Low-Cost Repurposing for Breast Cancer

Carlos Ponce (00:07):

Good morning, everyone. Welcome to another episode of Tech Leaders Unplugged, and I'm joined today as ever, by my fellow teammate and, and co-host Wade Erickson. Thank you for being here, as ever. And of course, we're also joined by our guest today, Adam Watson. He is the CEO and co-founder of MeCo Diagnostics. So let's get started. Let's get Unplugged, Adam. So welcome to the show.

Adam Watson (00:39):

Thanks for having me. I'm really excited.

Carlos Ponce (00:41):

Absolutely. It's a pleasure to have you here, Adam. Okay, so let's start with you, Adam. Tell us a little bit about you, your background, and anything you want to say about yourself, and then of course, tell us about MeCo Diagnostics and we'll go from there. Thank you.

Adam Watson (00:55):

Sure. Well as I said, my name's Adam Watson. I have a PhD in cancer biology. In fact, the technology that I'm working on now and building as our lead asset for eco diagnostics is actually the result of my graduate work. So, I've been working on this project for about eight years now, and we're still a couple of years away from commercialization. So I am from Vancouver, Canada originally. I'm Canadian, and it certainly being a Canadian has, I think, you know, colored some of my outlook on healthcare in America. Because as you know, we have a very different healthcare system in Canada with a single-payer system. And over the years, you know, as healthcare costs have risen dramatically for Americans, you know, much more than Canadians, I think it really is, you know, quite imperative for people from all different sort of walks of life you know, to find a way to lower healthcare costs whether that's through sort of research and development or like community health programs or, or, you know, lots of different strategies. And that's really the overarching theme of what I wanted to do with my career was to address healthcare costs. And so, it was an opportunity that was sort of presented to me after I finished grad school to launch a startup. So, we are a University of Arizona spin-out company, and I launched the company with my Ph.D. advisor, who's now my co-founder and chief scientific officer. And we've been working together ever since building our startup, which is now located in San Diego, and incubating at Evo Nexus, which is a highly selective nonprofit incubator and, and accelerator that's located in Sorrento Valley here in San Diego.

Carlos Ponce (02:38):

Great. yeah, you mentioned the University of Arizona, and it definitely rang a bell. I'm an Arizona brat, so, it's like, oh, wow. That's, that's, I, I feel you. Okay. So let's, let's continue with the MeCo Diagnostics. Can you tell us a little bit, more about MeCo Diagnostics?

Adam Watson (02:58):

Yeah, so the name MeCo is actually short for mechanical conditioning. And I know this sounds a little bit complicated. I'll, I'll try to, you know, make it easy to understand, but mechanical conditioning essentially means how cancer cells respond to stiffness. A way to think about mechanical conditioning is, you know, we all remember those child's toys, like a sort of a windup toy. You know, you wind up a toy and then you let it go, and it goes and does something. So, it has this sort of stored, you know, a memory that you put in a mechanical input by turning a crank, and then the, the, the toy will move. So it turns out that's kind of an analogy for how breast cancer cells work. And so what I studied for six years during my PhD was actually just the basic mechanisms by which cancer cells sense the stiffness of their environment and how it changes their behavior. This is actually something that everyone already intuitively knows about cancer, especially breast cancer, is that tumors are stiffer than surrounding tissue. In fact, this is the oldest observation, you know, in cancer in oncology over 2000 years ago, there was a recorded report of a lump in a breast in Queen a Tosa. So really we've known for 2,000 years that cancer is associated with like a stiffening of the tissue. So, we've really started to understand in the last 20 years how that, that change in the stiffness of the tissue, which is why you can, you can feel a lump in the breast how that physical change is actually changing the, the cancer cells behavior. And so, what I published during my Ph.D. showed that this increased tissue stiffness, increased tumor stiffness, causes breast cancer cells to behave very badly. It actually instructs them to spread throughout the body and, and cause a lot of mayhem. And really the worst part of cancer, and really the cause of death for cancer is when it spreads throughout the body. So, what we discovered was really, the stiffening of a tumor can actually drive that process. And so this, this led to this idea, well, if mechanical conditioning, if the cells responding to this, to tumor stiffness is causing them to spread throughout the body, what if we actually reduce the stiffness of cancer cells or sorry, of the tumors that the cancer cells are, are, are, are in. So, we realized that there are actually already drugs out there that can reduce tumor stiffness or tissue stiffness, and they're called anti-fibrotic drugs. And so really, the, the, the, the goal and the founding mission of Micro diagnostics was to repurpose this class of drugs called Antifibrotics that are not actually used for cancer in the US right now and then use them for breast cancer. And there are really a lot of advantages to using, a repurposed drug. These drugs have been used for 20 years in humans. They have, they're oral drugs, they're, they're well tolerated you know, they have low toxicity. And so, it's really a fantastic opportunity especially when you consider that there are now generic versions of these drugs available. So, you know,  the average cost of a new cancer medicine 10 years ago was about $60,000 a year. The average cost of a new cancer medicine today is about $250,000 a year. So clearly, I think it's imperative that we find ways to reduce the cost of cancer treatment, and drug repurposing using generic drugs is really the strategy that we've struck upon to try to make a difference, in lowering healthcare costs. So antifibrotic drugs reduce the stiffness that reduces mechanical conditioning, and MeCo is, is the name of our company, because really that's the phenomenon that we are addressing.

