Access to multiple tranches of capital is critical for predominantly no revenue development stage biotech firms. While financing needs are monotonically increasing over multiple years in the product development approval cycle, the market for high risk, milestone driven biotech investment is significantly more volatile than the financial markets as a whole. In this paper, we analyzed the role and relative importance of global biotech IPOs, as well as other sources of capital such as strategic alliances, for research and development funding. We also explored and assessed the degree of mismatch between the access to capital, operational efficiencies, and how firms solve the potential unmet capital requirements. Implications for investors, as well as small and large biotech company managers, is discussed.

PurposeUsing a dynamic capabilities lens, this paper aims to study the impact of genomics generally and gene therapy specifically on the rare disease sector of the biopharmaceutical industry.Design/methodology/approachIn this study, 24 genomics-based, rare disease-focused biopharma companies were studied and several variables were tested with respect to enterprise value growth. The companies were analyzed as a group of rare disease firms, as well as by size.FindingsThe authors found that number of employees, revenues, number of pipeline and marketed products and retained earnings are strongly correlated (in that order) with enterprise value in rare disease focused biopharma companies. These correlations seem to be weaker as a company’s market capitalization size decreases, indicating that there tends to be increasing returns to scale.Research limitations/implicationsThis study found that increasing rates of cumulative returns to enterprise value growth depends on accumulating knowledge-based employees and expanding product portfolios of disruptive genomics-based technologies for treating rare diseases. Aggregating skilled and innovative employees (especially in bigger companies) can be seen as a cumulative bolstering factor in leveraging dynamic capabilities which can be recognized, understood and transformed into commercial success (i.e. increasing returns in enterprise value). In other words, technology managers’ job is to manage not only the financial aspects of the technology but also human resources, asset configuration and strategic alliances efficiently toward faster and better innovation. Strong dynamic capabilities can be formed with the accumulation of experience, articulation and codification of knowledge and an adaptive ability to change the way they solve problems as their environment transforms.Originality/valueThis is the first study to demonstrate and measure a relationship between dynamic capabilities and enterprise value in genomics-based rare disease firms. Further, this study highlights the importance of building the capability and capacity to absorb expertise and accumulate knowledge for new product innovations and sustainable competitive advantage in industries characterized by disruptive innovation.

Recessive Dystrophic Epidermolysis Bullosa (RDEB) is a severe genetic disorder characterized by large recurrent and chronic open wounds. RDEB patients lack functional type VII collagen (C7) owing to mutations in the gene COL7A1, the main component of anchoring fibrils (AF) required for epidermal-dermal cohesion. Over 700 alterations in COL7A1 have been reported to cause Dystrophic Epidermolysis Bullosa (DEB), which may be autosomal dominant or recessive. The most common subtypes are dominant DEB (DDEB), recessive DEB severe (RDEB-GS), and recessive DEB generalized other (RDEB-GO). Mutation type correlates with defects in C7 with a resulting mild, moderate or severe phenotype. To date, the widely estimated incidence (0.2-6.65 per million) and prevalence (3.5-20.4 million) of RDEB has been extrapolated from limited clinical databases or registries. Using a genetic modeling approach, we use whole exome and genome sequencing data to estimate the allele frequency of pathogenic variants. Through the ClinVar and NCBI database of human genome variants and phenotypes, DEB Register and analyzing premature COL7A1 termination variants we built a model to predict the pathogenicity of previously unclassified variants. We applied the model to over 60,000 sequences from the Exome Aggregation Consortium (ExAC) and Genome Aggregation Database (gnomAD) and identified 523 variants which were classified as pathogenic for RDEB, including 5 dominant mutations. From these, we estimate the incidence of RDEB is 95 per million, or 30 times the National Epidermolysis Bullosa Registry (NEBR) estimate. We estimate 19,000 individuals affected with RDEB were born since 1960 in the U.S., and over 24,000 in the European Union, 2% with the RDEB-GS subtype. We conclude using genetic allele frequency enhances estimation of patients who may benefit from COL7A1-directed therapies.

