A new kind of biotech upstart inspired by a top MIT finance professor just received a crucial validation, and rivals are now copying its strategy. BridgeBios CEO says its just getting started.
It wasn’t that long ago that the idea behind BridgeBio drew laughter from biotech and finance experts.
But these days, CEO Neil Kumar says he’s taking calls from industry insiders interested in launching companies emulating the BridgeBio model. If it helps patients, he’s willing to guide rivals.
The biotech, which was inspired by an influential MIT professor, is developing dozens of experimental treatments for rare or under-addressed diseases. These drugs are some of the more tricky products to bring to market, but BridgeBio believes it will reduce the risks if any one treatment fails by grouping them together. Individually, these drug candidates aren’t that appealing. Together, they have some promise.
Thea rest of the investment world is finally paying attention to BridgeBio’s approach. Biotech industry VC giant Flagship Pioneering announced last April that it would keep some of its biotech startups internal, creating its own hub-and-spoke venture. Venture firm Medicxi launched its own iteration of the model, Centessa Pharmaceuticals, earlier this month.
—Bruce Booth (@LifeSciVC) February 17, 2021
“It’s nice, obviously, seeing everyone doing these things and you hear them say, ‘We’re the BridgeBio of this region or this therapeutic area,” Kumar told Insider.
He added that the company’s structure is more productive than the more commonplace strategy of a venture capital firm launching many individual biotechs, building new teams and processes each time.
Palo Alto-based BridgeBio delivered its first drug to patients Friday, when the Food and Drug Administration approved Nulibry for an ultra-rare, fatal condition that causes brain dysfunction and seizures in babies and young children. It is the first treatment approved for the disease.
Ahead of the approval, Kumar spoke to Insider about the road to creating the hot new biotech model and the mistakes BridgeBio made along the way.
In its early days, BridgeBio was rejected by 200 investors and ran out of money three times
Understanding BridgeBio starts with MIT professor and founding investor Andrew Lo. In 2012, Lo published a proposal in the journal Nature Biotechnology to ignite risky early-stage drug development by pooling projects together with a financing “megafund” of nearly $30 billion.
“I would say that it was either totally ignored or the segments that did pay attention pretty much laughed at it,” Lo said of his original pitch.
But the idea resonated with Kumar, a former student of Lo’s and who was then a partner at biotech venture capital firm Third Rock Ventures. Kumar had been frustrated that much of the burgeoning research on genetic diseases was sitting on the shelf. A drug company might have one or two treatments in development for diseases that affect 500,000 people or fewer, but not the dozens of programs Lo imagined.
“That really freaked me out. I had never had that effect on a student,” Lo said of Kumar’s interest in his paper.
Kumar quit his job to start BridgeBio in 2015 and Lo invested a small amount of seed capital in the startup.
Kumar’s pitch got a similar response to what Lo had experienced years earlier. The startup was rejected by around 200 investors and ran out of money three times, Kumar said. But the market slowly came around, eventually making BridgeBio’s 2019 IPO one of the biggest that year.
To hear Kumar tell it, that struggle was critical to BridgeBio becoming what it is today.
“We started with an idea. People were sleeping on their couches, they were traveling around and pitching. And the only reason that that’s important is it imbues you with almost a religious sense of your mission,” he said.
BridgeBio’s first commercial product will stress test the company
BridgeBio’s flagship drug had been in development for several years when BridgeBio licensed it in 2018 from Alexion. It boosted patients’ survival in early testing, and later clinical trials would show that 84% of patients taking the drug lived to age 3, compared to 55% of patients who hadn’t taken the drug. But, it was set aside when Alexion decided to whittle down its R&D focus.
This kind of drug comes with many potential development headaches. Since the disease is so rare, BridgeBio had to look into alternative methods of running a clinical trial, relying on so-called natural history records of past patients in lieu of a placebo group. The disease is also underdiagnosed and the drug is challenging to manufacture, both of which make it a challenging commercial launch.
These are all likely issues BridgeBio will encounter with the products it has in development. The company plans to be a “repeat customer” in the rare disease field, Kumar said, making the relationships that its currently building with healthcare specialists, insurance companies and patient groups key down the road.
After fixing an early — and costly — mistake, BridgeBio is hitting its stride
Though a year’s supply of Nulibry will cost $500,000 wholesale, it is not a product that will lead to huge financial success. BridgeBio’s path to profitability is tied to its next drug, acoramidis, which is currently being evaluated by the FDA. That drug could be useful for more than 400,000 patients worldwide with a disorder called transthyretin amyloid cardiomyopathy, which can lead to heart failure.
Acoramidis is being developed under the subsidiary Eidos Therapeutics, which BridgeBio recently reacquired after spinning it out during a cash-lean time.
“That was a mistake,” Kumar said, adding that BridgeBio paid a heavy price to fix it: close to $1 billion in cash and stock, according to Endpoints (BridgeBio declined to disclose the total cost).
It’s only in the last six months, with Eidos back in the BridgeBio fold and a well-diversified drug pipeline taking shape, that the chief executive felt like everything was coming together for the young company.
By 2025, BridgeBio plans to have more than 30 drugs in development in areas such as hearing loss, cancer, autism and other conditions. Launching its first products this year will show what works for this type of large-scale, but specialized structure, and what needs to change.
“Now is that time to start building what was in that Nature biotech paper from Andrew [Lo],” Kumar said. “I don’t think I’ve seen that company built in this space, yet.”