Carlos Ponce (06:40):

Excellent. Thank you so much, Adam. So that, okay, so you told us a little about MeCo, so that obviously led me to the topic of today, which is low-cost drug repurposing for breast cancer. So, we're going to be talking about discussing a solution for the affordability to the affordability crisis in cancer treatment. So let's continue there. Please tell us and the audience why you chose this particular topic and why you felt it was relevant for today's day and age. Let's continue there, please.

Adam Watson (07:12):

Yeah. So unfortunately breast cancer is the most common invasive cancer for American women. It is, it is an epidemic. Over a quarter million new patients every year, both women and men. 1% of breast cancers are, are in men but really over a quarter million new patients every year in the us. And cancer is actually although we are making some strides, you know, in, in treatment and extending survival, people are living longer anyways. And cancer rates for breast cancer are actually increasing. So this creates a really big problem. The number one cancer is actually growing. People are living longer with it, and the drugs we're using to treat it are getting exponentially more expensive. So, we realize that there's a crisis in affordability for cancer care, especially breast cancer. You know, the next time someone tells you that they just heard about, you know, a fantastic new therapy, you know, for cancer, you know, you should stop and think how much it costs and who's paying for it because you might be less excited about this fancy new therapy. It's, it's almost outrageous now, the, the, you know, the price tag on some of these new cancer medicines. And of course, you know, pharma will always find a way to justify in terms of like, you know, years of life saved. But really we're, we're now, you know, pushing you know, $500,000 for, you know, CAR T therapy which is, you know, a fancy new immunotherapy for, for cancer. So it, it really begs the question, you know, how much longer can we really keep going down this road of increasing costs, you know, 20, 30% year over year and more patients getting cancer? I mean, our healthcare system, regardless of, you know, what kind of insurance you have and who's paying for, I think the goal is, is to not argue about who's paying for what and, and what should be covered. The question should be really what are the root costs and can we, can we address those root costs? So, one way that we realized that we could address affordability, I think trying to legislate drug prices is a difficult battle right now, as you've seen in the news, there's the Inflation Reduction Act, and of course, this is getting pushed back from pharma and it's going to reduce innovation because they can't make as much money as they used to. And so really legislating, you know caps on prices is a very difficult thing to do. One way that you can lower prices is by using the free market. And so, by introducing a lower cost-effective therapy for breast cancer, we hope to bring prices down by simply providing a much lower cost option. And then, you know, by the, the principles of the free market some of these really high-cost therapies are going to have to come down in cost, you know, in, in order to, in order to compete. So I think this is really one way we've decided that we actually can make a difference in the long run, and not just for breast cancer patients, but by showing a proof of concept that we can take a generic emergent drug that will soon be quite cheap, and use it for a very large population of cancer patients. We think that this will hopefully inspire other people to take the same approach and to repurpose other drugs, other generic drugs to lower the cost of cancer treatment, and also put downward pressure on some of these new drugs, because quite frankly, it'll, it'll be wildly absurd. If there are, you know, treatments that cost a couple hundred dollars a month, and then treatments that cost $30,000 a month, like clearly that, that price point, which is largely arbitrary of, you know, 20 or 30 grand a year, or sorry, 20 or 30 grand a month, which is what some new cancer treatments cost those prices are largely arbitrary and they can absolutely come down. And they will as a matter of, of competition. So we think that this is really one way that we can help improve affordability and, and reverse this really devastating catastrophic trend of runaway prices in cancer treatment.

