Bothell Bio Boost
Alder Biopharmaceuticals, which survived tough times with the support of the local biotech community, is riding high thanks to a billion-dollar commitment by Bristol-Myers Squibb to one of Alder’s most promising drugs. But even with a huge boost in cash and confidence, the seven-year-old company is treading carefully through what is known as “the valley of death”—the startup-killing period between promising findings and commercial launch of a drug.
From its modest suburban campus in Bothell, Alder is now directing clinical trials for ALD518, the compound that captured Bristol’s attention by showing promising results in the treatment of inflammation in rheumatoid arthritis and cancer, which afflict millions of Americans and represent giant markets. Rheumatoid arthritis alone afflicts an estimated 1.3 million adults in the United States, many of whom are not getting relief from current therapies such as Bristol’s own Orencia, Abbott’s Humira and Amgen’s Enbrel.
In the fall of 2009, Bristol pledged $1.07 billion, starting with a first installment of $85 million, in exchange for the rights to develop and sell ALD518 for inflammation in rheumatoid arthritis and other indications. The complex agreement also includes royalties to Alder from Bristol’s sale of the compound for arthritis applications. Alder retained the rights to develop and sell the compound to treat devastating weight loss associated with cancer.
It’s a tricky time for founders Randall Schatzman, CEO, and Mark Litton, chief business officer, who launched Alder in 2004, not long after sketching their ideas over a dinner at a McMenamins restaurant. They say they learned important lessons from the closure of Celltech R&D, a United Kingdom company with a lab in Bothell, where both had worked, as well as from watching the takeovers of other local firms with promising products, such as Immunex and ZymoGenetics. “We saw a way to build value and remain an independent company with a deep pipeline,” Schatzman says.
One of Alder’s lessons was to stay lean and independent for as long as possible. Schatzman had to lay off employees at Celltech R&D when its owner in Great Britain decided to shut it down. So when he and Litton hatched the idea for Alder, they decided to move cautiously, keeping things going for almost a year before they brought in their first investors.
They credit their survival through those tough early days to a “village” of supporters in Seattle. A corporate attorney helped them get incorporated, and another biotech, Ceptyr, lent