A complex skin structure (such as a nipple) can be successfully decellularized under conditions that prevent extracellular matrix crosslinking or undue matrix degradation [1]. This treatment removes cellular antigens, thus mitigating immunorejection concerns and enabling allogeneic transplantation for nipple reconstruction after mastectomy. Non-human primate studies have shown that host-mediated re-vascularization and re-epithelization of the decellularized nipples occurs within six weeks and nipple projection is maintained over the same timeframe [1]. The mechanisms by which a decellularized graft located on the surface of the body heals are incompletely understood, but are likely to follow a similar path to decellularized allografts that are implanted within the body, with some modifications. The following is a description of probable temporal events leading to healing under this circumstance.
MedSurgPI is excited to tell the story of one of our innovative clients...
Keeping the Passion for Improving Patient Health Outcomes Moving Forward!
Esther M Alegria, Chief Executive Officer at APIE Therapeutics
My passion began in 1980 when, as a two-year college graduate, I joined the pharmaceutical industry in the island of Puerto Rico. The sense of contribution to my family, friends and every single user of the drug products we produced was embedded in every cell in my body. There has never been a question about what I should do in life.
This passion gave me the strength to go back to college and pursue a Ph.D. in Chemistry. Did I mention doing this while raising my two children, moving to a new country, and learning to speak English at the same time? Well that story is for another time. After completing my Ph.D. in Chemistry and an NIH Post-Doctoral assignment, I reentered the industry, in a Research and Development capacity. This path took me to Wyeth Vaccine R&D where I became closely involved in the development of Prevnar® and Meningetec® vaccines, from pre-clinical stage to commercialization. The journey, the learnings, and my mentors along the way were awesome and huge contributions to who I am today! I was honored to join each of my four grandchildren at the pediatrician’s office when they got their Prevnar® vaccination (I had to be there and witness it!).
My next big move was joining Biogen where my passion for moving forward new therapies to patients in need continued. In this journey I developed a second passion, seeing others develop their potential in the workforce. The satisfaction of managing and leading others on the right path that illuminates their skills and expertise has been a legacy that I treasure.
TODAY, I am not slowing down but starting the APIE Therapeutics, Inc journey. We have negotiated the exclusive worldwide intellectual property rights to RTI's (Research Triangle Institute International) decades worth of research on the Apelinergic System, Apelin/APJ receptor Agonists compounds portfolio, and pre-clinical studies of Apelin Agonist for the idiopathic pulmonary fibrosis (IPF) and heart failure (HF). APIE-Therapeutics Inc current strategy is to leverage the Apelinergic System Signaling Path to develop a portfolio of Anti-Fibrosis Therapies utilizing the RTI Apelin Agonists compounds portfolio (+800 compounds). The Apelin/APJ receptor is central to the pathophysiology of fibrosis, an underlying hallmark of many serious diseases. Drugs have been proposed for multiple diseases in pulmonary, cardiovascular and metabolic therapeutic areas. We have preclinical data in three specific therapeutic targets but intend to continue expanding the therapeutic targets within the Apelinergic System Signaling Path utilizing the RTI Apelin RTI Apelin Agonists compounds portfolio. The Idiopathic pulmonary fibrosis (IPF) indication is the pipeline program closest to being ready for human clinical trials.
We are excited to be moving this program forward given the strong need for better health outcomes; particularly, given the current pandemic and the observed increase in post-Covid-19 pulmonary fibrosis.
Unfortunately, there are only two available drugs in the market, and both provide limited health outcomes. The life span of IPF patients is 2-5 years. APIE-Therapeutics’ Apelin Agonists compounds novel mechanism of action for the IPF indication, has attracted the attention of top pulmonary/lung experts from Vanderbilt University Medical Center, University of Michigan Medical School and Weill Cornell Medicine, who have agreed to join our Scientific Board of Advisors. I am excited to have them be part of our team. We have a compelling preclinical data package and an experienced team of biopharma experts in pre-clinical and clinical development, regulatory, CMC and commercialization that I am confident will deliver on this program. There is a common motivation among all involved at APIE-T, a strong passion for bringing better health outcome to patients suffering from debilitating and fatal diseases.
We are launching an investor funding round this fall to move the IPF program into human trials. I am confident we will be conducting clinical trials next year!
Plakous Therapeutics extends research through agreement with Mayo Clinic
WINSTON-SALEM, N.C., August 25, 2020– Plakous Therapeutics, Inc. announced that it has signed a know-how license agreement with Mayo Clinic. The multi-year agreement will focus on understanding the results of a natural history study of the factors associated with necrotizing enterocolitis (NEC), a rare disease affecting premature babies. Plakous has received Orphan Drug and Rare Pediatric Disease designations from the Food and Drug Administration (FDA) for the prevention of NEC in premature babies born before 34 weeks of pregnancy. Plakous seeks to prevent NEC with Protego-PD™ by accelerating intestinal maturation of premature infants.
"Through this collaboration with Mayo Clinic, we will improve our understanding of NEC. As a leader in clinical outcomes research, Mayo Clinic is the ideal collaborator to seek the risk factors associated with this rare pediatric disease. We are excited to interface with leading neonatologist, William A. Carey, M.D., and leverage the breadth and depth of his experience with this research,” said Robert Boyce, Chief Executive Officer of Plakous Therapeutics.
“This study will provide valuable insights for the development and design of our clinical trials in NEC. This is a critical step in the advancement of our Investigational New Drug filing for Protego-PD™, an orally delivered acellular biotherapeutic developed by Plakous from postdelivery placentas,” said Boyce.
About Necrotizing Enterocolitis (NEC) NEC is a devastating disease caused by inflammation and lack of development of the intestine. More than 90% of the 6,000 annual cases in the United States occur in very low birth weight babies, babies born weighing less than three pounds. NEC carries a 30% mortality rate. Managing NEC consumes 20% of the $5 billion annual neonatal intensive care unit expenditures plus an estimated $4 billion in hospital costs for subsequent treatments.
About Plakous Therapeutics, Inc. Plakous Therapeutics is a biotherapeutic company dedicated to researching and developing placenta derived regenerative therapies to improve patient outcomes and reduce health care costs. For more information please visit the company’s website at plakoustherapeutics.com.