Carlos Ponce (11:17):

There you go. Thank you so much again, Adam. Wade, please, back to you.

Wade Erickson (11:22):

Yeah, so, you know, I, I'm intrigued with this concept of this repurposing, you know, doctors all the time, they'll do off-label use of drugs for you know, using a drug that was meant for something else and, and apply it for another condition. So they have, obviously within their medical license freedom to apply drugs in a different way that wasn't really meant for that. And in a sense, what you're doing is you've formed a business to take a drug that was for something else and apply it to something, tell me what you have to do differently as a business that a doctor wouldn't normally be able to do in your application of these… the drug that was meant for Antifa fibroid and use it over here. And then what kinds of testing and other kinds of things do you have to do to bring that to market? When doctors all the time, why not just take that generic and say, yeah, I got a breast cancer patient and I'm just going to use it and don't need to form a business. Right. Tell me the difference with that.

Adam Watson (12:26):

Yeah, that's a great question. And you know, to be honest, when I started doing this research that, that led to where we are I, I had no intention of ever forming a, a business. I'm not a sort of a natural business person. I'm, I'm a scientist. And really it, it, it came about because we saw, we had this really incredible, perhaps once-in-a-lifetime opportunity. So, you're right, we are not, a therapeutic company. We're not a drug development company. We do not own the rights to the drug that we are repurposing. It's currently on patent right now, costs about $12,000 a month, but it loses patent protection and a couple of generics come to market within the next two years. So the cost will dramatically come down. We will not make any money off of the sale of that drug. So really what's, what is our business? Well, what happened was we are not the first people by any means or stretch of the imagination to consider using antifibrotics for breast cancer. In fact, there have been a few clinical studies already done. Now, what happened in those studies is that when you enroll all breast cancer patients and you randomize them to get either antifibrotic therapy or, you know, control therapy, which is, is chemotherapy standard of care, what happened was there wasn't a statistically significant benefit when you used all patients. And so that was a terrible outcome for the study sponsors. It cost millions of dollars for this trial. And the result was, well, we think there's maybe a difference there. It seems that some patients are benefiting, but there isn't a statistically significant benefit. So, by the rules that we've all set up that trial was considered a failure. So when I saw that, I got really excited because what we do is we have a predictive biomarker test. And what that means is we can analyze a patient's tumor. We look at gene expression, in fact, we look at over a thousand different genes, and we come up with a score, and that's what MeCo score is. And it tells us if a patient is likely to respond favorably to antifibrotics. So without a test like ours, antifibrotics can never be deployed in breast cancer patients because the data show that it doesn't work for all patients. And the only way that physicians can, you know, rationally and morally you know, prescribe off-label, which is of course they have the freedom to do so, is if they have evidence that it's going to benefit a given patient. And so, when we saw this, this quote-unquote failed clinical trial that was actually done in Spain at the Spanish National Cancer Research Center, we actually forged a partnership with the government of Spain in order to reanalyze the data. And we basically called our shot, we said, these patients we predict are going to be the ones that benefit, and these ones are the ones that didn't. So we went through that process, and it turns out we were right. We were able to predict which patients benefited. And so now we've essentially resurrected this clinical trial that was considered a failure. It's now a success because we just had to go back and predict which patients were able to benefit. And so now we can deploy, or not we, but physicians are able to confidently deploy antifibrotics after our test comes to market because our test will tell them with high confidence if that patient is going to respond favorably to antifibrotics. So what we've done is instead of monetizing the sale of the drug, we have monetized the selection of patients. One thing that's really interesting about this is that the value of our test is actually inversely proportional to the cost of therapy. And I'll give you an example of this. If you are going to pay, or your insurance company is going to pay a couple of thousand dollars for a test like ours to tell you if you should take a certain kind of therapy. So if you're going to pay $2,000 for tests to tell you if you should take immunotherapy and that immunotherapy is going to be effective, but it's going to cost $200,000 a year or more, or you can spend the same couple thousand dollars to take a test to see if you're a good match for antifibrotic therapy, and antifibrotic therapy is going to be maybe a couple thousand dollars a year. Well, there's actually a lot more incentive to be matched to a therapy that's, that's cheaper. So, it's ironically in our best interest for the drug to be as cheap as possible because then it incentivizes people to take our test if there are matches for the drug, it's going to save them a lot of money because the alternative treatments are so expensive. And so this is something that's really interesting that ironically, we want the drug costs to come down as quick as possible, which is completely opposite from, you know, the business model of pharma, which wants to keep drug prices as high as possible for as long as possible.

