Pharmahorizons Lifetrack

Volume 8 Issue #1 - Feb 2007

Story 1:

Ecopia Announces Agreement with Caprion to Combine their Businesses and Launch a $30 Million Private Placement
Aim is to create a leading oncology and infectious disease firm

Montreal (January 4, 2007) —  Ecopia BioSciences Inc. (TSX: EIA) (“Ecopia”) and Caprion Inc. (“Caprion”) announced that they have entered into a combination agreement whereby they have agreed, subject to certain conditions, to combine their respective businesses through a plan of arrangement pursuant to which Ecopia and Caprion will amalgamate to form a new company with a strategic objective to create a leading oncology and infectious disease company.  The amalgamated company will have a portfolio of three active clinical therapeutic programs in advanced stages of development in cancer and infectious disease on a rapid path to commercialization and a sustainable pipeline of new opportunities.

Shareholders of Caprion will receive 69,871,584 common shares of the amalgamated company representing 50% of the amalgamated company’s total outstanding common shares following the closing of the proposed transaction, which is subject to the completion of a financing.  Desjardins Securities Inc. and Dundee Securities Inc. have been engaged to act as co-lead agents in connection with a proposed issuance of units of the amalgamated company by way of private placement on a best efforts basis for gross proceeds of at least $30 million.

Picchio Pharma Inc., a joint venture healthcare investment firm owned by FMRC Family Trust (a trust of which Dr. Francesco Bellini is a beneficiary), and Power Technology Investment Corporation, a subsidiary of Power Corporation of Canada, has placed a lead order of $4 million in the proposed financing.  It is contemplated that each unit will be issued at a price of $0.25, which has been determined based on the market price of the common shares of Ecopia during the negotiations relating to the private placement. Each unit will entitle its holder to acquire from the amalgamated company one common share and one-half of a warrant, each whole warrant entitling its holder to purchase one common share of the amalgamated company at a price of $0.375 for a period of 36 months.

“The combination is a bold move to create an integrated biotechnology company with scale, critical mass and diversified, later-stage clinical products. We are delighted to have received the support of a lead investor such as Picchio Pharma for this vision” said Lloyd M. Segal, currently president and chief executive officer of Caprion who will be chief executive officer of the amalgamated company.

“This merger and financing will create a strong entity with a balanced product pipeline focused in infectious disease and cancer as well as a strong balance sheet to continue the development of our three clinical products” said Pierre Falardeau, currently president and chief executive officer of Ecopia who will be chief operating officer of the amalgamated company.

The combination agreement contemplates that the amalgamated company will sell Caprion’s CellCarta proteomics business unit within the first 12 months following closing, so as to focus on exclusively pharmaceutical product development.  The agreement also provides that the current shareholders of Caprion will be entitled, subject to certain conditions, to certain payments in connection with any sale of CellCarta.

The amalgamated company will have a nine member board of directors. It will be composed of two members designated by Ecopia, two members designated by Caprion, one member designated by Picchio Pharma, three new independent members and the chief executive officer of the amalgamated company as representative of management on the board of directors.

Under the proposed terms of the transaction, all outstanding and unexercised options and warrants to acquire common shares of Ecopia will, on closing, be exchanged (on a one for one basis) for options and warrants to acquire common shares of the amalgamated company, and all outstanding and unexercised options and warrants to acquire common shares of Caprion will, on closing, be cancelled, except for certain warrants held by a third party which will be exchanged for warrants to purchase an aggregate of 5,300,000 common shares of the amalgamated company at a price of $0.375 per share for a prescribed period.

The plan of arrangement will also have to be approved by a final order of the Québec Superior Court.

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Story 2:

Montreal Economy and Job Market Deemed “Hyperactive”

According to The Gazette (Montreal, January 11, 2007), Montreal is enjoying robust employment in the areas of health and social services, finance, real estate, transportation and warehousing, along with professional services such as law and accounting, as well as business support functions. This comes at a time when the dollar is rising in value putting pressure on exporters, and when the US economy is slowing, they said.  

