9 THINGS WE LEARNED FROM SILENCE THERAPEUTICS CEO ALI MORTAZAVI

Silence Therapeutics, formed in 1994 and with offices in London and Berlin, specialises in gene expression modulation: a method of either turning on or switching off genes using short sections of RNA, the molecule responsible for translating DNA code into functional proteins. With interest in precision medicine growing, Silence’s ability to design, produce and test RNA-based drugs in a matter of months may at first appear particularly tantalising for investors looking for a quick exit. But as CEO Ali Mortazavi explains, he’s more interested in investors who are willing to commit, and allow this exciting company to become the versatile multi-drug platform he envisions it becoming. Here are some lessons we learned from Ali’s recent interview with our partners at Biotech & Money.

Ali joined Silence in 2012, leading its refinancing and refocusing the business. He has extensive expertise in UK small companies, particularly in biotechnology investment and ventures. Ali has over 17 years’ experience in finance having co-founded Evolution Securities in 2001, heading up the Group’s principal trading division.

1. Gene silencing technology relies heavily on delivery systems

The bioavailability of many small molecule drugs is often high due to their ability to pass through the body’s cells’ hydrophobic lipid membranes. RNA strands, being relatively large and hydrophilic molecules, must be delivered into cells instead, often by encasing them in an artificial lipid ‘cage’ known as a liposome. Furthermore, the medicine must be sent to a specific organ or area of the body for it to work most effectively.

“The term precision medicine is actually used quite widely. You can be quite precise with a drug – for example an antibody – but whilst this is quite specific, you’re not really resolving the underlying issue. You’re mopping up a flood rather than switching off a tap. From our perspective we’re trying to switch off taps. The problem with this is that you have to have delivery systems, and these can be problematic. At the moment the most potent and widely used therapeutic index delivery system by both ourselves and our competitors only targets the liver and hepatocytes. There is no targeted receptor mediated delivery system to any other cell type; no cardiovascular system, no kidney system, no brain system etc. If we could open up other frontiers and cell types, such as the CNS or bone marrow for example, this would be a game changer for precision medicine.”

2. RNA-based medicines are easy to produce quickly and test in vivo

A variety of well-established methods are available for producing nucleic acid polymers – such as short interfering RNA (siRNA) – quickly, efficiently and in large amounts. This is one of the biggest advantages of producing medicines of this nature.

“We can make our drug much faster (than other kinds of therapeutics): we can synthesise siRNA against a target gene within three months and within a cost of around $50,000, and we can generate a drug for in vivo hypothesis testing within four months. Let’s put that in context; a small molecule will usually take four or five years to develop and cost millions of dollars.”

3. There are currently no approved RNA drugs, but things are moving quickly

This field of research is still in relative infancy, but harbours a huge amount of potential. Advances in both communication technology and biomolecular sequencing technologies mean that quick development in this area is perhaps a safer bet than it may initially seem.

“This isn’t a mature industry. From the start to where we are now has been about twelve years. However everything is a lot faster now; in the antibody world they didn’t have concepts like the internet! There are currently no approved short interfering RNA drugs in the world, and I think that it will be a defining moment for this industry when there are. A lot of our competitors are in the clinical with phase 2 and phase 3’s, and we are also in a partner programme with a phase 3 and phase 2.”

4. Investors get itchy feet, but are attracted to this technology’s potential

“It’s actually very hard to run a biotech company – it’s so hard to assess investor sentiment, investors get itchy feet, and access to capital you need can be very large. So the timing element of the stock market is particularly acute for biotech companies. However, investors like our ability to make our drug quickly, and also their specificity. They like the idea of us eventually becoming a biotech company that is risk diversified, i.e. multiple ideas but very few you take forward. What I’ve really tried to impress on investors is we don’t want to be a single product company: we have the ability to pursue many, many preclinical ideas, from which we can choose the very best ones.”

5. Investors are put off by life science’s apparent complexity, despite being comfortable with other ‘complex’ industries

Many generalist investors simply won’t consider life science companies owing to their requirement for specialist knowledge. Ali Mortazavi, however, finds this somewhat perplexing consider how quick they are to invest in other similarly complex industries.

“It’s a strange situation, because there’s no question that drug development is complicated. What with the demand of biology and chemistry, it’s beyond the scope of one individual; really, you need a small team of people to really understand this.
But what I actually find surprising is that exploration for oil or minerals, for example, is also very complicated and difficult, but investors – especially in the UK – seem to be quite comfortable with that complexity. Yet they find medical complexity very difficult, which I find surprising. I actually think it’s the reverse myself!”

6. Silence’s latest raise brought more than just capital, with sights now set on the US

May last year saw Silence therapeutics undertake a highly successful raise, collecting a number of important investors with long term ambitions.

“We did a very important capital raise in May last year, where we got some very big strategic institutions involved. This gave us the balance sheet to have genuine aspirations to be a platform drug development company. The last reported cash was something like £50 million, which is not a gigantic number in biotech terms, but what’s more important is that the quality of investors we got are the types that are as long term as possible; they’re not just in for one raise, but for subsequent development of a business. Their aim is to use Silence, and the RNA vehicle in the UK and Europe, to match the US. This is a major achievement.”

7. Biotech CEOs must be philosophical when it comes to share prices

Being a CEO of a biotech company can be incredibly nervewracking, considering how volatile the industry is and the fluctuating price of your shares. Ali Mortazavi offers some advice to companies climbing the ranks and commercialising their technology.

“I heard an interview from the CEO of Moderna recently which I really resonated with. As a biotech CEO, your emotions reflect the share prices. But you need to bear in mind that biotech share prices are very volatile. You just have to be philosophical on a day to day basis. You can’t just take every bit of data, every bit of IP news seriously.”

8. Silence’s technology has high potential as a multi-drug, low-risk platform

Silence finds itself in the unique position of championing specialist technology yet also being able to provide potential new therapies in a variety of different areas. This multi-drug potential sits well with Ali’s vision for the company.

“I want to be able to create a sensible biotech business; one which isn’t a runaway volatile train. I want to be able to smooth out the effects of successes and failures. I don’t want people to have to go home having had their share prices go down 90%. Instead I’d want to be able to say that despite any setbacks, we still have so many other eggs in our basket. That diversification of risk is a very important business concept. It’s something you only tend to get in the really big pharma companies, but you can get it in a platform company.”

9. Ali’s main desire is to make a stable business, but making a game changing drug is still the dream

“I would love to be able to make game-changing new drugs. Getting a drug approved is by far and away the hardest thing anyone can do. To have that in a real unmet need and bring about a dramatic biological affect would be a dream come true. Take something like Glivec, where patients who were literally at death’s door were given the drug an unproved basis, and then they were living for ten years afterwards. That is the definition of a modern miracle. That would be nice to do.”