Wade Erickson (17:01):

So how do you plan to market this? Will you actually then go to the, the general consumer market and much like they advertise on TV and say, Hey, by the way, if you have, you know, breast cancer, there's this test out there that your doctor might not be telling you about, that will save you a lot. I mean, what's kind of the angle? Obviously, your business is now a test, it's not a drug. And so tell me a little bit about how, how you'll get to the market so that they understand that they actually could save some money. cause I mean, hopefully, the doctors aren't in collusion with the pharma companies that are doing that, but, you know, will people be aware of your test?

Adam Watson (17:43):

Yeah, so it's a, it's a good question. And you know, again, we're, you know, we're a very early-stage startup with six team members. So, you know, the actual roadmap for us as a startup is, you know, likely to lead to acquisition by a larger company that is in the space of clinical genomic services. You know, there's for instance you know, big companies out there that market tests for breast cancer patients to tell them if they're a good match for chemotherapy, if they're a good match for hormone therapy, there's now tests to tell patients if they're a good match for immunotherapy for radiation therapy. So, all the different modalities of therapy that are given to breast cancer patients, which again, they're not mutually exclusive. Many patients get, you know, four different modalities of therapy. We're now realizing that for this to be the most effective and for personalized medicine to truly, you know shine, we do need to have predictive tests for each kind of therapy. So there's already companies that you know, market tests like Oncotype, for instance. That's the leading test for chemotherapy prediction. And our test is something that, you know, can easily fold into that sort of analysis. So really, we hope for the sake of everyone that in the future, you know you shouldn't have to send five pieces of tumor tissue out to five different companies in order to tell you which of those five therapies maybe all or maybe none, you should take really from one piece of tissue. We should be able to tell you if you should take any of the five or six or seven or eight new therapies, you know, they're going to be available. So I think ultimately the way we are going to get to market is, is through, you know a merger or an acquisition with a company that already has, you know, a marketing force already has, you know, a patient funnel already has those connections with, with physicians and the, you know, the brand awareness. Because again, this is not… this is just a new… this will be new additional therapy that will be given to patients. It won't be displacing any therapy. So that'll just be, you know, another extra pill. You take a day, you know, before, before surgery in order to help reduce the tumor that you have so that when the surgeon goes in to remove your tumor, there's very little of it left and it hasn't spread. So essentially we are probably going to partner in order to actually come to market. And sure, there, there might be ads you know, for, for legal reasons, we'll never sell directly to consumers. We, we consumer, by that, I mean, consumers won't be able to come to our website and click a button and order a test and, you know, send in some of their tissue. That's, that's not how it works. They will have to like, you know, most like most drugs, they'll have to then, you know, ask their physician if their physician is not already aware and say, Hey, I heard about this test. Do you think I'm a good fit for it? The physician then makes that decision ultimately if the physician wants to order it, and then we send, the results back to the physician, and the physician again uses that information as part of their, you know, comprehensive overall treatment strategy. So you know, strictly speaking, we're just providing more information to oncologists, to physicians, so to help them make the best treatment strategy for their patients. So, it is a little bit different than like a, you know, a direct-to-consumer model, like, you know, 23 and me that people are familiar with, where, you know, you swab your cheek, you send it in, they send you the results directly. So it's not quite that model. It's, it's more of the, the pharma model where you hear about a test or a drug on in whatever social media or TV, and then you're aware of it, you do some research and then you ask your physician if it's a good fit for you. So that's ultimately how we'll come to market. But most likely it'll happen sort of after a partnership or an acquisition with a bigger company that has this sort of you know, marketing force and the resources in order to handle the sort of scale that we're talking about. Because again, this is the most common cancer in American women. It requires a pretty big scaled-up operation in order to really serve all the patients that we need to serve.