Orthotopic Grafting of Decellularized Human Nipple: Setting the Stage and Putative Mechanism of Healing
A complex skin structure (such as a nipple) can be successfully decellularized under conditions that prevent extracellular matrix crosslinking or undue matrix degradation (1). This treatment removes cellular antigens, thus mitigating immunorejection concerns and enabling allogeneic transplantation for nipple reconstruction after mastectomy. Non-human primate studies have shown that host-mediated re-vascularization and re-epithelization of the decellularized nipples occurs within six weeks and nipple projection is maintained over the same timeframe (1). The mechanisms by which a decellularized graft located on the surface of the body heals are incompletely understood, but are likely to follow a similar path to decellularized allografts that are implanted within the body, with some modifications. The following is a description of probable temporal events leading to healing under this circumstance.
Nipple Reconstruction
At some relevant timepoint after mastectomy and breast reconstruction, a woman will elect to have nipple reconstruction. After a review of all possible techniques, including tattooing, local flap rotation, autologous full thickness skin grafting from labia, and allogeneic or xenogeneic implants, it becomes clear that all are flawed in some way that prevents the accurate reproduction of a nipple’s 3D structure, pliancy, and color. A proposed new solution is to take advantage of the extensive evidence that a decellularized allogeneic or xenogeneic graft, an acellular extracellular matrix scaffold, can serve as the nidus for a healing event when implanted in a human (2). Although such scaffolds have long been derived from dermis, small intestinal submucosa, bladder and other organs, recent work has shown that deceased human donor nipples can be successfully decellularized and, when implanted on the surface of the body in a non-human primate model, exhibit complete healing within six weeks. Planned clinical studies will bring this technology to humans, where longed for accurate and complete nipple restoration can be evaluated.
When a woman elects nipple reconstruction with a decellularized human nipple, it is anticipated the following sequence of surgical events will occur. First, she will undergo presurgical evaluation to ensure that her reconstructed breast(s) have healed properly and bear no residual inflammation. Prior to surgery, she will be consulted regarding the relative size and placement of her new nipple(s). Markings will be made to denote these dimensions and positions and standard preparations for surgery will be made. Whether under local or general anesthesia, the breast skin will be prepped with an antiseptic, and prophylactic antibiotics will likely be administered. The surgeon will then remove the epithelial layer of the skin in the marked nipple location(s) on the breast(s), exposing the vascularized dermis, below. Punctate bleeding will likely require control by pressure or electrocautery to create a blood-free recipient field. The decellularized nipple(s) and surrounding areola will then be cut to the desired shape and sewn onto the breast(s) with either interrupted or continuous sutures. Wound dressings will be placed to encompass the nipple(s) but not compress the projecting nipple, itself. It is clear from the outset that this form of decellularized scaffold placement on the human body differs from other scaffold implantations in that it faces a vascularized interface only on one side. So, what is the likely pathway to its healing response?
Healing of Intact and Acellular Grafts
There will likely be some similarities to the healing responses of other living and non-living materials that are placed on a de-epithelialized skin base. Comparing this procedure to an autologous skin graft, it is expected that similar inflammatory steps would occur, but a salient difference is that the intact autologous graft contains micro vessels that would attach quickly to host tissue in a process known as inosculation, bringing nearly immediate life (within days) back to the skin that has been harvested (3). While not obviating interface inflammation and its effects (such as hypertrophic scarring in some cases), re-vascularization of autologous tissue such as a skin graft has the net effect of reducing the period of inflammation, since stress cytokines are no longer being sent from the tissue. In the case of an intact allogeneic or xenogeneic skin graft that is applied to de-epithelialized skin, which is common in burn treatment, inosculation will occur in a similar manner, leading to an apparent healing response that is soon truncated as an immune response develops and the graft is sloughed (4). Although this course of treatment does not lead to complete wound healing, the benefits of this application are twofold. First, the skin provides an essential moisture and infection barrier while the patient is stabilized for subsequent autografting. Second, the highly inflammatory immune response signals the underlying tissue to form a rich vascular network known as granulation tissue that serves as an optimal substrate for subsequent autografting (4).
There are many commercial products (Alloderm® from Allergan being one) that are composed of extracellular matrix proteins such as collagen and elastin (and in some cases fibroblasts and epithelium – Apligraf® from Organogenesis) that mimic the matrix component of skin grafts, whether autografts, allografts, or xenografts. By providing a milieu within which a mild immune response can operate, they often lead to the development of granulation tissue, even as they are eventually resorbed, leading to an improvement in subsequent autologous skin grafting. In addition, they have been used in nipple reconstruction to achieve some or all of the desirable features mentioned earlier, though with unpredictable and often disappointing results.
Effect of Decellularization on Healing
The entry into clinical care of the decellularized nipple allograft is therefore not without precedent, but some steps will be required to ensure that healing of such structures can proceed optimally. This begins with the preparation of the tissue itself. It has become clear in work with other decellularized tissues that the processes of decellularization (including in some cases, terminal sterilization) vary widely and can have substantial impact on the healing properties of matrices (5). The decellularization process must be harsh enough to remove cellular antigens, but mild enough to retain the native extracellular matrix structure, which is critical for providing the proper signaling and support structure to ingrowing cells. If decellularization is incomplete such that cellular antigens remain in immunogenic quantities, undesirable inflammation will be exacerbated, which can slow or prevent healing of the graft. But, if the extracellular matrix is damaged or crosslinked (an outcome that is particularly associated with gamma irradiation sterilization) by excessive chemical or mechanical preparation, the graft will also be less serviceable to the healing process.
Badylak points out that all scaffolds are eventually replaced by host tissue, but that depending upon modes of preparation, this can follow one of two pathways (5). When a scaffold is decellularized to retain its native structure, contains no cellular antigens and is not from an overly aged source, it undergoes a controlled, scar-free replacement process known as “Constructive Remodeling.” Conversely, if the decellularization is incomplete, too harsh, or terminal sterilization creates unnatural crosslinking, a highly inflammatory process is instituted, leading to scar tissue formation. This is known as “Deconstructive Remodeling.” Therefore, for a decellularized nipple allograft to have the potential to be replaced in situ and retain its 3D structure, it will be critical that substantial attention be paid to its preparation process after recovery.