Overall Montreal’s good fortune seems broad-based states the report, noting that 57,000 of the new jobs out of 62,000 this past year just came during the past 7 months. “On the service side, it’s easy to explain Montreal’s big gain in health and social services jobs, since healthcare has been a priority area for government spending,” noted the report in an article titled: “For a laid-back economy, local job market is hyperactive”. The Gazette commented that the local aerospace industry was soaring as suppliers gained work from Pratt and Whitney Canada, Bell Helicopter, Bombardier, and flight simulator CAE Electronics.

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Story 3:

TBI Appoints New Executive Director

The Toronto Biotechnology Initiative is pleased to announce the appointment of Bill Laidlaw as our new Executive Director effective immediately responsible for membership initiatives.
 
Bill brings to TBI a wealth of expertise in public affairs, human resources, fund development and general management. Formerly Director of Government Relations with Glaxo Wellcome, he has held many positions over the years including Chief Executive Officer of the Ontario Chamber of Commerce, President of the Empire Club of Canada, CEO of St. John Ambulance in Ontario as well as Executive Director of the Ontario Community Newspapers Association.

“We are excited about this major step in TBI’s evolution and working with Bill as he focuses on promoting the Toronto Biotechnology Initiative in the Greater Toronto Area.” says Grant Tipler, President of TBI.

For more information contact
Grant Tipler, President, Toronto Biotechnology Initiative
P.O. Box 446, Station A, Toronto, ON, M5W 1C2
Tel: (416) 426-7293 Direct: (905) 286-7278
E-mail: grant.tipler@rbc.com

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Story 4:

McMaster Awarded $1m from Gates Foundation for HIV Research

McMaster University and the Centre for Gene Therapeutics in Hamilton will receive $200,000 annually for five years to continue its research to develop and test vaccines, and collaborate with researchers to produce effective HIV treatments. Dr. Ken Rosenthal, head of the viral vaccines division at the gene therapeutics centre, will work with researchers at Duke University in North Carolina and with the U.S. National Institutes of Health, in Maryland, on applications to block or neutralize HIV infections.

“From my end, that’s the most exciting part of the grants,” said Dr. Rosenthal. “The Bill and Melinda Gates Foundation has enabled us to develop these new approaches to solving complex problems by forming larger collaborative relationships.” Overall, 16 grants totaling $287 million are being allocated over five years. Investigators in 19 countries will share findings in real time and compare results.

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Story 5:

One of Canada’s Top 10 Life Science Companies Closes Ottawa’s Largest Life Science VC Deal of 2006

The Ottawa Life Science Council (OLSC) serves the life science and biotechnology communities through programs and initiatives designed to impact the growth of local industry and aid in supporting Ottawa and Eastern Ontario as a leader in the global marketplace. Regular luncheon and breakfast series showcase local entrepreneurs and their success and challenges, while their business network partners provide a wide range of professional development topics. In addition to its core programs, the OLSC has a number of initiatives focused on promoting, developing and celebrating achievements through the creation of Business Opportunities Networks within specific sectors of Ottawa’s life science and biotechnology industries.

For more information, visit OLSC’s website.

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Story 6:

Federal Government to Invest up to $25 Million in Saskatoon Vaccine Laboratory

The PHAC reported that the International Vaccine Centre (InterVac) will be the first facility of its kind in the world, unique in its focus on vaccine development for both animal and human pathogens. It will be fully equipped to act as a Level 3 high-containment large animal vaccine testing facility with facilities to house up to 180 cows or 5000 chickens. Nearly 80 per cent of emerging infectious diseases affect both animals and humans, posing threats to the health of Canadians and our livestock industry. Avian Influenza and West Nile are two examples of these kinds of diseases. When completed, InterVac will be one of the largest vaccine research labs in North America with leading edge facilities unavailable elsewhere on the continent.

"Research and development done by InterVac will help control existing infectious diseases while also preparing Canada for future public health risks,” said Minister Clement. “InterVac will also provide parallel capacity to other labs, for rapid vaccine development."

The Honourable Carol Skelton, Minister of National Revenue, emphasized that Saskatchewan will begin to lead health science innovation. "Today's investment in InterVac builds on Saskatchewan's excellence in agriculture and health research and continues to diversify the provincial economy," said Minister Skelton. "This is also an investment in the innovators, researchers and achievers who will lead Saskatchewan to the forefront of health sciences in Canada and in today's global economy."