Wade Erickson (21:47):

Great. Great. Wanted to pivot a little bit. A lot of our show watchers of the show are entrepreneurs who have ideas that maybe they want to start a company, and you said this is your first company. Also, I noticed in your background you were a grant reviewer and a lot of folks who start businesses don't understand the grant process and how that can actually provide some financial support to a business in combination with angel investors and other kinds of early, early-stage investments. Can you tell, talk a little bit about some of the lessons you've learned in your first startup here, and then maybe if your grant experience has influenced how you approach this business, and maybe just share a little bit about that, you know, experience and maybe why you use, why use grants versus go seek angels?

Adam Watson (22:41):

Yeah, so it's the answer might be a little bit ironic. So it is true. I, I do, you know, review grants you know, it's, I, I do this you know, for, for Genome Canada. And it, you know, it's a way for, for me to sort of you know, give back. I think that ironically, my experience with grants overall and not reviewing them, but actually writing them and submitting them as a former academic, it really motivated me, to seek out private money. The reason is grants are so competitive that you can have an absolutely fantastic idea, and it can be a flawlessly written grant with a huge unmet need, and there's still a really good chance you won't get that money. And so actually we, you know, my co-founder and who was my PhD advisor, we wrote lots of grants together. And it was a heartbreaking experience because you know, more often than not, we would get, you know, turned down. And that's really the, the only path to you know, to getting, you know, funding as an academic grant. And so that's why we realized, even though neither one of us was inclined to business, we realized, you know what, this is something that really needs to get funded, and we can't just sit around and wait, you know, for, and, and hope that you know, our grants are going to get funded. So it was, that was really the decision you know, an inflection point for us to realize we have to seek a different solution to fundraising rather than just trying the academic route. And so that's really Grant, grant writing you know, it's a, it's a great skill to learn. And, you know, it, it's obviously the, the best mechanism we have in order to judge ideas out there. Unfortunately, the pool of money in, you know, public money for grants is very, very small. And so it's, it's incredibly difficult to fund, you know, really meaningful research, especially clinical research that's quite expensive as, as you can probably imagine because of clinical trial costs, funding this kind of research with grants alone is almost impossible. So that's really my experience with Grants led me to realize, you know, we have to start a company and raise venture funding if we want to really you know, attack this problem quickly and efficiently, you know, in a way that, you know, we can really make a difference in just a few short years rather than, you know, a decade of, of trying to get grants.

Wade Erickson (25:02):

Oh, I think you're on mute,

Carlos Ponce (25:04):

Yes. I'm sorry about that. Yes, I usually put myself on mute to avoid shenanigans. Okay. So we're, we're coming up on time, unfortunately, and the only thing left for me to do right now is of course, thank you for having been with us today on the show. And before we go, let me just make a quick very quick announcement of what's coming this week on Tech Leaders Unplugged. We are going to be speaking on Friday with Kevin Mohan Nair who leads engineering for Authentic in San Francisco called Chipper Cash. So, it's going to be about stable digital currencies in emerging markets. And well, he claims that it's the hottest technology trend. His thought was over. We'll see if it's over or continues for many years to come. That's what we're going to be talking about right here on Tech Leaders Unplugged. So, join us next Friday right here on Techleadersunplugged.com and through our social media channels at 9:30 AM Pacific. And that's all I have for now. Again, thank you, Wade. Of course. Thank you, Adam, for being with us on the show today. Okay, thank you. Stay tuned folks.

Adam Watson (26:21):

Thanks a lot, guys.

Carlos Ponce (26:22):

See you soon. Bye-Bye.