Healing of an Externally Placed Acellular Nipple Graft
Now, assuming that such an optimal preparation has been achieved, what are the likely biological responses to a decellularized nipple allograft from the moment of attachment to a woman’s breast? Initially, despite the achievement of gross hemostasis at the interface during surgery, a thin veneer of fibrin is likely to be present beneath the graft. Platelets, attached to the fibrin through their GPIIB-IIIa receptors, will have been stimulated to release an array of cytokines that will recruit neutrophils and macrophages to the scene. As the latter cells enter the area and probe the underlying surface of the graft, they will begin work in three directions. First, they will sense the need to scavenge the fibrin and platelets and will release cathepsins and other lytic peptides. Second, the macrophages will predominantly be of the M1 or pro-inflammatory types and will begin releasing immunomodulating agents to recruit additional macrophages, neutrophils and eventually, fibroblasts. Third, the macrophages will also sense the low oxygen tension at the tissue interface and emit vasculogenic cytokines such as vascular endothelial growth factor (VEGF) and basic fibroblast growth factor (bFGF) (5).
As capillaries begin to proliferate at the undersurface of the graft, and as debris is cleared away, these vessels will begin to probe the graft itself, seeking to attach themselves to the graft by binding to preserved extracellular matrix anchors via integrins on their cellular membranes. Blood flow will eventually contribute endothelial progenitor cells to the site, leading to vascular ingrowth along the oxygen gradient that is present. Vascular pericytes that bear mesenchymal stem cell properties will then, in conjunction with macrophages, govern the early population of the graft and augment the recruitment of fibroblasts. In addition, for a breast mound that remains sensate after reconstruction, there is the potential for axons to enter the graft in parallel with the blood vessels. If the tissue preparation has elicited a very minor inflammatory response at this stage, a macrophage conversion will occur from the pro-inflammatory M1 state to the anti-inflammatory M2 state. The latter macrophages will then begin to release substances such as growth factors that elicit a Th2 (T helper cell) response, which “manages” the rate and spatial deposition of fibroblasts and also controls their production of extracellular matrix proteins, such as collagen, fibronectin, vitronectin and elastin, in amounts and orientations that respect the configuration of the decellularized matrix that they are slowly remodeling through replacement. This process will occur until an emerging vascularized border is present at the edge of the implant.
At this stage, epithelial cells at the border of the graft will have a toehold on the vascularized matrix and can begin to divide and migrate toward the center of the nipple as a function of the accretive vascularization of the implant. The migrating epithelial cells will likely include melanocytes when present. While fibroblast proliferation and volumetric remodeling of the graft itself continues to be governed by M2 macrophages and pericytes, the epithelium will continue to cover the nipple until this is complete. At that point, oxygen tension within the remodeled and now re-vascularized (and potentially re-innervated) nipple becomes normal and macrophages substantially recede, except for a population that will govern final remodeling of the nipple structure, an event that will be augmented by their mechanotransduction receptors as they are exposed to normal orthotopic breast stresses (6). When remodeling has achieved an “equal and opposite” relationship to those breast forces, remodeling will stop and potentially, some sensation will recover. Depending upon the degree of melanocyte participation in the epithelial migration (or, depending upon conversion of epithelial cells to melanocytes), the nipple will exhibit a hue that is reflective of their participation. In some cases, nipple tattooing may be performed to augment hue after remodeling has been complete. If re-innervation does occur, it is likely that the quality of sensation will continue to mature for some time after complete remodeling.
This constitutes a putative mechanism for the engraftment of a decellularized nipple allograft that is likely to follow the principles of engraftment of other foreign, decellularized tissues, albeit in the context of a unique placement on the surface of the human body.
References
1. Graham, D, et al, Abstract P6-14-13: New Approach To Nipple Reconstruction: In Vivo Evaluation Of Acellular Nipple-Areolar Complex Grafts, Cancer Res February 15 2020 (80) (4 Supplement) P6-14-13; DOI:10.1158/1538-7445.SABCS19-P6-14-1
2. Badylak, SF, The Extracellular Matrix as a Biologic Scaffold Material, Biomaterials, 28:25, 3587-3593, 2007.
3. Laschke, MW, et al, Inosculation: connecting the life-sustaining pipelines, Tissue Engineering, Part B: Reviews, 15:4, 455-465, 2009.
4. Yamamoto, T, Skin xenotransplantation: Historical review and clinical potential, Burns, 44:7, 1738-1749, 2018.
5. Badylak, SF,Decellularized Allogeneic and Xenogeneic Tissue as a Bioscaffold for Regenerative Medicine: Factors that Influence the Host Response, Annals of Biomedical Engineering, 42:7, 1517-1527, 2014.
6. Chamberlain, MD, et al, In Vivo Remodelling of Vascularizing Engineered Tissues, Annals of Biomedical Engineering, 43 1189–1200, 2015.
Current Therapeutic Research Special Edition on Medication Adherence
A special edition of Current Therapeutic Research, an Elsevier journal, will be dedicated to Medication Adherence. We have the pleasure of being guest editors of this special edition. If you are interested in being an author of an article for this edition there is an opportunity to rapidly communicate the results of your research, or thoughts, to a diverse, international readership of scientists and clinicians. Current Therapeutic Research is a well-regarded, peer-reviewed, rapid publication Elsevier journal in the field of clinical trials and other developments in drug therapy. CTR has significant reach, with over 15,000 downloads and page views per month via Elsevier’s ScienceDirect and journals platform. Once published, all content will be immediately available and freely accessible online.
If you are interested, I would ask you to submit an original article, review, or commentary. This manuscript should be submitted through our electronic submission system (Editorial Manager). It should adhere to the format guidelines in the Guide for Authors. When you are ready to contribute a manuscript, the Editorial team of Current Therapeutic Research will work with you and provide assistance as you prepare and submit your manuscript. Please don't hesitate to communicate directly with me, gklein@medsurgpi.com , the Managing Editor (Judy Pachella; J.Pachella@elsevier.com); or the Editor-in-Chief (Dr. Phil Walson; pwalson1@aol.com) if you have any questions.
THE COMPOSITE VIRTUAL MEDICAL OFFICER
There is a global shortage of physicians and experienced biopharmaceutical and medtech physicians. [1] High salaries as well as other costs associated with these positions are expensive for small companies and stretch the budget in larger corporations. A physician’s medical expertise may be limited by their training, knowledge, experience, and abilities. An effective company neurologist may not be able to help if you have just licensed a dermatologic product. Many doctors may excel at product development, but not be that astute in medical affairs and assisting the commercial organization. Conversely, they may be very effective in medical affairs, but not as knowledgeable in medical monitoring and pharmacovigilance.
