The Company's investment plan is based on the general rationale of the PDF program, which is to encourage the provision of patient equity capital to small and medium sized Australian companies. The Company's investment objectives are to identify entities which are developing technology driven medical research for life-science and health-care applications. Our investment approach is geared towards the construction of a diversified portfolio of 10-20 companies across a spectrum of activities and stage of development.
We spend considerable effort in ensuring we remain fully informed of new areas of interest - particularly where Australia may have an existing competitive position or track record. Examples of this includes medical devices, diagnostics, immunology and stem cell biology.
Investors should appreciate that the life sciences industry is a rapidly evolving system where change is a constant and a technology that is competitive today may very well be a broadly available commodity tomorrow.
We seek to invest in those companies that will create dramatic advances in their marketplace and have the potential to become industry leaders. Our forward thinking investment philosophy results in constantly evolving intelligence regarding those types of technologies that should be considered as desirable investment opportunities. Examples of the fields of interest include:
Post-Genomics
In the past few years much attention has been given to the sequencing of the human genome. A watershed achievement in the biological sciences, the thrust of research related to the genome has shifted and is now focused on attaining a comprehensive understanding of this vast reservoir of data and how to exploit and apply that knowledge to produce valuable therapies and diagnostics. Already the increased understanding of that sequence data is yielding many more potential targets for drug discovery.
An unprecedented opportunity to understand the genetic and molecular basis of disease is in parallel creating compelling investment opportunities in those companies developing post-genomics solutions.
Disciplines of interest include:
- Functional genomics: The identification of gene function and role in the disease process. Modern functional genomics approaches incorporate major advances in several different areas such as analytical biochemistry, image analysis and robotics to undertake the task on a much larger scale than was possible in the past.
- Transcriptomics: Involves the large-scale analysis of messenger RNAs (molecules that are transcribed from active genes) to determine when, where, and under what conditions genes are expressed.
- Proteomics: The study of protein expression and function to elucidate their role in the disease process. Because proteins are common drug targets, analysis of proteins is more direct than looking at their precursors, genes and mRNA.
- Structural genomics: Generating the three-dimensional structure of proteins to assist in the identification of the characteristics of compounds that will effectively interact with target proteins active sites.
- Glycomics: This field studies the biological function of carbohydrates and patterns of expression as modulated by the environment and the physiological state of the organism. Biologists are finding that minor differences in sugar structures can have a huge impact on biological functions.
- Pharmacogenomics: The analysis of genetic variations among individuals and the effect those variations may have on an individual's susceptibility to disease or response to treatment. The desired outcome of this field is to reduce clinical development times and costs, reveal new indications for existing drugs and ultimately generate personalized medicines.
Stem Cell Biology
Much research is being undertaken on cells that have the ability to differentiate into other cell types and used to regenerate damaged tissue and organs. The field is advancing at a rapid pace with new discoveries reported in scientific literature on a weekly basis. Broadly speaking, most research within the area is targeted at understanding the differentiation process in embryonic stem cells and adult stem cells.
This field of research has enormous implications for the future of medicine, from streamlining the drug development process to eventually developing cell therapies. In the future stem cells may be used to treat such conditions as Alzheimer's disease, Parkinson's disease and spinal cord injuries.
Whilst this area often sparks major ethical debate and can polarize the community with vastly different opinions and perceptions, we believe the tremendous benefit that research in this area offers mankind cannot be ignored. Australia is one of the world leaders in this area and so tremendous opportunities exist for investors.
Convergence
The rapid pace of advances in technology and science in recent years is driving a very powerful convergence of many previously discrete industries. Life science companies are increasingly becoming the innovators to develop technologies that act as a bridge between industries, and biology is serving as the inspiration for competing players within a number of industries to develop pioneering products that can give them an edge over the competition. It is resulting in a large number of new, hybrid products and applications that are superior in terms of speed, cost and quality, or even opening up entirely new markets.
We expect to invest in companies developing convergent technology platforms that are the leaders in the drive towards a single unified discipline incorporating sciences such as information technology, materials science, chemistry, physics and biology.
Examples of new convergent technologies emerging include:
- Biomaterials: A broad discipline that represents the interfacing of biology with materials science to develop materials with improved characteristics for a wide variety of applications. Some of these future applications are for drug delivery, disease detection and improved implants.
- Bionics: The science of constructing artificial systems that have some of the characteristics of living systems. Applications are cochlear implants, artificial limbs, artificial retinas and other augmentations.
- Biosensors: Biosensor technology is the coupling of biology with advances in microelectronics. A biosensor is composed of a biological component (such as an antibody), linked to a tiny transducer. The devices can be used to identify and measure substances at miniscule concentrations.
- Tissue engineering: Combining advances in cell biology and materials science is allowing scientists to create semi-synthetic tissues and organs in the lab. These tissues consist of biodegradable scaffolding material and living cells produced through cell culture. Tissue engineers have set out to grow virtually every type of human tissue, with the ultimate objective being to create complex organs composed of multiple tissue types. These could replace or repair diseased or failing organs. This field is barely a decade old but commercial skin products for wound treatments are already on the market.
- Systems Biology: Utilizing exponential advances in computing power and improved mathematical algorithms are cross-disciplinary groups of scientists attempting to build computational software that focus on the broader biological system and its components interactions.
- Microfluidics: Microfluidics fuses advances in microfabrication, materials science and fluidics. The end result is that minute amounts of fluids may be channeled around on a chip surface to perform experiments, resulting in order of magnitude improvements in time and cost.
Silicon Biology
Information technology has evolved to become an integral component of the modern drug discovery process, transforming and accelerating many steps in the pipeline that begins with basic research and concludes with disease specific pharmaceuticals. Indeed, due to the co-evolution of industrialization in the drug discovery process it would no longer be possible to manage and analyze the deluge of data that high-density experimentation generates without the aid of computers.
Therefore joining the lexicon alongside in vitro and in vivo is the term in silico, which literally refers to experiments taking place inside the computer. As the evolution of information technology continues, larger portions of the drug discovery process will make their way from the laboratory bench to the computer, streamlining the drug creation process and adding tremendous value.
Examples of this approach include:
- Structure-based drug design: In this approach chemists usually start with a characterized protein target for which they typically have a three-dimensional structure, obtained by methods such as X-ray crystallography, nuclear magnetic resonance (NMR) or computational prediction. Through the use of sophisticated computer modeling techniques chemists will attempt to design a molecule that binds to the active site and is selective against that drug target.
- Virtual Screening (VS): A Compound library is screened for leads by a computer model that assigns a score to molecules depending on their degree of affinity to a target. The compounds screened may be from a library that the company has synthesized or a virtual collection.
- Computational library design: Computational techniques to streamline the search for lead compounds through the design of efficient screening libraries. Computational modeling designs a library for maximal diversity with fewer compounds and then normally follows an iterative process to design focused libraries with properties similar to the best ones found in the previous screening.
- In Silico ADME/tox: Computer models predict the ADMET (Absorption, Distribution, Metabolism, Excretion and Toxicology) properties of new molecules.
Nanomedicine
Nanotechnology is beginning to allow scientists to work at the cellular and molecular scale to produce major benefits for the life sciences. Applications of the science will find some of their first applications in biomedical research and disease diagnosis. For example, nanoparticles considerably smaller than one micron in diameter are being used as a revolutionary way to deliver drugs into cells.
Future applications will be truly disruptive in their impact on industries value chains. We are closely following the progress of nanotechnology and will choose to invest in ventures with enabling platforms if they are sufficiently advanced to allow an exit within a reasonable time frame