Imagion Biosystems (ASX: IBX): Interview with CEO Robert Proulx

Imagion Biosystems (ASX: IBX)

We spoke with Robert Proulx, CEO of Imagion Biosystems (ASX: IBX) about diagnostic break through represented by the company’s MagSense technology and the current Phase II study in Her2-positive breast cancer.

 

Read our most recent article on IBX here

 

Transcription

 

Stuart: It’s Wednesday, the 13th of October, 2021, but in Lake Tahoe, Nevada, it’s still the 12th of October. And I’m talking with the legendary Bob Proulx, who’s the CEO of Imagion Biosystems (ASX.IBX). Bob, Good afternoon.

Bob: Good afternoon, Stuart. Nice to see you again.

Stuart: When you told me that you were living now in Lake Tahoe, I have to confess, I broke the 10th commandment there briefly, but it’s testament to the fact that the life scientists are truly global. Here’s Imagion Biosystems, publicly traded on ASX, CEO is in Lake Tahoe. Your CFO is Jeoff Hollis is in Melbourne. You’ve got a laboratory in San Diego. Where else in the far-flung Imagion empire are we located?

Bob: That’s pretty much it, although we do now, you know, having made some progress with our work. We have a few more people in Australia, so we’ve got a couple of business development people, one in Melbourne, and one in Sydney. So, we’re expanding our capabilities in Australia while we still develop the product here in San Diego. And I’m currently taking advantage of the lovely coming winter here in the Lake Tahoe region.

Stuart: Right. Now, many investors may have seen the article you wrote a couple of months ago on Imagion Biosystems. But, Bob, refresh our memory. Imagion Biosystems has one of the more powerful cancer diagnostics that’s still coming. Describe to us the technology that you’re building.

Bob: Yeah, thanks. So, we’re a medical device company developing what we consider to be, sort of, the next generation of non-invasive molecular imaging. So, you know, you might remember that conventional and imaging methods like ultrasound, CT, MRI. They’re very good at visualizing tissue and identifying areas of suspicious lesions, but they’re not very good, for example, at being able to differentiate benign from a malignant tumor. And so, you know, even when they are able to identify a lesion, you know, they’re kind of limited in the size of the tumor that they can identify. They need about a 1-centimeter spot to be able to identify it. And, you know, typically, in the growth phase of cancer that starts to get late stage, by the time the tumor’s about one centimeter you’ve progressed pretty significantly. So, our MagSense technology is using bio-safe magnetic particles to tag the cancer. These particles have the property that…the magnetic property of the particle allows them to act like a magnetic beacon when they become attached to the tumor. And so, we are offering a very sensitive, specific way to non-invasively detect tumors without using radiation like in what would you’d use in a PET tracer.

Stuart: Right. And arguably at low cost. I mean, we’re all used to the expense items in the health budgets for MRIs. You’re about to blast a hole right through that budget ultimately.

Bob: Yeah. We’re hoping to be able to do that. I mean, the equipment that is used for MagSense technology, is less expensive than an MRI, doesn’t require a shielded environment. Additionally, the injectable imaging agent is going to be able to be made at an affordable price. It has a long shelf life unlike the use of a PET tracer that needs to be made typically in a local cyclotron and has a relatively short half-life. Our technology lends itself to being able to be something that actually can be packaged in a way to be more cost-effective when administered to the patient.

Stuart: Right. Now, when I’m describing imaging, the shorthand I use is 1000 times more sensitive than MRI. Now, that’s not an exaggeration, is it?

Bob: Well, we hope not, right? I mean that’s our aim here, right? You know, so if you think about the ability for MRI to visualize a 1-centimeter tumor, we’re looking to try to get that down to about a 1-millimeter tumor, similar to the sensitivity of a PET tracer, but without having to use a radioactive isotope to detect that. So, yes, we think that we’re a good order of magnitude are more and more sensitive than MRI would be, for example.

Stuart: Right. Now, you and I first met about 2019. You’ve made a lot of progress since then. MagSense is now in the clinic, and literally not recruiting as quickly as you’d like, but hey, look, that’s the times we live in.

Bob: Yeah, fair enough. Yes, we’re very proud to have made it into the clinic. I mean, this is a major milestone for almost any biotech company, right? To get their product into the clinic, and to pass in human testing. So, yes, earlier this year, we got into the clinic in Australia with our first clinical site. We enrolled our first patient in May. And as you well said, yes, it’s been a little bit slower than we anticipated in terms of recruitment, but we’ve added a number of sites.