This need has created the Composite Virtual Medical Officer (CVMO), offered exclusively at MedSurgPI. A full time CVMO consists of two or three experienced pharmaceutical physicians, who provide a comprehensive package of services, talents and abilities. One MD serves as the project managing physician, ensuring the additional doctors are kept well-informed of all the activities. They serve as one cohesive unit, working together on your project to provide a comprehensive product, often superior to the abilities of one person. This composite virtual medical officer can be full or part time and there are no interruptions to activities with vacation or sick days. The CVMO provides the luxury of having two or three physicians on your team for the price of one.
Advantages of a CVMO:
Greater depth of knowledge and experience than a single hire
Multiple skills in functionable capacity to be an expert in development, monitoring, medical affairs, interacting with the FDA, and pharmaceutical business executive
Full or part time
Economical
Total coverage for vacation or sick leave
Virtual or in-office meetings
Able to be in two places at once (when necessary)
No overhead costs for office, equipment or paid benefits
Expertise in diverse functions and therapeutic specialties
Greater flexibility with multiple options for the following:
+Permanent position
+Immediate interim function while searching for a full-time medical officer
+Changing your lead CVMO as the functional role changes
[1] Degen et al. Human Resources for Health (2015) 13:74
MAINTAINING PRODUCT DEVELOPMENT MOMENTUM IN A CHALLENGING TIME
It is important that biotech and device companies continue their critical research and development during these chaotic times. Many small companies are having difficulty raising funds and may be getting short of cash. Consulting companies have the flexibility to work remotely with these companies and can consider delayed payments, use of equity, or other innovative means to compensate them for their assistance while keeping momentum strong and morale high. MedSurgPI, LLC fulfills this role by providing virtual medical support for product development, medical monitoring, medical affairs, and serving as Chief Medical Officers. Should you require these services, please contact us at the following:
Drugs, Devices and Biologicals: gklein@medsurgpi.com
Medical Monitoring and DSMB activity: rmorgan@medsurgpi.com
Find us at: www.medsurgpi.com
MedSurgPI, LLC provides remote Medical Officer and Commercial Chief Medical Officer Services during this critical time of the Covid-19 Outbreak.
Social distancing during the Covid-19 crisis is adversely affecting the ability of companies to continue biomedical product development and to plan and execute clinical trials and medical affairs activities. While this crisis will eventually abate (albeit with an uncertain timeline) virtually located professionals are needed in the interim to continue to support these critical development activities. Research Triangle Park, NC-based MedsurgPI, LLC offers 20+ experienced Physician Associates from all areas of Medicine to provide comprehensive remote medical officer and medical monitoring services to companies worldwide. These services also include strategic product development oversight, clinical trial planning, Contract Research Organization sourcing and management, Medical Communications, interim management, support for fundraising, Key Opinion Leader recruitment and facilitation and medically relevant corporate representation. Should your organization require these skills on a remote basis in the near future, please contact MedsurgPI, LLC and we will respond immediately to support you.
Gerald L. Klein, MD, Principal MedSurgPI
www.medsurgpi.com
gklein@medsurgpi.com
Australian R&D Tax Incentive
How The Australian Research and Development (R&D) Tax Incentive Works
Peter C. Johnson, MD and Gerald L. Klein, MD
Principals, MedSurgPI, LLC
Introduction
In order to foster greater corporate R&D investment to spur jobs and innovation, the Australian government adopted the R&D Tax Incentive system in 2011. While its stipulations have gradually changed over the years, it remains a generous incentive for companies large and small to invest in R&D in Australia. The plan has two broad elements, one aimed at supporting companies having less than 20 million in annual revenue (these are Australian dollars, equivalent to 13.4 million US dollars) and those having greater than 20 million in revenue. The incentive applies not only to native Australian companies but also to foreign companies that establish a bona fide Australian presence and comply with Australian business guidelines as set by the Australian Securities and Investments Commission (ASIC: https://www.investopedia.com/terms/a/australian-securities-and-investments-commission-asic.asp). A straightforward set of FAQs regarding these requirements can be seen here: http://cosec.com.au/frequently-asked-questions/faqs-on-australian-companies/. Additionally, types of R&D activities that are eligible for the benefit are carefully defined in order to prevent abuse of the system. These and current applications of the Incentive are outlined below:
R&D Expenditure Threshold
For all companies, the threshold R&D spending amount to which the Incentive applies is now 150M Australian dollars (100.5 million US dollars).
Companies Having Less Than 20 Million in Revenue
Such companies are entitled to a refundable tax credit equal to their corporate tax rate percentage plus 13.5 basis points. Given that the present corporate tax rate is 27.5%, their refundable tax credit as of the 2019 legislation is 41% of their R&D spend. The word “refundable” requires some explanation. For companies whose revenues impart no tax burden, they are entitled to a cash rebate of 41% of their R&D spend. If they have a tax burden, the 41% will initially be used to offset that amount of tax burden up to and including 41% of their R&D spend. If their tax burden does not achieve this level, the refundable incentive will first be used to offset their tax burden and the remainder distributed to the company as a cash rebate.
The Incentive also distinguishes between expenditures for clinical trials and for R&D that is not specifically a clinical trial expenditure (such as preclinical studies). There is a 4 million Australian dollar (2.68 million US dollar) cap on the latter activities but no limit on the Incentive as applied to clinical trial activities up to the R&D Expenditure Threshold of 150 million Australian dollars.
Some examples are shown in as follows, applicable only to companies having less than 20 million Australian dollars in revenue.
Example 1: Acme Medical spent zero dollars on Clinical R&D and six million dollars on Non-Clinical R&D. Its tax burden was zero so its tax offset is zero and it receives a cash rebate of four million dollars.*
Example 2: RNA Science spent one hundred million dollars on Clinical R&D and zero dollars on Non-Clinical R&D. Its tax burden was zero so its tax offset is zero and it receives a cash rebate of forty one million dollars.
Example 3: Mitochondrial Solutions spent zero dollars on Clinical R&D and ten million dollars on Non-Clinical R&D. Its tax burden was four million so its tax offset is four million and it receives a cash rebate of zero dollars.*
Example 4: Atlas Diagnostics spent fifty million dollars on Clinical R&D and six million dollars on Non-Clinical R&D. Its tax burden was two million so its tax offset is two million and it receives a cash rebate of 19.7 million dollars.**
*Only the first 4M of any R&D tax offset for non-clinical trial related activities can be applied each year. Any remainder must be carried forward as a non-refundable tax offset (see below) that can be applied in future years. This limit does not apply to clinical trial activities.