Parliamentary Secretary David Anderson, who was representing the Honourable Chuck Strahl, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board, commented that this project benefits individual health and our economic health.

"Supporting research and development that benefits both human and animal safety is a priority of this government," said David Anderson. "By protecting Canadians and our livestock industry from diseases, we create benefits for our own health, the food supply, producers and our economy."

InterVac will be one of the largest vaccine research and development laboratories in North America. Construction of InterVac's facilities is expected to begin in Spring 2007 and be completed in three years. The laboratory will be owned and operated by the University of Saskatchewan.

University President Peter MacKinnon, explained that the new facility has been created to “address diseases affecting both humans and animals which account for 80 per cent of all emerging infectious diseases". "By investing in this national facility,” said MacKinnon, “the federal government is augmenting the network that will be necessary in managing future outbreaks."

The InterVac project was developed by the Vaccine and Infectious Disease Organization (VIDO), a non-profit organization owned by the University of Saskatchewan. According to a CBC report, the facility is expected to cost $110 million to build, and construction is slated to begin this spring and be completed by 2010.

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Story 7:

Federal funding gives the bio-economy a boost

The Canadian Government announced funding aimed at combating climate change and bolstering the nation’s bio-economy with a $345 million infusion. The Honourable Chuck Strahl, Minister of Agri-Food and Minister for the Canadian Wheat Board announced that this funding would be used to implement two agriculture programs:

· $200 million Capital Formation Assistance Program for Renewable Fuels Production to provide producer incentives for participation in new renewable fuels production.

· $145 million through the Agricultural Bioproducts Innovation Program to support cross-sector research networks conducting scientific research and development to advance Canada’s bio-economy.

The Honourable Rona Ambrose, Minister of the Environment, (now Minister of Western Economic Diversification), announced that the Government would regulate an annual average  renewable content of five percent in gasoline by 2010 and two per cent renewable content in diesel fuel and heating oil by 2012. Lionel LaBelle, President of SEDC commented by saying,  “We are very pleased with this announcement and are grateful that Ministers Ambrose and Strahl chose Saskatoon, Saskatchewan as the location to make this national announcement”.

However, Saskatchewan’s deputy premier Clay Serby had some reservations, noting that the announcement is tied to the implementation of Canada’s Clean Air Act, which will be tied up in committee for some time. Furthermore, Serby commented that “we can’t build the industry without incentives and tax parity with competing jurisdictions, namely the United States.” He added that the federal government’s $200 million program appears to be repayable and is generally shy on details. The announcement is positive for Canada’s growing bio-economy and may pave the path for a cleaner and more prosperous future for citizens. How this story unfolds through the New Year remains to be seen, however a strong backing from Saskatchewan organizations and leaders positions us at the forefront of this emerging industry.

Reference: The Bio-Bulletin is produced by Ag-West Bio Inc.   http://www.agwest.sk.ca.

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Story 8:

CMAJ embraces new Editor-in-Chief (Editorial comment)

Embracing an energetic start to the New Year, the Canadian Medical Association Journal (CMAJ) has harnessed an enthusiastic Ottawa clinician and scientist, Dr. Paul Hébert, as their new Editor-in-Chief.

Dr Hébert is well-known among colleagues for moving in multiple directions at any one time and holds positions as vice-chairman of research in the department of medicine at the University of Ottawa, where he is also a professor of medicine in the departments of critical care and epidemiology, and chairman of the Ottawa Health Research Institute’s transfusion and critical research areas.

CMAJ has been without a permanent editor for over 8 months after a controversial transition which saw the former editor and several team members leave or be dismissed.

Dr Hebert faces many challenges but envisions the journal as having an independent voice, and according to his first publication, aims to “substantially increase both the quality and quantity of original patient-centred research articles in the journal,” and to “expedite the review and acceptance processes” for manuscripts submitted. Hébert intends to broaden representation on the editorial board in order to represent the diverse interests of 60,000 physician subscribers. Plans include a stronger emphasis on the journal’s online version, with tools to help physicians in their practice. Content for French-speaking readers will be increased.

While Hébert feels confident he can address the need for innovative ideas--even if controversial--particularly in the debate to fund the Canadian health care system and reduce wait times, he remarked in his New Year’s issue that “all editorials will be signed to ensure that we accurately attribute views to the author(s) and not the CMAJ or the CMA.”