So, very happy to be able to tell you today that our fourth site is now up and running. We’ve added the Lake Macquarie Private Hospital in New South Wales, not very far from where you are. This is part of the Ramsey Health Care Group, one of Australia’s largest private health care providers. And so, now this gives us sites in the State of Victoria, in the State of New South Wales, and in Queensland. So, we’re finally in a position now where we think we can begin to expand that enrollment into our study. We were very limited at the beginning in only Victoria. And, as you know, there’s been significant lockdowns in Victoria, but we’re anticipating to see that start to shift. New South Wales is coming out of lockdown, and, for example, are reinstating breast screening services. So, we think that we might start to see a change in our recruitment capabilities just now that Australia’s finally getting a little bit of a handle on this. You may have seen, Stuart, there’s been plenty of reports of reduced breast cancer, or not in breast cancer, but cancer screening, in general, there’s been a lot of worry about people going undiagnosed, and the impact this might have. And so, we’re hopeful that with things hoping to return to somewhat measure of normality in Australia that…and now with four sites being able to start to recruit, we’ll see an uptick in our ability to start to populate this study.

Stuart: Right. So, we’re evaluating the technology to detect breast cancer. What’s the exclusion criteria in this study, or inclusion and exclusion criteria?

Bob: Yeah. So, that’s one of the interesting things about this is that this… Our first product is for a very particular form of breast cancer, HER2 expressing breast cancer. So, that’s a subset of all breast cancer patients which also is part of the limitation in the number of patients that we can identify, right? We’re only going after a particular form, and there’s a reason for that. And that is because we knew that we could identify a very specific targeting ligand for our particles that was highly specific for HER2 breast cancer. Right. And for our first product, we really wanted to make sure that we were gonna achieve that level of specificity, and sensitivity, and not necessarily go for the home run as we would say, or you would say go for a six, I guess.

Right. But we really wanted to get that base set, demonstrate the targeted nanoparticles report, so, yeah. So, our first study now is looking at metastatic breast cancer. Breast cancer patients, the first thing they wanna know when they’ve been identified is having a tumor, they wanna know if it’s spread to the lymph nodes. And the way we do that today is by surgically removing the sentinel lymph node, or by doing biopsies on those lymph nodes. That’s great. That works really well, except for the fact that more than half of patients are node-negative. So, the doctor is going back to the patient and saying, “I got good news, no metastatic spread. Bad news is I just cut your lymph nodes out to try to get that answer.” So, we saw that as being a real unmet medical need, that if we could non-invasively differentiate node-negative patients from node-positive patients, we have a way to improve health care for 50% of the patients. And, in fact, the FDA in 2019 looked at our application for this HER2 breast cancer and said, “If you can do that, this would be a breakthrough. Because today, we’re having to do biopsies on every single patient.” And so, they designated…

Steward: I recall when we wrote about that. We flagged the potential for breakthrough device designation down the track, right?

Bob: Yeah, that’s right. And so, we got that. And so, ultimately, when we do, you know, our follow on studies here in the United States, we’ll be doing that as a breakthrough device, but, you know, it’s one of those things where limiting our focus on her HER2 breast cancer isn’t a bad thing from the perspective that we know we can look at a very specific outcome here. We know we’re still addressing an unmet medical need. It reduces the target population for us to begin with, but it helps us, I think, from the clinical study perspective because we’ll be able to, you know, get very straightforward answers against the current standard of care of pathology.

Stuart: Right. Now, for women who are watching this interview, presumably the studies up on clinicaltrials.gov, and whatever the comparable website site down here, right?

Bob: Right. That’s right. It’s listed on the ANZCTR, Australian Zealand… Yeah. So, it’s listed there. We’ve been doing a lot of outreach through social media Facebook, LinkedIn, and other places trying to get the word out that the study exists. And so, you know, again, it’s a somewhat limited patient population. It requires a newly diagnosed HER2 patient. And so because we don’t want to look at patients who are already undergoing treatment because we don’t want to interfere with the treatment, for example. But yes, there’s an increasing disability, through our sites now, and through some of the social media work that we’ve been doing to try to get the word out that this study exists in Australia. I mean, this is a first-of-its-kind study. To our knowledge, no other manufacturer has ever brought a targeted magnetic nanoparticle into the clinic for the detection of cancer. And so, this is big news as far as I’m concerned, for Australia, in general, and for us being a medical device in ASX-listed medical device company. We’re doing something that’s not ever been done before.

Stuart: And what’s more? Admittedly, it’s a little bit difficult to find women at that point just when they’ve been diagnosed, but before the potential lymphadenectomy. But, let’s face it, it’s 1/5 of all breast cancer, roughly. So, HER2 is not an insignificant population to be, to be testing it, right?