*In this instance, non-clinical R&D spend refund, capped at 4M is partially applied (2M) to offset the 2M tax burden, leaving 50-2=48*.41=19.7M available as a cash rebate.
Companies Having Greater Than 20 Million in Revenue
Circumstances of application of the Incentive are quite different for larger companies. Companies having greater than 20 million in revenue are entitled to a non-refundable tax incentive equal to their corporate tax rate PLUS a sliding scale premium based on the level of intensity of their R&D expenditure. “Non-refundable” in this instance means that the Incentive rebate only applies to offsetting the company’s tax burden with no cash rebate. However, if the calculated tax incentive amount exceeds that of its annual tax burden, the residual amount can be carried forward as an applicable tax credit for future years.
The sliding scale R&D “intensity premium” (that is, above and beyond their corporate tax rate) is calculated as a function of the percent of a company’s total expenses that are represented by R&D expenses. For an R&D Intensity Range (that is, R&D expense as a percentage of total expenses) that is less than or equal to 4, the Incentive Premium (% of Total Expense) is 4.5. When the R&D Intensity Range is greater than 4 but less than or equal to nine, the Incentive Premium rises to 8.5%. Finally, when the R&D Intensity Range is greater than nine, the Incentive Premium rises to 12.5%.
The following provides some examples of how the program applies to entities having greater than 20 million in annual revenue. Note that corporations having greater than 50 million in annual revenue are subjected to a 30% corporate tax rate.
Example 1: Claro Science’s R&D expense is 1 million versus total expense of 40 million. It has 45 million in revenue. Its applicable corporate tax rate is 27.5%. Its tax burden is 12.4 million and its R&D expense as a percent of total expense is 2.5. Its Incentive Premium (% of total expenses) is 4.5. Its earned incentive tax offset is 18 million. Therefore, this year its incentive tax offset is 12.4 million and it is able to carry forward 5.6 million in incentive tax offset for future years.
Example 2: Adams Medical’s R&D expense is 3 million versus total expense of 50 million. It has 60 million in revenue. Its applicable corporate tax rate is 30%. Its tax burden is 18 million and its R&D expense as a percent of total expense is 6. Its Incentive Premium (% of total expenses) is calculated as 4.5(4)+8.5(2). Its earned incentive tax offset is 35 million. Therefore, this year its incentive tax offset is 18 million and it is able to carry forward 17 million in incentive tax offset for future years.
Example 3: Hong Kong System’s R&D expense is 9 million versus total expense of 135 million. It has 150 million in revenue. Its applicable corporate tax rate is 30%. Its tax burden is 45 million and its R&D expense as a percent of total expense is 6.7. Its Incentive Premium (% of total expenses) is calculated as 4.5(4)+8.5(2.7). Its earned incentive tax offset is 40.3 million. Therefore, this year its incentive tax offset is 40.3 million and it is able to carry forward zero dollars in incentive tax offset for future years.
Example 4: Pacific Bio’s R&D expense is 50 million versus total expense of 450 million. It has 500 million in revenue. Its applicable corporate tax rate is 30%. Its tax burden is 150 million and its R&D expense as a percent of total expense is 11.1. Its Incentive Premium (% of total expenses) is calculated as 4.5(4)+8.5(5)+12.5(2.1). Its earned incentive tax offset is 86.8 million. Therefore, this year its incentive tax offset is 86.8 million and it is able to carry forward zero dollars in incentive tax offset for future years.
*R&D Expenditure Threshold capped at 150M. See above. Also, the scale applies incrementally – that is R&D expenditure up to 4% is rewarded by a 4.5% inventive premium, that portion of R&D expenditure between 4% and up to 9% is rewarded by an 8.5% incentive premium and that portion of R&D expenditures > 9% of total expenses is rewarded by a 12.5% incentive premium.
In Country Guidance
Support for companies seeking these benefits – especially foreign entities with an Australian presence – can be assisted through the complexities of compliance and application by local consultancies having expertise in these areas. A Google search entitled “Australian firms providing R&D tax incentive support” provides a starting point for the identification of such groups: https://search.yahoo.com/search?fr=mcafee&type=E211US667G0&p=Australian+firms+providing+R%26D+tax+incentive+support. Australian Contract Research Organizations are also adept at guiding clients to such support organizations.
Overall, the Incentive is jointly administered by Innovation and Science Australia (ISA) and the Australian Taxation Office (ATO), the former responsible for registering R&D activities while the latter manages the rules regarding who is eligible and overseeing acceptable costs. Background information and guidance regarding eligibility and application to the program can be found here: https://www.business.gov.au/grants-and-programs/research-and-development-tax-incentive
The revised legislation governing the program as introduced into the Australian Parliament in 2019 can be found here: Treasury Laws Amendment (Research and Development Tax Incentive) Bill 2019.
MedSurgPI Partnership Announcement
MEDSURGPI PARTNERSHIP ANNOUNCEMENT WITH DEVICIA FOR EU DEVICE EXPERTISE
MedSurgPI is expanding our services through our unique partnerships with experienced, dedicated, entrepreneurial consulting companies. In light of the current significant regulatory changes in the EU, increasing our regulatory and clinical expertise in Europe is essential. For that reason, we are proud to announce our new relationship with Sweden-based Devicia, a full-service medical device exclusive CRO. As members of Technical Committees and nominated as experts in international working groups writing medical device standards (such as ISO 14155), we will be able to provide our clients with an industry perspective and first-hand expert advice.
Through this collaboration, MedSurgPI will provide:
· MDR & IVDR transit and compliance
Devicia has extensive knowledge of regulatory changes currently taking place in the EU with the implementation of medical device regulation (MDR) and in-vitro diagnostic device regulation (IVDR). Through the collaboration, MedSurgPI and Devicia can assist with regulatory strategy & gap analysis, technical files and design dossiers, classifications, regulatory submissions etc.
· Clinical Evaluations
A key component in getting or maintaining a CE mark is the Clinical Evaluation Report. All medical devices on the EU market must perform a Clinical Evaluation according to MEDDEV 2.7/1 Rev 4. Devicia’s experienced medical writing team performs clinical evaluations according to the current guidelines and fulfils the requirements of the role of a clinical evaluator.
