europe. As a result, we have not been able to convert the considerable interest in our mission into a sizeable and sustainable funding platform. In contrast, we note that individual projects with a clear patient face and goal can be successful in fundraising. For example, in Belgium, the family of a baby affected by spinal muscular atrophy used a crowdfunding campaign to raise 2 million euro over just 2 days to pay for a specific gene therapy treatment which is only approved in the US at this time. While that is a remarkable result, it is a pity that the structural solution that the BioPontis Alliance was designed to provide in the rare disease field, is seen as too complex and too abstract to attract funding. Nevertheless, we continue to believe in the importance of the mission of our Foundation, to support and fund translational research in rare diseases.

In summary, given the high cost of such translational research, fundraising results at BioPontis have only been sufficient to fund its first project. Although the structure for some 4-5 parallel projects is in place, fundraising was not sufficiently successful to allow further selected projects to start.

- BioPontis had no large institutional gift nor reserved funds and is dependent on ad hoc external funding. The required funds seem to be too high to raise without professional fundraisers on board, which in turn cannot be paid for by the organization.

- Many funders increasingly want return on investment (industry, venture capital, some private investors), but our projects are too early stage for a profit-driven system.

- Biopharma companies want projects to fill their pipeline. Projects at BioPontis need to mature before they are ready for a business development transaction. BioPontis' mission is to raise seed money to get to that stage but industry rarely if ever budgets unrestricted funds for such purposes.

- Many foundations, funding agencies and charity funds don’t prioritize funding of rare diseases, or only fund basic research on them.

- Public funding is much more readily available for research on specific single diseases rather than for the systematic, structural approach to rare diseases, which is what society needs.

- Some foundations and potential funders don’t support virtual organizations like the BioPontis Alliance, but want to support brick-and-mortar institutes.

- The EU investment bank and the European investment Fund which are EU financial institutions, found the BioPontis Alliance approach too early for them to be involved.

We hope that lessons can be learned from the BioPontis Alliance experience and that it can be continued in a new way, or that its model can be taken up by others. As we have

noted before, 94% of patients with rare diseases have no approved therapy so their need remains sky-high. Since The BioPontis model was widely accepted and our mission widely supported, and because we were also able to prove that our approach can work with our first project, we hope that we will inspire new entrepreneurs, who understand and support our innovative model in treatment development.

In conclusion, we like to wholeheartedly thank our fantastic Board of Directors. We also thank our tremendous group of scientists and other volunteers, our magnificent Scientific Advisory Committee, all the endorsing institutions and collaborating patients’ groups, as well as our benevolent pro bono supporters, our staff and last but not least our Partners at VIB and the University of Antwerp for a great collaboration and for all their efforts, as a team and individually.

With sincere regards, Erik Tambuyzer, PhD David Spencer, PhD Chairperson and CEO Vice Chairperson

MISSION The BioPontis Alliance for Rare Diseases is an international nonprofit organization whose mission is to advance promising academic discovery science into potential treatments for rare neurological diseases. We meet our mission by involving patients in the development of their own treatments, through alliances with patients’ organizations and research institutions worldwide

Report of Scientific Progress As we reported previously, BioPontis is collaborating with researchers at the University of Antwerp (Belgium) and the biotech research Institute, VIB, in Flanders, Belgium to identify a small molecule therapeutic designed to correct a mutation in the protein that is responsible for the neuromyotonia that characterizes Charcot Marie Tooth (CMT) disease. If successful, a therapeutic in this area will restore the functionality to this protein, thereby alleviating these effects. Towards the end of 2018, efforts were initiated with VIB to develop a high-throughput screening (HTS) assay for use in the identification of potential hits from a library of 30000 compounds.

The team has identified the R37P point mutation of the HINT1 protein as the substrate of interest in a comparatively small set of CMT patients. Unfortunately, this protein is unstable and therefore it is not suitable for use in an HTS assay. As a result, the HTS assay was intentionally designed to use the wild-type HINT1 (WT-HINT1) protein as the substrate. It was hypothesized that molecules that activated WT-HINT1 protein could also have an effect on R37P HINT1. For these reasons, the HTS assay that was developed and characterized at the VIB Screening Core facility identified modulators / activators of WT HINT1 enzymatic activity.

The first half of 2019 was devoted to the development of the WT-HINT1 based HTS assay, including efforts to optimize the assay conditions, develop an appropriate automation protocol and transfer the assay from the bench to the screening facility. The assay that was developed measured WT HINT1 enzymatic activity that generates a luminescent signal which is mediated by HINT1. An increase in this signal indicates an increase in enzymatic activity of WT HINT1. After the assay was validated and successfully transferred to the screening facility, two internal libraries of 30000 compounds were tested in the HTS screen. The primary hit (positive modulators) rate was ~0.2% for the larger library composed of 20000 drug-based structures and

~0.08% for smaller library of 10000 pharmacologically diverse compounds. Overall, the HTS assays identified 48 primary hits from these two libraries.

