John Simboli 00:00
Today I'm speaking with Cliff Stocks, founder and CEO of OncoResponse, headquartered in Seattle. Welcome to BioBoss, Cliff.
Cliff Stocks 00:08
Thanks, John. appreciate the invitation and am glad to be here.
John Simboli 00:12
What led you to your role as CEO of OncoResponse?
Cliff Stocks 00:15
Well, it was about a 30-year path in the making. I grew up in Wyoming, and spent a lot of time outdoors, heavy into biology. So when I went to the University of Utah, I studied molecular biology. At U of U, I did some work in an immunology lab for about seven years. I had a little stint out of three years, just kayaking and living outdoors and doing some fun things as a young man but then got back on track and went to the University of Chicago, and did my MBA. While I worked in Elaine Fuchs lab, as a cloner there, I learned to clone genes and was cloning for Lainey. This was back when cloning was yeoman's work. It was tough work because this was before PCR.
Once I completed my MBA, I was recruited by Booz Allen Hamilton, a consulting firm, to come over into their strategy practice and then their healthcare practice. But I was trying to get back to my love of biotech. I had the opportunity to join Icos Corporation with one of the luminaries of the industry, George Rathmann, who is also the founder of Amgen. I worked at I coast as the head of business development and strategy for 15 years. We were very science-oriented and very transactional. We did a lot of deals. One of those was a seminal deal between Icos and Eli Lilly, around a molecule that we had originated, tadalafil. And that ultimately led to the success of Icos, the launch of the drug Cialis, the profitability of Icos and the take out of Icos in 2007 by our partner Eli Lilly, at which time the former CSO of Icos and I spun out some technology into a NewCo, into a new company called Calistoga, got a venture-funded 51 million in and about four years later, with some phase 2 data. It was 600 million out with a trade sale to Gilead. And then my friend, Steve Gillis, recruited me over to a company that he needed some help with, a company called Theraclone, that had gone a couple of years without a CEO. So he brought me in to help shape that company up. We ran leadership and focused on some of the key assets there, got those to a stage where we could sell those to Gilead. And then I took that platform from Theraclone, a very interesting platform and founded OncoResponse. I'm sure we'll talk about that platform going forward.
John Simboli 02:34
Based on your experience, having been involved in companies that were successful, did you at any point think, well, this idea around OncoResponse seems rather interesting, but I know how hard it is to start companies and to have them succeed. I think I'll take this to an established company and ask them if they want to bring it in-house. Was that ever an option for you? Or did it need to start as a new company?
No, I felt it would need to start as a new company. These types of platforms, sometimes when they get sucked up into a pharmaceutical company, don't get the attention they need. They're not paying off right away, it takes years and a lot of capital to develop the platform to perfect it for oncology and then, ultimately, me to execute on it. So I felt that we needed a NewCo around this. I didn't do it in a vacuum, of course, I was talking to board members, talking to experts in the industry. Was this a good idea? Could we take a platform that had been very successful for discovering antibodies for infectious disease and turn that into a platform where we now, rather than screen those individuals who have some antibodies to an infectious agent, but rather, now, screen on cancer elite responders or cancer patients that had reached remission following immunotherapy. And following the advent of checkpoint inhibitors of anti-PD-1, anti-PD-L1, and CTLA-4 antibodies, we started seeing a lot more of these elite responders, or cancer patients that actually had a complete response and, in many cases, remission.
John Simboli 04:10
When you made that decision to move from the business development side and the building side, from that prism, and made that decision to become the leader, the founder, the leader, the CEO, what was that decision like? Was that an easy transition was a hard transition?