· EU Device Clinical Investigation
Devicia provides full-service support for all kinds of clinical investigations (single center, multicenter multinational RCT’s, registries etc.) both before and after CE mark. Devicia also supports clients with the new MDR requirements for Post Market Clinical Follow up (PMCF). Devicia is nominated as a Swedish expert in the ISO/Technical Committee 194 Working Group 4 governing clinical investigations of medical devices in humans.
· Licenses for ISO 14155 Clinical QMS
ISO 14155:2011 is specifically tailored to the requirements for medical device clinical investigations. Through the collaboration, MedSurgPI can offer access through licenses to SOP’s, templates and forms to be able to conduct a clinical investigation according to ISO 14155:2011.
gklein@medsurgpi.com / 919-930-9180
The Coming of Age of the Antimicrobial Post-Op Dressing?
Authors: Gerald L. Klein, MD & Peter C. Johnson, MD
Post-operative home care has become more important than ever. The use of an antimicrobial dressing in this setting is often essential to an uncomplicated recovery. Previously, tape and gauze may have sufficed for most incisions and antimicrobial dressings were reserved for those incisions at the highest risk of infection. However, the earlier discharge of surgical patients puts them at increased risk of acquiring a post-op surgical infection, which is most likely to occur 24-48 hours after surgery. Increasingly, proper home management of wounds is critical to prevent infections.
As patients become more responsible for their wound care and adherence to follow up instructions becomes more critical, the following questions pertain: “What best post-operative practices reduce the risk of an infection?” Furthermore, what options exist that empower the patient to be a good partner in their post-op care and recovery?
Dressing Features That Enable the Patient: Non-Invasive, Observational Wound Management
Educated patients with the resources to follow their discharge instructions are more likely to experience a positive outcome than those without. Once home, the onus is on them to manage the care of their own surgery site. So, what should the dressing provide to help them be a good partner in their care?
· The dressing should contain an appropriate concentration of a broad-spectrum antimicrobial to prevent microbial growth at the patient-dressing interface.
· The dressing should be thin and be attached with an adhesive that can withstand at least a week of wear time without being irritating.
This obviates the need for dressing changes, saves time, cost, decreases skin irritation and reduces the potential for the new introduction of microbes.
· The filmic portion of the dressing should allow for gas transfer without allowing microbial or fluid entry.
· The dressing adhesive and film should be sufficiently pliant to conform to irregular wound shapes to form a seal with the skin.
· The dressing should be transparent to enable both patient and physician to observe the incision for signs of inflammation and/or drainage.
If these criteria are met, the patient is provided with convenient and comfortable post-operative wound care. Moreover, the ability to readily observe the status of the wound makes the patient a better partner to the physician in the early post-operative period when the potential for Surgical Site Infection is at its highest.
Commonly used antimicrobial dressings typically include one of the following:
· PHMB (Polyhexanide)
· Silver
· CHG (Chlorhexidine gluconate)
· Silver + CHG
Lack of Guidelines to Prevent Surgical Site Infections (SSIs)
It is unfortunate that the current guidelines do not yet recommend antibiotic dressings but state that the issue is unresolved. The earlier surgical hospital discharge should help necessitate this change.
Current Guidelines
Guideline & Conclusion
1. CDC Guideline for Prevention of SSI, 2017 No recommendation/unresolved issue
2. WHO Global Guidelines on the Prevention of SSI, 2016 Conditional recommendation
3. American College of Surgeons and Surgical Infection Society Guidelines for Prevention and Treatment of SSI, 2016 No recommendations regarding choice of post-operative dressings.
4. Society for Healthcare Epidemiology of America/Infectious Disease Society of America: Strategies to Prevent Surgical Site Infection in Acute Care Hospitals: 2014 Update Post-operative wound dressings not addressed
References:
1. CDC Guideline for Prevention of SSI, 2017. https://jamanetwork.com/journals/jamasurgery/fullarticle/2623725
2. WHO Global Guidelines on the Prevention of SSI, 2016. http://apps.who.int/iris/bitstream/handle/10665/250680/9789241549882-eng.pdf;jsessionid=9AAB8F406232C1294A363043D58CAF6F?sequence=1
3. American College of Surgeons and Surgical Infection Society Guidelines for Prevention and Treatment of SSI, 2016 https://www.journalacs.org/article/S1072-7515(16)31563-0/fulltext
4. Society for Healthcare Epidemiology of America/Infectious Disease Society of America: Strategies to Prevent Surgical Site Infections in Acute Care Hospitals: 2014 Update
https://www.jstor.org/stable/10.1086/676022
One such post-operative wound dressing that fulfills these requirements is Eloquest’s ReliaTect™.
A phase 1 clinical trial of the sigma-2 receptor complex allosteric antagonist CT1812, a novel therapeutic candidate for Alzheimer’s disease
Alzheimer’s & Dementia: Translational Research & Clinical Interventions 5 (2019) 20-26
Michael Grundmana, Roger Morgan, Jason D. Lickliter, Lon S. Schneider, Steven DeKosky, Nicholas J. Izzo, Robert Guttendorf, Michelle Higgin, Julie Pribyl, Kelsie Mozzoni, Hank Safferstein, Susan M. Catalanog
We would like to congratulate Roger Morgan, MD; for being a co-author on this new publication
Roger is the VP of Medical Affairs at MedSurgPI LLC. MedSurgPI is a medical consulting group specializing in strategy for product development, medical affairs, medical monitoring, and fractional medical officer services. For additional information about MedSurgPI services contact gklein@medsurgpi.com
Abstract:
Background: Elayta (CT1812) is a novel allosteric antagonist of the sigma-2 receptor complex that prevents and displaces binding of Ab oligomers to neurons. By stopping a key initiating event in Alzheimer’s disease, this first-in–class drug candidate mitigates downstream synaptotoxicity and restores cognitive function in aged transgenic mouse models of Alzheimer’s disease.
Methods: A phase 1, two-part single and multiple ascending dose study was conducted in 7 and 4 cohorts of healthy human subjects, respectively. In part A, healthy, young subjects (,65 years old) received CT1812 doses ranging from 10 to 1120 mg (6:2 active to placebo [A:P] per cohort). In part B, subjects were administered 280, 560, and 840 mg once daily for 14 days (8:2 A:P per cohort). An elderly cohort, aged 65-75 years, was dosed at 560 mg once daily for 14 days (7:2 A:P). Serum concentrations of CT1812 in part B were measured on day 3 and 14 and cerebrospinal fluid concentrations on day 7 or 9. Cognitive testing was performed in the healthy elderly cohort at baseline and at day 14 of treatment.
