Hartford Business Journal

www.HartfordBusiness.com August 15, 2016 • Hartford Business Journal 13 Kolltan Pharmaceuticals and other Connecticut-borne bio- pharmas continue to attract capi- tal and talent, and develop R&D and commercialization partner- ships, Scheer sees the state's bioscience industry generating a sustainable momentum. "They will attract more inves- tors, more entrepreneurs, more innovators, more technology,'' he said. "The next five years will be extremely important in our state.'' So, too, will the period be for the future of Achillion. With its Janssen partnership firmly in hand, Achillion's staff of scien- tists and other researchers are working on what they hope to be a game-changing batch of com- pounds capable of enhancing the body's complement portion of its immune system. In general terms, the human complement system consists of multiple varieties of complement proteins that, when they detect a virus or bacteria, trigger the body's complement system to sweep out the invaders. Indeed, the company's name derives from Scheer and his fel- low co-founders' vision of discov- ering and developing antibiotics for infectious diseases. Their strategy, he said, was to find the "Achilles heel" or the source of vulnerability that would mini- mize the ability of microorgan- isms such as bacteria and viruses to devel- op resistance and escape the effects of treatment. Achillion research- ers already have iden- tified several small- molecule compounds that show early potential as comple- ment-immune sys- tem allies, said CEO Deshpande. Small- molecule compounds are more easily packaged into pill form for ingestion by patients; by contrast, large-molecule compounds are usually administered orally or intravenously. For instance, Achillion has synthesized more than 1,600 molecules to try to home in on the ones that can be safely inject- ed into the eye's retina to treat a debilitating ailment known as dry age-related macular degenera- tion, Deshpande said. Untreated, it can cause blindness. Another Achillion treatment in development would combat the same ailment targeted by Alexion's eculizumab — branded Soliris — a complement-associ- ated protease inhibitor to treat pararoxysmal nocturnal hemo- globinuria (PNH), which causes the complement system to run amok, destroying red blood cells. As a blockbuster drug, Soliris has staked Alexion to hundreds of millions in sales and a $31 bil- lion stock market capitalization. But while Soliris is delivered intravenously, Achillion's com- pound is meant to be taken orally. For Achillion, as with any bioscience player, the key to suc- cessful drug commercialization is developing enough candidate compounds and putting them through rigorous development and clinical trials to ensure they cure more than they harm. "For us, the pipeline is the key,'' Deshpande said. "We have to keep developing our pipeline.'' But all of that takes time and money — lots of it. In the first half of this year, Achillion lost $18.5 million vs. $29 million lost in the first half of 2015. R&D and clin- ical-trial expenses, manufactur- ing costs and salaries accounted for the bulk of the company's cash burn in those periods. As is typical for drug developers, Achillion posted no revenue in the first half of this year vs. a modest $711,000 in revenue in the first six months of 2015. As of June 30, Achillion said it was running a pair of healthy volunteer clinical drug trials, and was preparing to start two other trials. One treatment targets PNH. Even from its earliest days dating to 2000, when it was born with the assistance of Yale Uni- versity's Office of Cooperative Research, Achillion has never lacked for talent and funding, said Deshpande, who has been with the company since 2001. "These days, investors are very sophisticated,'' he said. "They understand the science. They understand the true medi- cal need.'' n Achillion, its New Haven home grew up together By Gregory Seay gseay@HartfordBusiness.com W hile Achillion Pharmaceuticals Inc. was busy developing life-improving treatments, its land- lord was equally hard at work transforming the downtown New Haven laboratory-office building that's been its home from the start into a high-tech haven. Achillion's 300 George St. headquarters once housed thousands of miles of telephone cable and tons of communications-switching equipment back when former Southern New England Telephone Co. owned it. Today, the retrofitted 500,000-square-foot building houses offices and laboratories for at least a half dozen other bioscience companies. Achillion was 300 George's first tenant after Massachusetts-based Winstanley Enterprises acquired it in early 2000, followed soon after by antibiotics developer Melinta Therapeutics. Yale University, too, is a tenant, whose early occu- pancy from such an established, creditworthy lessee, "helped get the building off the ground,''said Winstan- ley Enterprises principal Carter Winstanley. From just 25,000 square feet on a single floor, Achil- lion has nearly doubled that footprint, now spread over three floors. The building is 95 percent leased. Melinta occupies about 40,000 square feet; nonprofit spoken-writ- ten language researcher Haskins Laboratories occupies about 25,000 square feet; Kolltan Pharmaceuticals has about 17,000 square feet. Yale University and Yale-New Haven Hospital, too, have sizable leases in the building. Achillion officials say the building is ideally suited to its needs, especially as its staffing continues to expand. As the building has been updated, so has its value; 300 George's land and building are listed on New Haven's tax rolls with an appraised value as of July 26 of $80 million and an assessed value of $56 million. That compares to a 2001 assessed value of $5.9 million, according to the city assessor's office. Many of the features that made 300 George ideal as a phone-company operations center have made it attractive as a bioscience facility, said Winstanley, who admits to initial doubts about the edifice's prospects. "When we first looked at the building, it didn't look like a rehab candidate,'' Winstanley said. But upon closer inspection of the building's inter- nal bones, the new owners came away pleasantly sur- prised, he said. For one, SNET had outfitted the edifice with a fully redundant electrical system, in case of power outages. It also had duplicate heating, ventilation and air-con- ditioning systems. Unusually high ceilings and extra- sturdy floor plates rounded out the building's struc- tural attributes. "A lot of those factors lent to a successful conver- sion [of 300 George] to a laboratory,'' Winstanley said. He won't say how much Winstanley Enterprises invest- ed to totally renovate and upgrade 300 George. Winstan- ley Enterprises is a major commercial developer that is landlord to a number of Hartford area properties, includ- ing the proposed Great Pond commercial-residential development in Windsor. The company also developed West Hartford's Elmwood Plaza on Newington Road. "We made a significant investment to bring the lab infrastructure into the core of the building,'' Winstan- ley said. "The building has been a fantastic operational lab facility for the last 16 years.'' But it turns out 300 George was only the first biosci- ence-specific development in downtown New Haven for Winstanley Enterprises. Earlier this year, it finished construction of 100 Col- lege St., the 14-story, 426,000-square-foot tower that in February became the new home of Connecticut's first bona fide bioscience success, Alexion Pharmaceuticals. Lessons learned with the rehab of 300 George were applied to the development of 100 College, located right across from 300 George, Winstanley said. With 300 George completed, Winstanley says his company has explored potential bioscience realty developments in the Hartford region. His experience, however, is that most bioscience startups prefer to cluster amid or near medical colleges. Winstanley Enterprises for a time owned the former Farmtech Corp. building at 400 Farmington Ave., in Farmington, directly across from the UConn Health Center and the new Connecticut outpost of The Jack- son Laboratory of Maine. The Farmtech property was sold to UConn, which has since rehabilitated the space as an incubator for bioscience startups. "We continue to always look for opportunities … ," Winstanley said. n 300 George St. is home to Achillion Pharmaceuticals and other bioscience-related tenants. Winstanley Enterprises has owned the building since 2000. Winstanley Enterprises developed 14-story 100 College St. that is head- quarters for Alexion Pharmaceuticals. P H O T O S | C O N T R I B U T E D David I. Scheer, chairman and co-founder, Achillion Pharmaceuticals Achillion has expanded its lab-office footprint at 300 George St. in New Haven. P H O T O | C O N T R I B U T E D

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