No, I had sequentially climbed the ladder, so to speak. At Icos, starting as a manager and went through director, senior director, vice president and ultimately you know, an executive vice president on the Management Committee there over a 15-year period. That was a nice track and offered me many different leadership opportunities. I had really gained my leadership chops, really understood how to build stories, how to recruit people, how to gain influence to make a project go. At Calistoga, while I was one of the founders, I was on the Icos side of that, when we spun it out and founded that, I became Chief Business Officer. And we recruited a really good CEO, who had the type of experience in hematological malignancies, from a commercial standpoint, that was really going to help the company. And I think that showed some leadership, as well, for me. I mean, it was kind of my baby, but I felt, hey, I want the very best people around my baby. And this is a really good person, I'm going to have fun working with her. And we did, we had a blast, and I learned some things about E-quotient from a female CEO. And had a terrific time. It was a short run for us, and a very successful one. So going from, you know, a business development person to a chief business officer. My primary skills are deal-making, understanding people, understanding how to drive projects, how to position those, how to do valuations, how to get the best valuation for an entity, and how to work within the confines of deal structure to be able to make that pay off best for a company. And that translated then into these earlier stage New Co’s, you know, companies that were preclinical, and then moving those into the clinic, and then trying to validate those types of assets so that they had value in the eyes of pharma, or the public markets,
John Simboli 06:33
When you realized that the time was right to become the founder and the CEO, did landing in that job, did creating that job for yourself, did that new way of working, thinking and just doing your job, did that hold any surprises for you? Or had you been far enough educated this whole process, you knew what you were going to deal with when you came in as CEO?
No, a lot of surprises. I mean, you get surprises all the time as a CEO, and you're working with drug development in science, and especially cutting-edge science. But the OncoResponse story wasn't just cut and clean. It was really an exploration of what were the best utilizations of this platform. This platform allows us to interrogate the entire adaptive immune system of a person who's had a very interesting immune response. And at the B-cell level, to be able to discover the actual B-cell that made an antibody that had an activity. And then from that B-cell, we can clone that B-cell or de-sequence its DNA. And then put that DNA into expression systems that allow us to study those antibodies further. And the way we do this differentiates us from a lot of other folks who do antibody drug development. And I had a really strong understanding of antibodies, immunology, antibody drug development, but the directions that we initially went with the platform proved not to be as fruitful as where we are today, working in the tumor microenvironment. Those early days, we were looking for that very magical antibody that bound, was cytotoxic to a tumor. And we found interesting antibodies, but nothing that met the criteria there. And as we worked within the platform, we saw this great opportunity to work into the tumor microenvironment, because that is where this immunosuppressive barrier is set up by a certain type of immune cells that are recruited there by the tumor. And we had some insight into that. And then also some insight into these elite responders, and how they might be making antibodies to their own immune cells that modulate those immune cells, such that we can make an immunosuppressive tumor microenvironment, one of pro-inflammatory, really turning a cold tumor into a hot tumor, so that the immune system has a better chance of killing that tumor.
Cliff Stocks 07:12
What were you hoping to achieve that could be done at OncoResponse and not at another company?
Well, we brought the platform for OncoResponse in from the previous company where I was also CEO, called Theraclone. And Theraclone had success with that platform in being able to find antibodies to infectious disease agents. And we knew this was a novel approach to try to think about how we would move into cancer oncology with this platform. So my initial instincts around creating a company around this where that, hey, it's never been tried, no one really has gone in and tried to understand and study exactly which antibodies in a cancer patient have been attacking cancer and then try to use those antibodies as a basis for therapeutics. And so I knew it'd be cutting edge to think about how we would move through that process. And I just didn't feel like there was any other company or outfit that would do it. It also took some real belief on the part of a couple of key board members of Theraclone who came across with me into OncoResponse to say that they would support this idea, help raise funds, make introductions where we needed those. We got a terrific introduction to MD Anderson Cancer Center, and put together a broad strategic alliance with MD Anderson. And that allows us to collect patient sample materials in a vast way to be able to get a lot of material very quickly, to have those patients' consents conducted efficiently, to be able to get IRB approval quickly. And then to get materials shipped to us so that we can process them in our screens. And that was a big benefit. I mean, we got to utilize the marquee of MD Anderson as a player in OncoResponse's efforts. And we had a lot of introductions to a lot of other folks who invest and were able to bring in an investment to start the company. Really, the company was started around an idea—a lot of companies are started with an asset. And we just had sketched out a platform, a process, a good team, and an idea about how we were going to execute on that. And we were able to convince a handful of investors to come along for the ride with us.
John Simboli 11:25
Several founders and CEOs I've talked to over the last two years said something along these lines: "When I would go into the office each day, my family had a sense of what I was doing. It wasn't a very defined sense, but they kind of pictured I was doing something scientific. And then when I was working from my home office a lot and we were sharing a space and they were seeing me they said, Mom, Dad, is that all you do? Do you just talk on the phone all day? Which sort of research is kind of what we do. But so when you get to that part of the question, what do you do all day? How do biopharma CEOs spend their time each day?