Results: Treatment with CT1812 was well tolerated in all cohorts. Adverse events were mild to moderate in severity and included headache and GI tract symptoms. Plasma concentrations of drug were dose proportional across two orders of magnitude with minimal accumulation over 14 days. Cognitive scores in the healthy elderly cohort were similar before and after treatment.
Conclusions: CT1812 was well tolerated with single dose administration up to 1120 mg and with multiple dose administration up to 840 mg and 560 mg in healthy young and healthy elderly subjects, respectively. CT1812 is currently being studied in early phase 2 trials in patients with Alzheimer’s disease. 2018 The Authors. Published by Elsevier Inc. on behalf of the Alzheimer’s Association. This is an open access article under the CC BY-NC-ND license: http://creativecommons.org/licenses/by-nc-nd/ 4.0/
Neglecting Regulations and Quality System Requirements is Detrimental to your Business
Mark E. Ramser, VP Quality Management, MedSurgPI, LLC; Peter C. Johnson, MD, Principal, MedSurgPI, LLC; Gerald L. Klein, MD, Principal, MedSurgPI, LLC
It’s never too early to start designing and implementing a company’s quality management system (QMS). Initiating the R&D process is not a problem for companies that have a well-defined QMS and a mature understanding of how it should operate. However, without a well-defined, compliant and effective system, this could be the start of potential future quality and regulatory nightmares. Even with a well-defined system in place, significant problems can occur if the organization is lacking the maturity and experience to utilize it properly. Typically, the R&D function is where most people think a product starts. The founders may not have any understanding of regulatory or quality system requirements. They can simply be focused on developing and launching a product, choosing to worry about the regulatory and quality system requirements once they have a product to sell. Unfortunately, by waiting until the product is ready for market, it will be too late. The ISO 13485 standard, 21 CFR Part 820 (FDA Regulations) and MDR (European Medical Device Regulations) require and expect the product development and launch to be performed under controlled processes and systems. Refer to the following links for the above referenced standards and regulations:
ISO 13485 (Quality Management System for Medical Devices)
21 CFR Part 820 (FDA Medical Device Regulations)
MDR (European Medical Device Regulation)
The notified bodies and regulators expect the following areas to be controlled and managed per their documented standards and regulations:
The most critical in early stage product development are:
Documented Quality Management System
Design Controls (Design History File sub-bullets to prove all these areas are addressed)
Design and Development Planning
Design Inputs
Design Outputs
Design Reviews
Design Verification and Validation
Change Management (design, system, process, supplier, raw material, etc.)
Process and Production Control
Process
Equipment
Supplier Selection and Control
Many of these activities need to be initiated from the start of the R&D process and the establishment of a Quality Policy and Quality Process at the proper time falls squarely upon the CEO. Companies cannot generally recreate documentation history at later dates in preparation for an FDA or regulatory body audit. The company is then open to all the risks related to not having required systems during product development. The risks can vary based on the severity of the issue and can range from:
A Form 483 may be issued to the firm. Form 483 is the communications method used by the FDA to inform the company’s management of objectionable conditions. This should be followed up with a thorough investigation, root cause analysis and corrective action within 15 days. These are available to the public, but only when specifically requested.
Severe issues on Form 483 or a significant number of issues on Form 483 could result in the issuance of a Warning Letter. A Warning Letter is one of the FDA’s principal means of achieving prompt voluntary compliance with the Act. The warning letters are much more significant than a Form 483 and are publicly posted on the FDA website and are easily searchable. This must be followed up with a thorough investigation, root cause analysis and corrective action within 15 days.
Additional actions can result in a consent decree, product seizure and up to and including criminal prosecution against the firm and individuals, with a special focus on the CEO. A consent decree may be viewed as the equivalent to a court order under which the manufacturing and distribution of products can only resume, with conditions closely monitored by FDA.
The regulations defined in 21 CFR Part 820 are legal requirements and carry the stiff penalties noted above. This carries much more significance than merely an ISO standard that defines the requirements without having any legal recourse. One must keep this in mind from the earliest possible point of the inception of the company and not just during the product launch. Not following QMS at product inception and all along the development cycle can have dire consequences for the company.
The timing of onset and the complexity of any company’s QMS is dependent upon the risk that a product may represent when used with humans. Therefore, judgment and expertise are required to properly craft and institute such systems. MedSurgPI can assist your company at the earliest stages to institute a QMS, perform Gap Assessment and Corrective Actions for an existing QMS and assist with the ongoing management of a QMS. Please contact MRamser@medsurgpi.com for additional information.
Peter Johnson, MD to serve as a panelist at AIMBE
On Feb 11, 2019, Peter Johnson, MD will serve as a panelist at the American Institute for Medical and Biological Engineering (AIMBE) taking place at the U.S. Patent and Trademark Office in Alexandria, VA.
MedSurgPI Leadership Presents at the University of Massachusetts Innovation Center
MedSurgPI’s leadership presented at the University of Mass, Massachusetts Medical Device Development Center (M2D2) on Thursday, September 13, 2018. Dr. Gerald Klein spoke on The Continuum of Medical Affairs in a Technology Company Including AI and Blockchain.
$78 million invested as Innovation Works celebrates 20 years
Aethon turned a couple hundred thousand dollars into an international robotics company with delivery robots in hospitals and hotels.
TissueInformatics used a six-figure grant to build a ground-breaking tissue engineering company that raised more than $25 million before a top biotech company bought it.
Both Pittsburgh-area companies were among the first to receive funding from Innovation Works decades ago. And both said that the initial investment led to millions more.
“Without Innovation Works, we probably would not have gotten started as a company,” said Aldo Zini, CEO of Aethon. “It wasn’t just the money, but they also opened some doors for us in order to raise more.”
Innovation Works has been providing early-stage investment to young Pittsburgh startup companies for 20 years. The organization celebrated its anniversary last week by recognizing the achievements of the companies it has helped start and fund.
In its 20 years, Innovation Works, now based in the North Side’s Nova Place, has worked with more than 1,000 companies. Nearly 300 were formed with direct assistance from the organization, and 376 companies received investments totaling $78 million. The companies went on to raise an additional $2.1 billion.