Hébert is known for his ability to pounce in all directions, and by this time next year readers will judge whether he stood up to his reputation.

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Story 9:

Ontario Commission Blames Poor Hospital Infection-Control for 2003 SARS Epidemic in Toronto

Poor Hospital Practices Blamed for 2003 SARS Epidemic in Toronto
By Christopher Mason, The New York Times.

Toronto (January 9, 2007) — A provincial commission investigating the SARS outbreak in 2003 reported Tuesday that poor hospital infection-control procedures led to the epidemic in the Toronto area that killed 44 people.

“Systemic problems ran through every hospital and every government agency,” Doug Hunt, chief counsel for the commission, said at a news conference at which the findings were released.

The outbreak surfaced in February 2003, when a woman from the Toronto area contracted the virus on a trip to Hong Kong and returned home, dying soon after. Her son went to a hospital with an unidentified condition that was later diagnosed as SARS. While waiting for 16 hours in a crowded emergency room, the man transmitted the virus to two other patients, and it continued to spread, the commission’s report says.

Of the 375 SARS cases eventually identified in Ontario Province, health care workers accounted for 45 percent. Two nurses and a doctor died from their infections.

The ailment that came to be known as severe acute respiratory syndrome, or SARS, was reported first in Asia in early 2003, though the first case may have been the previous November. By July, 774 deaths of 8,000 infections worldwide were attributed to it, according to the World Health Organization.

Outside Asia, Toronto was the world’s most affected city, crippling tourism and leading the World Health Organization at one point to advise travelers to stay away.

On May 17, 2003, three months after the first case in Ontario, the authorities declared the crisis over. As a result, the report released Tuesday found, surveillance and prevention measures were relaxed, and an outbreak brewing at another hospital was not detected until it was too late. On May 23, health officials announced a second, larger outbreak.

“As soon as precautions were relaxed in early May, the disease surged back and spread, again undetected, to patients, staff, visitors and their families,” wrote Justice Archie Campbell, the report’s author, who did not attend the news conference because of illness.

Among the commission’s recommendations are dozens of changes to hospital practices and health surveillance, and new legislation. The report also said the province’s labor department should play a more prominent role in protecting workers from disease outbreaks. Two earlier reports focused on problems in the public health system and in emergency response laws.

The pressure to have the W.H.O. travel advisory lifted and to declare an end to the emergency allowed the second outbreak to take root, according to Dr. Richard Schabas, who was chief of staff during the SARS crisis at York Central Hospital.

“After the advisories were lifted there was a huge pressure on Toronto not to have any more cases,” Dr. Schabas said. “As a result, there was no surveillance program to alert authorities of what was actually happening.”

©2007 The New York Times

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Story 10:

Pfizer Reduces Global Sales Force; 285 Layoffs Announced for Canada

Some analysts feel other drug companies may follow suit now that sales competition in the field will be reduced. On the other hand, some may see this as an opportunity to reach into competitor’s markets. Many American doctors already complain that they are visited by too many sales representatives, taking time away from their practice and seeing patients.

The new chief executive from General Electric Jeffrey B. Kindler, now leads Pfizer with these bold new moves. News indicates that Pfizer will continue to reduce costs during the next two years. Pfizer Canada indicated that there was “global reorganization taking place”, and that there would be 285 layoffs within Canada.

In a press release issued January 31, Pfizer Canada reported the reduction of approximately 285 positions over the next 6 months that will impact all parts of the organization including head office and field-based employees.

"We have undertaken a comprehensive review of every aspect of our business to determine the steps we need to take to position Pfizer for future success," said Jean-Michel Halfon, President of Pfizer Canada Inc. "This exercise has forced us to rethink how we do things, how we prioritize and how we allocate resources in order to better meet the needs of an evolving healthcare market. These decisions are difficult and we are sorry to see valued colleagues leave our organization. However, consistent with Pfizer's long-standing values, we will provide impacted employees with support services during their transitions."

Eurpoean field forces would be reduced by 20 percent as they take steps to streamline operations, indicated a press release issued January 22. The report explained that Pfizer was “dramatically simplifying the organizational structure of R&D to increase accountability, flexibility, innovation and entrepreneurship.”