Shaundra Eichstadt Jean Y Tang Daniel C Solis Zurab Siprashvili M Peter Marinkovich Nedra Whitehead 3 Matthew Schu 3 Fang Fang Stephen W Erickson Mary E Ritchey 3 Max Colao Kaye Spratt 4 Amir Shaygan Mark J Ahn 5 Kavita Y Sarin 1 1Stanford University School of Medicine, Department of Dermatology, Redwood City, CA 94063, USA; 2Veterans Affairs Medical Center, Palo Alto, CA, USA; 3RTI International, Research Triangle Park, NC, USA; 4Abeona Therapeutics, New York, NY, USA; 5Department of Engineering and Technology Management, Portland State University, Portland, OR, USA Background: Recessive dystrophic epidermolysis bullosa (RDEB) is an inherited genetic disorder characterized by recurrent and chronic open wounds with significant morbidity, impaired quality of life, and early mortality. RDEB patients demonstrate reduction or structural alteration type VII collagen (C7) owing to mutations in the gene COL7A1, the main component of anchoring fibrils (AF) necessary to maintain epidermal-dermal cohesion. While over 700 alterations in COL7A1 have been reported to cause dystrophic epidermolysis bullosa (DEB), which may be inherited in an autosomal dominant (DDEB) or autosomal recessive pattern (RDEB), the incidence and prevalence of RDEB is not well defined. To date, the widely estimated incidence (0.2–6.65 per million births) and prevalence (3.5–20.4 per million people) of RDEB has been primarily characterized by limited analyses of clinical databases or registries. Methods: Using a genetic modelling approach, we use whole exome and genome sequencing data to estimate the allele frequency of pathogenic variants. Through the ClinVar and NCBI database of human genome variants and phenotypes, DEB Register, and analyzing premature COL7A1 termination variants we built a model to predict the pathogenicity of previously unclassified variants. We applied the model to publicly available sequences from the Exome Aggregation Consortium (ExAC) and Genome Aggregation Database (gnomAD) and identified variants which were classified as pathogenic for RDEB from which we estimate disease incidence and prevalence. Results: Genetic modelling applied to the whole exome and genome sequencing data resulted in the identification of predicted RDEB pathogenic alleles, from which our estimate of the incidence of RDEB is 95 per million live births, 30 times the 3.05 per million live birth incidence estimated by the National Epidermolysis Bullosa Registry (NEBR). Using a simulation approach, we estimate a mean of approximately 3,850 patients in the US who may benefit from COL7A1-mediated treatments in the US. Conclusion: We conclude that genetic allele frequency estimation may enhance the underdiagnosis of rare genetic diseases generally, and RDEB specifically, which may improve incidence and prevalence estimates of patients who may benefit from treatment.

The multinational biopharmaceutical industry has to deal with significant financial pressures due to being a very cost-constrained and highly regulated industry. To add to that, finite patent expirations on financially successful drugs, vying nature of the biotech industry due to new innovations. There has been an increase of smaller markets due to the proliferation of molecular segmentation patient populations in fields such as personalized medicine. Particularly, due to the significant cost reducing impacts of the development of "next-generation" sequence platforms on DNA sequencing in the last decade, molecular diagnostics are being considered as cost effective candidates to be used as a standard medical test, in terms of risk assessment, confirmation of diseases, and therapeutics. Biopharmaceutical companies need to reassess their drug development strategies and choose among alternative prospective business models in order to remain relevant amid the new innovations and developments. Using a dynamic capabilities lens, this paper tends to study the impact of genomics generally and gene therapy specifically on the rare disease sector of the biopharmaceutical industry by analyzing the public data from 24 genomics based rare disease focused biopharmaceutical companies. This study shows that growing rates of cumulative returns is dependent upon the accumulation of knowledge-based employees and expanding product portfolios of disruptive genomics-based technologies for treating rare diseases. Further, this study stresses the significance of structuring the capability and capacity to absorb expertise and accrue knowledge for new product innovations and viable competitive advantage.

