Date: Jul 05, 2013 Source: bizjournals (
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Since we last spoke with Qrono, the now-specialty pharmaceutical firm has changed the spelling of its name from ChroKnow and refocused its business model.
Instead of selling a service, the company is now working toward selling it own pipeline of products.
To accomplish this objective, it's taking a path more life sciences companies are adopting: Use government grants to help fund work that can lead to early customers, and secure follow-on financing through economic development or angel investors.
So far, the company has completed the life sciences accelerator through the economic development group Idea Foundry and secured funding and support through that organization, CEO Larry Zana said.
On the government funding front, Qrono has received a Small Business Technology Transfer Phase I grant from the National Institutes of Health and a Small Business Innovation Research Phase I grant from the Department of Defense. These two grants total just more than $400,000, Zana said.
The NIH grant is for a drug formulation for wet age-related macular degeneration, and the DOD grant is for a drug formulation to protect warfighters from nerve agents.
Qrono is developing formulations of existing drugs to be long acting, injectable medications with a controlled time release. The company's target drugs are those that have high nonadherence rates by patients, with the idea being that with better time release, patients won't have to take them as often and will perhaps better adhere to treatment.
What makes Qrono's business unique is how it comes up with these formulations. The company's core technology, licensed from the University of Pittsburgh, is software that can model the formulation and determine the best recipe before researchers have to physically make it, thus cutting down on the trial and error time and cost to come up with new formulation.
Previously, the company was looking at selling its formulation service, but Zana said it became clear it should come up with its own pipeline of products.
"The technology risk is behind us," Zana said. "The software is proven, and we want to scale up and hit the gas."
The goal for 2013 is to attract more early customers — Qrono has two universities contracting for services — so it can pursue investment capital to generate preclinical data and start trials. Zana doesn't see the company taking a formulation all the way through the regulatory process on its own, but does anticipate partnering with Big Pharma at some point.
Because the company is using existing drugs, the regulatory path is somewhat smoother than other companies coming up with novel drugs.
Using a foundation of government funding is going to be a common occurrence moving forward, especially for early stage life sciences firms, as venture capital and other investors move to later stages of a company's life cycle, said Nehal Bhojak, director of the strategic life sciences initiative at Idea Foundry.
"The series A (investors) have become the series B (investors) now that there isn't a lot of money," she said. "Nondilutive grants are a way forward."