At the end of the year, testing was initiated for confirmation of the screening program. In this phase, primary hits were retested using the conditions of the HINT1 primary assay followed by testing in an assay a different substrate, and finally, in an assay designed to eliminate false-positives.

During 2020, the plan is to complete the confirmation phase of the program and then begin efforts to more fully characterize the activity of the hits identified in the initial screening HTS assay. These additional studies will demonstrate activity against the mutant HINT1 enzyme and expand the testing program into other relevant in vitro assays.

Other programs, including the Huntington’s Disease research agreement with Massachusetts General Hospital and with the AHC foundation concerning a potential collaboration had to be stopped due to lack of sufficient funding.

Report on Patient Integration In 2017, the BioPontis Alliance made the Translational Research Readiness Tool (TRRT) available, downloadable from our website. It gives a basis for patient organizations to assess how far their sponsored research has progressed towards the point of enabling research on actual treatment options for the genetic neurological disease of focus. A number of organizations have made use of it since then, but in 2019 we were able to bring it to the attention of Global Genes and the Chan Zuckerberg Initiative (CZI) for their “Rare as One” program. Global Genes distributed the TRRT in the workbook of their CZI-sponsored “Data DIY #3” workshop held on October 25, 2019. Their fourth Data DIY workshop was held on February 3, 2020, where the TRRT and the work of BioPontis in science and patient integration efforts was presented in person. On the next day, a series of mentoring exercises were held between BioPontis personnel and patients’ organizations. Slides presented at that meeting can be viewed on the Global Genes website (https://globalgenes.org/data-diy/ ).

In December of 2019, an important resource for the rare disease community was published in Nature Reviews Drug Discovery by co-lead author and Executive Chairman of the BioPontis Alliance, Erik Tambuyzer. Erik collaborated with fellow authors from the FDA, EMA, NIH and numerous Universities to write “Therapies for Rare Diseases: Therapeutic Modalities, Progress and Challenges Ahead”.

The review article summarizes the following aspects of rare disease: definitions, medical technologies used as therapeutic alternatives, clinical successes by technological approach, and up-to-date statistics on regulatory approvals by disease area and technological approach. There is also very useful information on the importance of natural history studies, biomarkers and patient-reported outcomes. This paper will be a key point of reference for those doing work in the rare disease field for years to come.

Actions to Build Upon Our CMT Research As the BioPontis Alliance concludes its activities as a non-profit organization, it has been recognized that it is vital to make sure that the progress made in developing therapies for HINT1-related CMT are used and built upon further. To that end, the BioPontis Alliance has returned rights to the program to the Flemish Institute for Biotechnology (VIB) in Belgium, along with a substantial further grant of funds. Those funds will be used to further characterize hits already identified in the screening program and continue progress towards identifying potential lead compounds that can be used as a basis for drug development. VIB, the receiving organization, together with the University of Antwerp (UA) which did the basic research, are well suited scientifically and technologically for the task and a research program to accomplish these objectives, as well as steps to potentially license the results have been agreed.

We are grateful for the pro bono support from: ❖ A&T Accounting, Leuven, Belgium ❖ Jones Day Law Firm, Brussels, Belgium ❖ Leo Stevens & Cie, Antwerp, Belgium As well as support from Hutchison PLLC, Raleigh, NC, USA.

Board of Directors and Executive Team Erik Tambuyzer, PhD, Chairperson and CEO David Spencer, PhD, Vice-Chairperson Jean-Jacques Cassiman, MD Susan Kahn, Treasurer Howard Liebman, Esq. Christian Policard, PhD Warren Strittmatter, MD, co-Chairperson of the Scientific Advisory Committee

---------- Gilbert (‘Chip’) Carnathan, PhD, CSO, co-Chairperson of the Scientific Advisory Committee Patricia Holoman, Development

BioPontis Alliance Rare Disease Foundation, Inc. (U.S.)

and

BioPontis Alliance for Rare Diseases Fup/Son (Europe)

Combined Financial Statements

December 31, 2019

Combined U.S. Europe

Current AssetsCash 122,134$ 8,625$ 113,509$ Receivables 14 14 -

Total Current Assets 122,148 8,639 113,509

Total Assets 122,148$ 8,639$ 113,509$

Current LiabilitiesAccrued expenses 64,674$ 18,329$ 46,345$ Other current liabilities 4,963 - 4,963

Total Current Liabilities 69,637 18,329 51,308

Total Liabilities 69,637 18,329 51,308

Net AssetsWithout donor restrictions 52,511 (9,690) 62,201

Total Net Assets 52,511 (9,690) 62,201

Total Liabilities and Net Assets 122,148$ 8,639$ 113,509$

(shown in $USD)

Assets

Liabilities and Net Assets

These statements have not been subjected to an audit or review or compilation engagement, and no assurance is

* These statements are presented on the liquidation basis of accounting to reflect the dissolution of both entities in 2020.