Abstract Background : The distinction between HER2-positive (IHC 3+ or 2+ with FISH ratio >/= 2) and not overexpressing HER2 has been the focus of many diagnostic tests over the past years in association with development of HER2-targeted therapies. The paucity of therapies developed for the low to intermediate HER2 protein expression populations has resulted in limited attention to their diagnostic precision and accuracy. The development of NeuVaxTM (nelipepimut-S; Galena Biopharma, Inc.) in the defined population requires a HER2 IHC 1+/2+ diagnostic that precisely and accurately ensures identification of targeted patients. We describe discordance rates between local and central testing performed to identify tumors with HER2 IHC 1+/2+ expression that supports the development of a method to validate HER2 1+ and 2+ (FISH < 2.2) patients who receive nelipepimut-S adjuvant therapy. Methods : The Prevention of Recurrence in Early Stage, Node-Positive Breast Cancer with Low to Intermediate HER2 Expression with NeuVaxTM Treatment (PRESENT) study, is a multicenter, multinational, prospective, randomized, double-blind, controlled Phase 3 study assessing efficacy and safety of the peptide vaccine nelipepimut-S, in HLA A2 or A3 positive patients with early stage, node positive breast cancer expressing low and intermediate levels (IHC 1+/2+) of HER2 protein. PRESENT 2-step screening includes HLA testing and central lab confirmation of HER2 1+ or 2+ expression using the DAKO HercepTest. Results : As of 2 June 2014, 1454 patients underwent central IHC testing for HER2 and had a quantifiable result of 0, 1+, 2+, or 3+ for both local and central test. Per local testing, 61% (HER2 1+, n=612; HER2 2+, n=275) were eligible and 39% (HER2 0, n=468; HER2 3+, n=99) were ineligible. Of those eligible by local testing, 67.5% (n=599) were confirmed as eligible per central testing for a discordance rate of 32.5% (n=288). Of the 288 discordant samples tested centrally, 73.6% (n=212) and 26.4% (n=76) were reported as HER2 0 and 3+, respectively. 8.7% (76/877) of patients found to be HER2 1+ or 2+ by local testing were determined to be HER2+ (IHC3+) by central testing. Conclusions : Current tests for HER2 expression are defined by their ability to determine 3+ positivity, yet significant discordance still occurs with nearly 9% false negative rate in this trial. Similarly, marked discordance exists between local and central laboratory test results for HER2 by IHC at 1+/2+ levels of expression. The relatively high discordance rate observed may be due, in part, to the lack of a validated IHC assay for low-to-intermediate expression of HER2 (0, 1+, and 2+). In order to improve accuracy of testing and to develop a companion diagnostic for nelipepimut-S, the Leica Bond Oracle HER2 IHC System has been validated to determine samples across the IHC spectrum (0, 1+, 2+ and 3+) and is now incorporated into HER2 screening for the PRESENT trial as a companion diagnostic to increase accuracy, precision, and specificity in discerning HER2 1+ and 2+ patients. Citation Format: Michelle Melisko, Elizabeth A Mittendorf, Sufia Safina, Michael Schenker, Murray A Brunt, Maria Litwiniuk, John Mackey, Katarina Petrakova, Svitiana Alieva, Lacey Chance, Gavin S Choy, Mark Ahn, Adamm Hamm, Sonia Kumar, Hope S Rugo. HER2 discordant results in local vs. central testing in the phase 3 nelipepimut-S trial and implementation of Leica Bond Oracle HER2 Immunohistochemistry (IHC) System for low and intermediate levels (1+, 2+) of HER2 protein expression as a companion diagn [abstract]. In: Proceedings of the Thirty-Seventh Annual CTRC-AACR San Antonio Breast Cancer Symposium: 2014 Dec 9-13; San Antonio, TX. Philadelphia (PA): AACR; Cancer Res 2015;75(9 Suppl):Abstract nr P2-15-02.

New creative approaches are needed to manage emerging biotechnology innovations, regulations, and payor environments to enhance product pipeline productivity, valuation, and risk management. Biopharmaceutical firms must make dynamic resource allocation decisions on their relative levels of internal R&D and external strategic alliances in furthering their pipelines. As the predominant method of using discounted cash flow (DCF) methodologies may lead to chronic underinvestment and performance, we evaluated the integration of traditional DCF with an effectuation model of analysis. Unlike traditional financial models that begin with the end goal of assumed known cash flows and recursively solve for portfolio optimization, the effectuation model—means, affordable loss, partnerships, and expect the unexpected—begins with resources that are readily available to the firm and then seeks to maintain strategic flexibility to take advantage of environmental contingencies as they arise. Using effectuation principles can provide insight into optimizing pipeline decisions by focusing on the logic of control rather than the logic of prediction. Using empirical data, we found that investors were able to effectively differentiate between the pipeline values of among companies. Overall, these results suggest that the integration of effectuation and DCF provides a lens from which to explore emerging varieties of small and large company innovation in the biopharmaceutical industry.

