HONG KONG – Established in February, South Korean biotech startup Bionetix Inc. has already secured a partnership with Southern Research to develop cancer drugs, and plans to move into the clinic with a lead program targeting glaucoma in 2019.

Bionetix was founded by the trio of company executives – CEO Doo Young Jung, Chief Technology Officer Jin Soo Lee and Managing Director Hyun Yong Cho – as an employee entrepreneurship program of the Korea Research Institute of Chemical Technology (KRICT), which gives it advantages in acquiring exclusive rights of promising agents. Jung had previously worked at the government-funded KRICT and was an examiner at the Korean Intellectual Property Office.

Lee is the former R&D head of Dongwha Pharmaceutical Co. Ltd., a 120-year-old Korean pharmaceutical company based in Seoul. And Cho is the former vice president of German technology company Heraeus Materials Ltd., who is also an expert in open innovation project management.

Bionetix focuses on the translational approach of new drug discovery and development. It aims to incubate basic sciences from public research institutes from all over the world to valuable drug candidates with human proof of concept to expedite the development of innovative novel pharmaceutical products.

What makes Bionetix unique is that it's a virtual biotech company utilizing both internal and external R&D networks.

"Bionetix is composed of network R&D platforms based upon three layers – [an] internal team of experts who selects and manages the development of each project, basic science providers who do discovery-stage R&D activities under the support of Bionetix until the candidate selection stage, and [a] development-stage network who supports Bionetix for the preclinical and early clinical development stage where human proof of concept can be achieved," said Jung.

The current pipeline of Bionetix consists of two preclinical-stage small-molecule candidates. One is a topical glaucoma treatment with a aqueous humor formation-lowering agent, in-licensed from KRICT, and the other is a small-molecule epigenetic cancer agent, currently under collaborative development with Southern Research.

"Bionetix is doing its best to develop the glaucoma treatment agent and the program is in the preclinical chemistry, manufacturing and control development stage, which is scheduled to be completed within this year," Jung told BioWorld.

The company is planning to complete the good laboratory practice-toxicology studies of the glaucoma program in 2018 and is planning to initiate the clinical trial in early 2019. Bionetix initiated the collaborative development program for the cancer program with "second layer" R&D partner Southern Research in July 2017. The cancer program is an orally administrable epigenetic modulator with excellent in vivo efficacy. The drug can affect a key genetic switch associated with suppression and regulation of the growth of certain types of cancer.

Bionetix plans to roll out the development in two ways.

"Firstly, by taking the advantage of its excellent anticancer efficacy, this agent will be developed as a conventional epigenetic modulator for anticancer application," said Jung. "Secondly, by taking the advantage of its unique mechanism of action [MOA], this program will be combined with various immunotherapy agents such as checkpoint blockade agents or CAR to be developed as an immunotherapy adjuvant."

The goal of the collaboration is to select the candidate and finalize the development plan by the second half of 2018, begin preclinical development in 2019 and commence clinical trials in 2020.

How it all started

Jung said his experiences at KRICT were crucial to the decision to establish Bionetix.

Being an organic chemist by training, Jung didn't start working in the biotech space until he joined the business development department of KRICT, where he was responsible for licensing candidate compounds the researchers discovered to Korean pharmaceutical companies, biotech ventures and global partners.

"I realized that the approach of efficiently incubating the basic sciences of public institutes to valuable drug discovery programs is a valid and very important approach for developing innovative new medicines," he said. "Also, by taking this approach, many projects are pursued cost-efficiently and simultaneously."

Jung said he believes that in addition to scientific excellency, the business development capacity is also needed to draw successful contribution from various organizations, including universities, hospitals, research institutes and industry players.

"Business development [personnel] should manage the relations with science providers regarding the IP ownership, commercialization rights and so on, as well as manage the relations with industry partners for successful licensing of the project results," said Jung.

"I've also had chances to observe the process of establishment and operation of biotech ventures and these experiences made me determine to found Bionetix," he added.

Although the oncology and ophthalmology space has huge market potential, it wasn't Bionetix's choice to only go for indications in those two therapeutic areas.

"I think the decision was made due to the circumstances surrounding Bionetix," said Jung. "In the concept design of Bionetix, the team members thought to pursue a company dealing with technologies that can target unmet medical needs without considering the indications. . . . if we meet a novel technology, we evaluate it, and if we think there are things we can contribute to make it a valuable drug asset, then we might begin the project without considering the disease.

"However, after founding Bionetix and during the course of its operation, we have found out that it will be very hard for us to expand beyond the two disease areas we are currently operating with the limited resources we have," he said. "Thus, we determined to focus on the technologies in the field of oncology and ophthalmology to generate synergism with the two current programs."

The more the merrier

"We want to begin collaborative research projects with public research institutes possessing validated tool compounds or early lead compounds," said Jung. "Currently, we are discussing with Korea-based public research institute and other global partners to add two or more projects to our portfolio. We are aiming for two oncology programs – one immunotherapy, one conventional program that can show MOA-based synergism with our current oncology asset."

Bionetix will fund the researchers in the institutes and provide guidance to expedite the development of drug candidate compounds. After the development candidate is generated, the company will acquire the exclusive right for the candidates and related IPs following pre-determined conditions set forth in the collaborative research project and will develop the candidate compounds using its CRO and CMO networks.

Bionetix values different characteristics of potential partners in the short term and in the long term. Established research institutes are the targets for collaborations in the near future because they can provide both the biology and chemistry in-house.

"In the near future, since there might be a risk of being short of resources due to the virtual characteristics of Bionetix, we prefer to work with institutes with fully integrated drug discovery research capabilities – such as KRICT, SR or hopefully with Lead Discovery Center of Max Planck, Cancer Research UK, and so on.

"However, in the longer term, the company is pursuing to establish multiparty collaboration, including biology provider, med-chem specialists and project managers of Bionetix," said Jung. "In such cases, what we will look for in the partners is the scientific excellence in the field."

Eying an IPO

According to the reports of Korean Venture Capital Association (KVCA), the total investment in the biotech and biopharma sector was $79 million in the first quarter of 2016, but it dropped to $45 million in the first quarter of 2017.

"The [upward] trend has changed since the second half of 2016 – the volume of investments is being curtailed, and the trend is still continuing," said Ahryon Cho, general manager of Mirae Asset Venture Investment, one of the investors behind Bionetix.

"It is generally accepted that Korean venture capitals do not have preferences for the specific indications or specific type of technologies – they do not discriminate [between] companies with small-molecules or biologics, or companies with specific indications," said Cho. "However, due to the fact that [the] Korean pharmaceutical market is relatively small, they prefer companies with globally acceptable technologies, products or networks, so that they can make meaningful profits."

From the technological perspective, Bionetix's goal in the next five years is to achieve human proof of concept for the glaucoma treatment, which includes safety, intraocular pressure reduction and optic nerve protection.

The primary target markets for the glaucoma drug will be eastern Asian countries such as Korea and Japan.

The company is also aiming to begin early clinical development of the cancer program in collaboration with Southern Research as well as adding more preclinical candidates. For those drugs, Bionetix's primary development site will be the U.S. for the easy access to resources.

"From the business operation perspective, our primary goal is to successfully meet the IPO requirements for [the] KOSDAQ market and through an IPO, we would like to secure enough funding to achieve our technological plans," said Jung.