Page 1

BioPontis Alliance Rare Disease Foundation, Inc. (U.S.) &BioPontis Alliance for Rare Diseases Fup/Son (Europe)

Combined Statement of Assets, Liabilities, and Net Assets - Liquidation Basis *December 31, 2019

provided on them. The statements omit substantially all of the disclosures ordinarily included in financial statements.


Net Assets Without Donor Restrictions

Revenues and SupportIndividual contributions 343$ 343$ -$ Grants - foundations 59,438 - 59,438 Miscellaneous income 3,000 3,000 -

Total Revenues and Support 62,781 3,343 59,438

Expenses

Science Disease Development Projects 92,157 - 92,157

Patient Engagement 309 - 309

Partnerships & Alliances 36,517 36,517 -

Support Services Development 2,107 876 1,231 Management & General 73,462 59,123 14,339

Total Operating Expenses 204,552 96,516 108,036

Change in Net Assets Without Donor Restrictions (141,771)$ (93,173)$ (48,598)$

Page 2

BioPontis Alliance Rare Disease Foundation, Inc. (U.S.) &BioPontis Alliance For Rare Diseases Fup/Son (Europe)

Combined Statement of Support, Revenue, and Expenses - Liquidation Basis *

(shown in $USD)




For the Period January 1, 2019 - December 31, 2019


Net Assets Without Donor Restrictions

Beginning of year 195,665$ 3,024$ 192,641$ 2019 Change in unrestricted net assets (141,771) (93,173) (48,598) 2019 Intercompany transfers - 80,459 (80,459) Foreign currency translation (1,383) - (1,383)

End of year 52,511$ (9,690)$ 62,201$


Page 3


Combined Statement of Changes in Net Assets - Liquidation Basis *For the Period January 1, 2019 - December 31, 2019



(shown in $USD)

DiseaseManagement Development Patient Partnerships

& General Development Projects Engagement & Alliances Total

ExpensesPromotional materials 96$ -$ -$ -$ -$ 96$ Development expenses - 230 - - - 230 Dues and subscriptions 288 - - - - 288 D&O insurance 13,736 - - - - 13,736 Office expenses - postage and delivery 300 - - - - 300 Professional fees - management 23,200 - - - 36,000 59,200 Professional fees - accounting 16,081 - - - - 16,081 Professional fees - legal 16,294 - - - - 16,294 Scientific research expenses - - 92,157 - - 92,157 Information technology 1,192 - - - - 1,192 Website expenses 100 300 - - - 400 Software expense 28 - - - - 28 Bank service charges 448 - - - - 448 Licenses and fees 1,460 346 - - - 1,806 Loss on currency exchange 228 - - - - 228 Travel - - - - 517 517 Travel - airfare - 746 - - - 746 Travel - ground transportation 11 485 - 309 - 805

Total Operating Expenses 73,462$ 2,107$ 92,157$ 309$ 36,517$ 204,552$

Page 4


Combined Statement of Expense Detail by Function - Liquidation Basis *For the Period January 1, 2019 - December 31, 2019

(shown in $USD)

provided on them. The statements omit substantially all of the disclosures ordinarily included in financial statements.These statements have not been subjected to an audit or review or compilation engagement, and no assurance is


Percent of Combined Total Expenses

Expenses

Science 92,157$ 45%

Patient 309 0%

Partnerships & Alliances 36,517 18%

Development 2,107 1%

Management & General 73,462 36%

Total Operating Expenses 204,552$ 100%


Combined Statement of Expense Summary - Liquidation Basis *

Page 5

For the Period January 1, 2019 - December 31, 2019(shown in $USD)




EUROPE: The BioPontis Alliance for Rare Diseases fup/son

Boulevard Auguste Reyerslaan, 80 B-1030 Brussels, Belgium

Enterprise number BE 0636997218

USA: The BioPontis Alliance for Rare Disease Foundation Inc.

13200 Strickland Road, Suite 114-244, Raleigh, NC 27613 US IRS EIN 46-4764835

http://biopontisalliance.org

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