Using an effectuation theory lens, we study reverse stock splits in the biotech industry where significant uncertainty makes specific scenarios of success difficult to predict. We conjecture and find that, in contrast to other environments where there is less uncertainty, reverse stock splits in the biotech industry are followed by positive abnormal returns over the subsequent 1- to 12-months. Also consistent with our effectuation-based predictions, we find that these returns are positively related to the reverse split ratio, size, cash holding, and long-term debt, and negatively related to the market-to-book ratio and firm age. We also find that liquidity increases after a reverse stock split. These results suggest that the concept of effectuation theory is better suited to analyzing reverse stock splits in the biotech industry.Â

This study explores how new ventures access advice to achieve high growth and sustainable performance. A relational model of three important themes — compliance (regulatory and legal governance), contacts (networks of suppliers, customers, investors), and content (strategic insights) — emerged as critical to any sustainable high-growth effort. Our findings suggest that advisory boards and boards of directors have a significant role in managing and creating value for emerging high-growth firms due to inherently high failure rates, technological complexity, and market risk — all of which requires access to external resources.

Purpose– The popular use of labels such as Baby Boomers, Generation X, Generation Y and Millennials suggests that the nature of effective leadership changes over time in response to the prevailing modern context. Using a values-based leadership lens, defined as the moral foundation underlying stewardship decisions and actions of leaders, the purpose of this paper is to explore the alternative notion that fundamental leadership ideals – from antiquity to modern executives to MBA students – are timeless in nature.Design/methodology/approach– Using a thematic analysis approach,The Aeneidwas coded for key leadership themes (integrity, good judgment, leadership by example, decision-making, trust, justice/fairness, humility, and sense of urgency); and a mixed-method research framework was employed to juxtapose the leadership lessons identified to the demands of modern leadership. Deductive thematic analysis was utilized to examine key themes from responses of 13 multi-sectoral leaders (for profit, non-profit, government) and 137 MBA students (from three MBA programs in differing regions).Findings– Whether viewed qualitatively or quantitatively, or across sectors, the findings of this study affirm the explicit relevance ofThe Aeneidto the demands of modern leadership. Additionally, it was found that the way managers ranked leadership values was not significantly different from how MBA students ranked the same values. Moreover, the authors found integrity to be a superordinate value – without which the remaining values have far less significance.Originality/value– This research highlights a leadership paradox – while managerial traits are an important consideration for the prevailing operational context in the short term, a values-based approach to hiring, promoting and retaining leaders may be superior in achieving organizational sustainability and performance. This study illustrates the practical contemporary relevance ofThe Aeneidspecifically, and illustrates a humanities laden and values-based approach to reflecting on leadership effectiveness generally.

PurposeThe purpose of this paper is to investigate the role of cultural intelligence in MBA curricula. Shaping global corporate culture that manifests itself in powerful‐shared values, group behavior, and persists despite changes in‐group membership is decisive to organizational performance. In turn, cultural intelligence (CQ), defined, as an individual's capability to function and manage effectively in culturally diverse settings, has recently emerged as a likely indicator of management ability and leadership potential.Design/methodology/approachThe authors utilized the Cultural Intelligence Scale (CQS) – metacognitive, cognitive, motivational, and behavioral – to capture data from MBA students attending three universities in the USA.FindingsThese results, coupled with the open‐ended survey responses, suggest that in general the students have a firm understanding on why CQ is essential in an increasingly globalized business world, as well as a strong desire to interact with other cultures. However, although students appear highly motivated to study about other cultures, the results indicate that many of the MBA students lack an in‐depth knowledge of the values, beliefs, and practices of other cultures. Further, the data suggest that the most important attributes that increase an individual's CQ are international work experience, learning an additional language other than English, and/or obtaining an undergraduate degree from a foreign country.Originality/valueThis is the first empirical study to examine the role of cultural intelligence in MBA curricula.