Bob: Well, not only is it not insignificant, but it’s also one of the more aggressive forms of cancer. So, if you’re worried about metastatic spread, whether it’s gone to the lymph nodes, unfortunately, HER2 is one of the ones that, you know, will tend to be metastatic compared to some of the others. So, it is really important that we’re able to differentiate that. And look, even with pathology, there is known to be a false negative outcome, right? Sometimes in pathology, they miss it. So, a patient is diagnosed as being node-negative. They undergo surgical treatment of the primary tumor, but unbeknownst to the physician, and the poor patient, you’ve got, you know, latent disease sitting in the lymph nodes that was never addressed. We’re hoping to fix that. We’re hoping to have a very highly sensitive test that can really differentiate node-negative from node-positive patients, and say, “Those patients are truly negative. Leave them alone, go ahead and treat the primary tumor, but leave the lymph nodes alone.” So that you don’t end up having the side effects associated with lymphedema, etc., that you just described.

Stuart: Bob, it’s not just HER2-positive breast cancer. There’s a whole pipeline of MagSense opportunities building out. And you’ve got collaborations with people like the CSIRO, and ASX-listed Patrys (PAB). Talk to us about some of those initiatives you’ve kicked off.

Bob: Yeah. So, as we got closer and closer of moving the HER2 product into the clinic, I wanted to be sure that we had a pipeline of products, right? We didn’t wanna be a so-called one-trick pony of just her HER2 cancer. So, we began working in earnest on our pipeline probably about 1 year, 1-year-and-a-half ago, but this past year, we’re very fortunate. We got a small CSIRO grant to focus on prostate cancer, which we’re now doing with folks at Monash University to help us with animal studies associated with that. We’ve been talking to the folks at Patrys about their dioxin med product as a possible way to target brain cancer. And so, this past year, we started to do that preclinical work. All the work that we had done with HER2 in the pre-clinic of doing in-vitro, and animal models, etc., we’ve now started to build that pipeline. Because I think we said to you, as you covered us originally, you know, our view has always been that the right way to commercialize the MagSense technology is for us to partner with someone. And whether that’s a GE, or Siemens, or Toshiba, or somebody, we think that, you know, they’re already players in that medical imaging space. We’d like to partner with them. Well, we know that in order for us to be an attractive partner, we gotta have a pipeline of products. They don’t wanna bring just one test to market. They’re gonna wanna know that there’s more behind that. So, this past year has been all about getting the HER2 product into the clinic and establishing the fact that we’ve got more than one kind of imaging agent, and that we can tackle multiple types of cancer.

Stuart: So, finally, Bob, for investors who don’t know you, tell us a bit about your background. I like to joke that you get around the streets of Lake Tahoe, and people say, “Are you the brother of the lady who wrote the “Shipping News,” which I think we established that Annie Proulx is not your sister. Tell us about Bob Proulx, the biotech entrepreneur.

Bob: There you go. Thanks. So, look, I’ve spent 30 plus years of my career working in the Life Science Instrumentation Medical Device, diagnostic space. So, almost all of it is been in trying to identify new, and interesting technologies that could either improve laboratory medicine, laboratory research, etc. So, I’ve always had, sort of, a very technology focus to my career, but mostly from the commercial side. So, how do you define the product, the market needs? How do you bring it into the marketplace? So, I’ve led global sales organizations. I’ve established some city area operations in different countries, for example, to commercialize products. And so, really what I think I’ve brought to the table in joining Imagion six-plus years ago now was a commercialized focus to the business, right? It’s not only about the technology, it’s about what can you do with the technology? And do you understand the path of how to bring that into the marketplace?

And so, I think we’ve been pretty rigorous about having a roadmap of identifying…and pragmatic, I should say, about how do we approach product development to demonstrate that we’ve got, sort of, a minimally viable product. We have a known unmet medical need. Clearly, that has been vetted by the FDA with their breakthrough designation. And that you have a clear understanding of the steps that you need to go through. And, I would say, that, you know I’m very fortunate that in addition to my 30-plus years of experience, we got an extraordinarily experienced board of directors. You know, we have people who were the Chief Technology Officer at GE Healthcare on our board, right? Every ultrasound, CT, etc., I think maybe you…I can’t remember if you met Mike, for example, or not, but Mike’s on our board of directors. We’ve got people like David Ludvigson, who are serial CEOs, and entrepreneurs developing medical devices and diagnostic products. Diane Angus, who’s an Australian serial CEO of biotech companies. She’s been, you know, developed therapeutics. So, you know, we’re very fortunate that we’ve got a highly competent board, with knowledge about not only the development of technologies but how do you commercialize them? How do you properly fund a company, etc.? So I think we’re in good shape today, as I said, we’re extraordinarily proud to have made it into the clinic. We can see what’s in front of us. We’re trying to get through that clinic. And we started to build the pipeline of other products. So, I’m pretty optimistic about our next phase of our business.

Stuart: Well, Proulx, well done in everything you’ve achieved today. I’m particularly pleased about the breakthrough designation from FDA, but it’s executed magnificently. And if the hospitals in Victoria had come to the ballpark, we’d be even further down the track, but you’ve achieved a heck of a lot, so well done.

Bob: Great. Thanks very much. Nice to catch up with you again, Stuart. Take care.