They aim to generate cost savings through “site rationalization in research and manufacturing, streamlined organizational structures, staff function reductions, increased outsourcing and procurement savings.”

From 2003 to 2008, Pfizer will have reduced its network of manufacturing plants around the world from 93 to 48.

Pfizer said it will do everything it can to offer support and benefits to all colleagues affected by these difficult actions, and said it was committed to working with community leaders to mitigate the impact of these closures in whatever way it can.

Indicated that they will experiment with new approaches to bringing its products to market, Pfizer is seeking new and more effective ways of communicating with physicians and patients, inviting payers earlier into the development process, and enhancing its collaboration with academic and other research institutions.

"By reducing middle management and increasing spans of control, we're getting leaders closer to colleagues and customers and giving colleagues a clearer line of sight to those aspects of the business for which they are accountable. As a result, our managers will delegate, empower and focus on developing colleagues more than ever, and our colleagues will grow and take on more responsibility than ever," said Kindler.

Pfizer has over 100,000 employees globally, with 42,000 in the US. Approximately one-third of employees are in sales-related positions.

In spite of these cuts, Pfizer remains very profitable with $14 billion in profits in 2005, excluding one-time charges, on $51 billion in total sales. Pfizer has a $7 billion annual research budget, but ended a research collaboration with a European company to develop asenapine, a treatment for schizophrenia that was predicted to be a multibillion-dollar drug. Other news indicates that Pfizer has stopped all clinical trials of torcetrapib, a drug aimed at raising “good cholesterol” based on recommendations from the independent Data Safety Monitoring Board (DSMB) monitoring the ILLUMINATE morbidity and mortality study because of an “imbalance of mortality and cardiovascular events.”

According to a news release from Pfizer, it will bring increased focus and emphasis to its business development and licensing efforts in order to identify new products and technologies that will supplement its pipeline. Pfizer aims to introduce about six new products a year starting in 2010.

Even though approvals for new drugs by the American FDA regulators were significantly lower in 2006 than the previous 3 years, both Pfizer and Merck each had two approved in 2006, the most of any company last year, as cited by Bloomberg news, January 4, 2007. Eight new drugs were approved in 2006, close to an eight-year low, as drug makers struggled to develop products for hard-to-treat disorders.

According to Reuters News Agency in Washington (January 9), the FDA, which has been criticized recently for drug safety issues, said that the FDA reported adequate means to watch for problems with drugs on the market and that keeping up with advances in technology while assuring safety will require more rigorous but efficient FDA oversight.

FDA Commissioner Andrew von Eschenbach clarified that "Rapid does not mean reckless. I really believe when you apply rigor, discipline and precision, the processes by their very nature don't necessarily need to be slower... I think we can do it even better and faster," he said.

Dr von Eschenbach said his philosophy was to make the FDA "a bridge, not a barrier" to advances in health care that will be driven by a growing understanding of how medicines work at the molecular level and affect individuals differently.

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Story 11:

Competence

When something goes wrong, like a buzz in the PA system, for instance, they may not know exactly where it's coming from, but they know how to troubleshoot to find it. They check one piece of equipment, and then another, and then another, until they find the problem.

Exhibiting competence in knowing what you're doing, or knowing how to get something done, is communicated to others in a variety of ways. There's the obvious level of actually being able to do what you say you can do. Your "nonverbals" - how you look, the sound of your voice - go a long way toward conveying competence. So does the style of behavior you choose-whether you come across as a very casual person, or as someone who's a professional and takes herself seriously.

 "The style of behavior you choose," was mentioned because you do have a choice. You can choose to behave in a way that exudes competence, or you can choose to undercut what skills you do have by looking and acting as if you're not sure of yourself.

Your ability to gain influence with other people is dependent on how they see you, whether they judge you to be trustworthy, and whether they think you really know what you're talking about, or can manage the tasks you claim you can. You'll go a long way toward gaining that trust when you're able to impress them with your competence.