Disruptive technology platforms from emerging companies hold great promise for exploiting innovation, but often face legitimacy hurdles due to their liability of newness. Nascent firms must learn new roles with limited precedent, and establish ties with an environment that may not fully understand or value their existence. Using a legitimacy-based lens in the context of the biotechnology industry, we posit a sequential construct - cognitive, regulative, and normative legitimacy - to evaluate emergent technology platforms. Our model of biotechnology platform emergence may provide insights for understanding how breakthroughs achieve legitimacy in the scientific community, mobilize resources and talent, and attain commercial success.

PurposeThe purpose of this paper is to investigate the gap between the resources required to build a strong biotechnology ecosystem in Nebraska and the perception of resources currently available within the state for doing so.Design/methodology/approachUsing resource‐based theory along with data from a Battelle survey commissioned by BioNebraska, the authors first identify the human and financial capital needed to support a viable biotechnology industry sector, benchmarking with other regions currently undertaking such development. The authors then compare identified resource requirements with data from a survey of BioNebraska members regarding their perceptions of the importance of these resources to, and their availability within, Nebraska.FindingsThis process revealed gaps in several key resource areas that could impede the state's ability to achieve its sector development goals.Practical implicationsIn the authors' view, understanding the gap between resources required and resources available for building a high technology industry sector, as well as benchmarking against the competition, are key first steps in developing successful economic policy.Originality/valueThe paper discusses the implications of gaps in several key resource areas for future success and makes recommendations for possible ways in which Nebraska decision makers might develop necessary resources. Also addressed is the importance of considering the perceptions of key stakeholders and decision makers regarding the resources required for developing knowledge industries such as biotechnology.

While there has been significant progress in advancing novel immune therapies to the bedside, much more needs to be done to fully tap into the potential of the immune system. It has become increasingly clear that besides practical and operational challenges, the heterogeneity of cancer and the limited efficacy profile of current immunotherapy platforms are the two main hurdles. Nevertheless, the promising clinical data of several approaches point to a roadmap that carries the promise to significantly advance cancer immunotherapy. A new annual series sponsored by Arrowhead Publishers and Conferences aims at bringing together scientific and business leadership from academia and industry, to identify, share and discuss most current priorities in research and translation of novel immune interventions. This Editorial provides highlights of the first event held earlier this year and outlines the focus of the second meeting to be held in 2013 that will be dedicated to stem cells and immunotherapy.

Stakeholder management is an important and common practice in any project, as it allows managers to better manage process, performance and risk. In virtual projects, collaboration and engagement with stakeholders is relatively more complex, challenging, and critical for project success. This paper proposes a novel stakeholder engagement process, focused on proactive stakeholder management in virtual projects. The proposed process is described and illustrated on a public sector project case in New Zealand. Using this process, the stakeholders of this project were able to discuss differing views on the project initiative and collaboratively reach mutually agreeable project objectives. The process can be applied by managers to better engage key stakeholders to ensure their intent is effectively communicated at the interpersonal and group levels.

Purpose - The purpose of this paper is to investigate the gap between the resources required to build a strong biotechnology ecosystem in Nebraska and the perception of resources currently available within the state for doing so.Design/methodology/approach - Using resource-based theory along with data from a Battelle survey commissioned by BioNebraska, the authors first identify the human and financial capital needed to support a viable biotechnology industry sector, benchmarking with other regions currently undertaking such development. The authors then compare identified resource requirements with data from a survey of BioNebraska members regarding their perceptions of the importance of these resources to, and their availability within, Nebraska.Findings - This process revealed gaps in several key resource areas that could impede the state's ability to achieve its sector development goals.Practical implications - In the authors' view, understanding the gap between resources required and resources available for building a high technology industry sector, as well as benchmarking against the competition, are key first steps in developing successful economic policy.Originality/value - The paper discusses the implications of gaps in several key resource areas for future success and makes recommendations for possible ways in which Nebraska decision makers might develop necessary resources. Also addressed is the importance of considering the perceptions of key stakeholders and decision makers regarding the resources required for developing knowledge industries such as biotechnology.

This study reviews the literature involving critical factors contributing to university technology transfer office success and then examines those factors within a stratified sample of four comparative case studies of peer university technology transfer offices. Two models of relative success and failure emerged, based on similarities and differences along the eight factors identified in the literature. Two additional success factors emerged during the course of the research. The ways in which technology transfer offices organised the commercialisation process, along with the degree of focus on both internal and external website utility, also seemed to play a significant role in university technology transfer office success.