Innovation Works claimed it has created or retained nearly 12,000 jobs, nearly two-thirds of which don’t require an advanced degree. More than half of the companies have a woman founder; 72 percent of the founders came from local universities, and 86 percent of the companies work source from vendors in Pittsburgh, according to information complied by Innovation Works.
“I’m proud of the companies and the entrepreneurs. We have a saying here that we succeed when they succeed. At the end of the day, it’s not about us,” said Rich Lunak, president and CEO of Innovation Works, where he has worked since 2005. “We all take a lot of pride in that.”
The organization calculated that $3.60 was returned to the state economy for every $1 of state money invested. The company receives $3.5 million a year in state money.
Zini said there was a lot of skepticism over robotics companies in the early 2000s, when Aethon was just getting its start. The dot-com bubble had just burst and some investments in robotics in the 1990s didn’t pan out, leaving investors shy.
“Innovation Works, they stepped up,” Zini said.
The organization invested a few hundred thousand in Aethon over a two rounds of investing starting in 2002. Since, Aethon raised more than $50 million. ST Engineering bought Aethon in 2017. The Singapore firm kept the company in the Pittsburgh-area and allowed it to grow.
Aethon has added 18 people to its team over the last 10 months and plans to add another 10, Zini said. The company is moving into a larger building. It has robots in China, Turkey, Singapore, Australia and all over Europe.
But Zini hasn’t forgotten who helped the company at the beginning. He’ll talk to the staff at Innovation Works whenever he is looking for new hires or advice.
“And they’re still helpful,” Zini said.
When four doctors and scientists at University of Pittsburgh spun TissueInformatics in 1997, the startup scene in Pittsburgh was shaky. The city, and its reputation, was still recovering from the collapse of the steel industry, said Dr. Peter Johnson, who came to Pitt in 1987 to train as a plastic surgeon and was one of the three founders of TissueInformatics, which used machine vision to identify pathology slides.
Johnson said building a biotech company in Pittsburgh was rare at that time.
“They took a leap as one of the first to say this was a sector that we really need to invest in,” Johnson said.
TissueInformatics went on to raise $25 million over five years. In 2004, Paradigm Genetics, a North Carolina company, bought the startup. Johnson moved to the Raleigh area where he still lives. He recently bought a 40-acre farm, grows barley and plans to open a distillery.
Innovation Works invited Johnson back to Pittsburgh two years ago to speak. He was impressed the growth of the tech scene. And he expects Innovation Works to keep it growing by finding undiscovered technologies and taking chances, just like it did years ago.
“They’re going to figure out where the fringe is,” Johnson said.
Aaron Aupperlee is a Tribune-Review staff writer. You can contact Aaron at 412-336-8448, aaupperlee@tribweb.com or via Twitter @tinynotebook
UMASS Lowell M2D2 / Advancing Med Device & Biotech Innovations
Thursday, September 13, 2018
DESCRIPTION
Created especially for healthcare startups and medtech innovators: A half-day workshop packed with authoritative insights on leading-edge technologies, new best practices, business intelligence, and networking opportunities (with continental breakfast and light lunch included).
7:30-8:00 Coffee w/continental breakfast
8:00-8:15 Welcome & Introductions
8:15-9:15 Blockchain & Artificial Intelligence – Real World Healthcare Applications
Speakers: Kris Srinivasan, CEO, Life Sciences, Alpha MD & Edward Bukstel, CEO, Clinical Blockchain
9:15-9:45 Blockchain: What Startups need to succeed; What larger corporations like J&J can do to support their growth
Speaker: Kate Merton, Head of JLABS NYC & Boston — J&J Innovation
9:45-10:15 Healthcare Industry Update
Speaker: Ibraheem Badejo, Senior Director, New Ventures, J&J Innovation
10:15-10:30 Break
10:30-11:00 Continuum of Medical Affairs in a Startup Company
Speakers: Dr. Peter Johnson & Dr. Gerald Klein, Co-Principals, MedSurgPl, LLC
11:00-11:30 Friction Points in Health Communications at Point of Care
Speaker: Richard Nordstrom, CEO, Liberate Ideas, Inc.
11:30-12:00 Lunch Break
12:00-12:45 Mock interview with Investors: One or more investors with successfully financed entrepreneur and startup pitch. How to deal with Investors.
Speakers: Steven Schwartz, Robert Bausmith
12:45-1:00 Ice Cream Hour: One-on-one interactive meetings with the speakers and the management of JLabs while you enjoy ice-cream during Q&A.
You are welcome to send in your questions in advance via email to Kris@AlphaMD.com or ask during Ice Cream Hour. You will also be able to talk in person with Kate Merton, Head of JLABS NYC & Boston, and Dr. Ibraheem Badejo, Senior Director, New Ventures, J&J Innovation.
Gordon Research Conference / Musculoskeletal Biology and Bioengineering
MedSurgPI's, Dr. Peter Johnson will chair this conference which will take place August 5-10, 2018 in Andover, NH. Click here to link directly to the conference site.
MedSurgPI: Physician Functional Service Provider
GERALD L. KLEIN, MD; PETER C. JOHNSON, MD; ROGER MORGAN, MD
MedSurgPI is the preeminent Physician Functional Service Provider. We provide medical strategy, medical monitoring, medical affairs, and medical writing from our experienced physician team of seasoned executives. Our goal is to provide this outsourced service to increase efficiencies and decrease cost for drug, device, diagnostic, and nutritional development services.
MedSurgPI doctors are flexible and can provide short term assistance or long term collaboration.
Whether you want a medical strategy, clinical trial guidance, medical monitor or an interim Chief Medical Officer, contact MedSurgPI, LLC at: info@medsurgpi.com.
James D. Hundley, M.D. of MedSurgPI co-authors book: My Hip Hurts!
James D. Hundley, M.D., Physician Associate with MedSurgPI, LLC has co-authored a book My Hip Hurts!: Causes and Treatment of Hip Pain in Seniors. Authors Dr. Hundley and Richard J. Nasca, M.D. are two orthopaedic surgeons with over 100 combined years of training and experience. This is an exciting book as Drs. Hundley and Nasca describe conditions of the hip suffered by older people, what can be done for them, and what they would recommend. Simple drawings and x-rays are used for illustration along with a glossary to help understand medical terms.
This book is available through Amazon at the following link: My Hip Hurts!: Causes and Treatment of Hip Pain in Seniors