--Tony Alessandra, author and lecturer

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Story 12:

Prepare for Wi-Fi Invasion, Face Recognition, and On-line Application Surgence Wi-Fi

According to a report by ITWorldCanada, consumers will increasingly demand Wi-Fi in gadgets for the convenience, power and flexibility of being able to zap information around seamlessly. Yes, unloading photos from your Nikon, Canon or Kodak camera without the hassle of locating misplaced cables, will promise to make your life easier. Now Samsung’s new Plasma TV (HP-TS064) can connect to your PC over Wi-Fi, so you can watch YouTube videos or other Internet- or PC- based content, such as photo slideshows, on the TV.

Face Recognition
According to the report, face-recognition technology will show up in a number of consumer products and services, including digital cameras, online photo search engines and biometric security devices.

Software features in an increasing number of consumer digital cameras this year will offer face detection. Software will detect the difference between a human face and surrounding objects in the picture. When you press the "face recognition" button, the camera will favour faces for focusing and for auto-exposure.

Another application for face recognition will be online searches for photos. Normally searches are based on keywords and tags--“words” rather than images. But face recognition can help us find photos of people online by searching images. British Columbia police have image matching technology to search many license plates quickly and compare them to a database of offenders and files. We’ve heard of face recognition being used at large sports events by law enforcement agencies in America, but Polar Rose is a consumer search engine that combines tagging with face recognition to help you find pictures online you'd never find otherwise. The technology will take off this year, and will go mainstream when Google and Flickr embrace it, says the report.
“Face recognition will manifest in the form of biometric security for PCs and laptops. The technology has been around for a decade, but new improvements in quality will boost its usability for consumers this year. Lenovo's Y300 and Y500 notebooks, for example, have cameras and face-recognition software that prevents people it doesn't recognize from gaining access to the system.”

Browser-based computing
With rising costs to purchase software, more firms are switching to browser-based software. Various companies -- especially the anti-Microsoft crowd, including Google, Sun and others -- have been pushing browser-based computing for years, the report indicates. On-line applications allow you to access your work or personal files from anywhere at anytime. That wasn't really feasible a few years ago, but now the selection and quality of browser-based applications make it possible to do everything online.

Chyma Systems in Montreal (www.chyma.net) began providing to doctors several years ago online software to create and manage on-call shift schedules so shifts could be monitored and traded from anywhere that one has access to the Internet. Beforehand, hospital administrators often spent hours each day locating doctors for shifts because schedules constantly changed to meet the changing demands from healthcare facilities. These shift changes created a nightmare to track when multiple doctors were involved. Now physicians can trade shifts easily with colleagues or be notified of their own shift on their portable handheld device wherever they are located. Developed by a doctor, Chyma allows physicians to conveniently manage contacts, messages, files, and calendars of events without having to call the hospital. And there is no hardware to install or costly software to purchase, which is the attraction of browser-based applications.

In their report, ITWorldCanada further explained that the idea of storing personal documents online and using online applications is especially appealing to users with smart phones, especially when the same applications can be used on both PC and phone. While the Smartphone definition is not clearly defined, its features tend to include Internet access, email, scheduling software, built-in cameras, contact management, GPS navigation software and occasionally the ability to read business documents in a variety of formats such as PDFs and word processing files.

Merging browsers and cell phones
We are all looking for portable functionality to access our knowledge war-chests, and now Yahoo and Motorola are introducing new software for cell phones that makes it easy to find information more quickly by moving among various online services providing news, sports scores, maps, weather, movies, photos and e-mail. This venture was announced at the Consumer Electronics Show in Las Vegas January 8th reports The Wall Street Journal. Google also announced a partnership to put its own mobile software on Samsung cellphones.

Always ready to unveil its creativity, Apple just launched its new iPhone with a series of applications including e-mail, advanced voice mail, photo collections and visually appealing Web searching, reported The New York Times, January 9. Apple spokesman Steve Jobs promoted the fact that the new iPhone is powered by the same core OS X operating system that the Macintosh computer is based on, offering power-management features and advanced graphics abilities.
The report indicated that user interface relies heavily on a high-resolution touch screen that makes it possible to use a finger to control the phone. It has features that are still more subtle, including sensors that track light and movement and proximity, to prompt the phone to control screen brightness and physical orientation and other aspects of its operation. For example, when the phone is placed next to the user’s face, the keyboard is automatically turned off.

Whether you are at home, work or the coffee shop, connectivity is key, and any efficiency we gain helps us meet the challenges of quickly processing more information more quickly each year.

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