I've read a lot about this and I've had the benefit of working with a lot of CEOs as a consultant, as a young person growing up in the industry, and as a mentor to a lot of other CEOs. And I've kind of broken this down into a CEO's role, into five sort of key areas. The first is to set the strategy of a company. That's not done in a vacuum, it's not just the CEO, it's a lot of input from your team, from board members, from experts in the industry, from key advisors, consultants, and so you're setting a strategy. But once you've locked in on that strategy, then you've got to recruit the people to execute on that strategy, you have to understand their backgrounds, understand what they're going to bring to the table, and then do that recruiting to get those folks in house who are going to execute the strategy. And then recruiting is just, you know, an art in itself. The third part of the CEO's job is raising money. It's probably one of the most important parts of an entrepreneur's life in a small biotech company, especially where we're so highly capital intensive. Raising money is hard. I really respect people who are able to raise money, entrepreneurs, you know, no matter the amount, a couple million here, or, you know, like what we experienced in 2020, hundreds of millions. It's an art and you've got to be able to tell that story and convince people to come along on that ride with you. The fourth sort of category is telling the story and revising the story. It's talking about strategy, internal, external, telling it over and over again, revising it as you need it, getting feedback and, and making your story better all along the way. That's done in a team setting, generally, with your leadership team, you're bringing in ideas and thinking about which directions you can go, advancing your own internal activities, being very watchful of the external world, and looking at the competition. So that's a whole element of itself, of telling that story and revising that story. And then the fifth part is running the company. It's keeping people accountable, going through the processes of the corporation to make sure it's on track to deliver, setting out your timelines and your budgets and communicating those to the people that you report to, the board. And then holding yourself accountable and holding your team accountable. And then, admitting when things didn't go your way, pivoting, making adjustments where you need to along the way, and then just keep driving.
John Simboli 14:41
As a CEO, what have you learned about your, let's call it management approach, or the management style that says who you are, defines you and makes it work for you?
I've certainly got a style and it's one that's developed as open communication, transparency, teamwork, and a lot of delegation. I really want to hire people, delegate to them, their activities and rely on them to conduct those. I expect people to be honest and motivated. Those are key things. Skill sets can be built and can be bought. But I need folks who are honest, honest with themselves, honest with me, honest with the organization, who are motivated, who really love what they do, get up in the morning and are excited about trying to help patients, excited about what they're doing, who have the tenacity to be able to stay in this because it's a long game. Your wins come few and far between, but you keep driving on those wins, and you have an understanding of where you're going. I think those are the main things. I think you have to stay pretty upbeat as a CEO, you've got to always encourage other people and do a lot of coaching. I've, fortunately, had a lot of coaching experiences in my life, starting as a young person, coaching my high school wrestling team and coaching a lot of different people along the way, mentoring, helping with the Seattle CEO biotech roundtable, bringing new CEOs into the realm and helping them think about how to be a good CEO.
John Simboli 16:23
When you were eight, or nine, or 10, whatever, you pick the age that you could remember, and you had a sort of image of what you wanted to do when you grew up, probably like most of us, it was what we thought our parents probably wanted us to do. Can you remember that? And does that have anything to do with how your life is at this stage?
Between the ages of nine and 12, I was pretty dedicated to becoming a doctor. And that's kind of like, you don't really know what a doctor does, you don't really know the variety and number of different types of doctors or the practices of medicine. But I just wanted to be a doctor, I loved biology, I loved human anatomy and physiology and wanted to be a doctor. I also, because my father was learning to fly around that time, I thought, Oh, I could be, that'd be cool. I'd be an airline pilot, a commercial airline pilot. And then because I was very outdoorsy, and doing crazy things, climbing and being on whitewater rivers and things like that, I thought, Oh, I wonder how I could make a living doing this, maybe a stuntman in Hollywood. So I think today, I'm not a doctor, I don't even play one on TV, but I have a lot of doctors who I work with, and admire and work for the company. And really have a good sense of medicine from the entire aspect of what doctors do. I don't fly airplanes anymore. And I had my life as a stunt man doing a lot of crazy things in the outdoors. But, really I think I've accomplished what I set out
John Simboli 18:00
When people say who is OncoResponse? How do you like to answer that?
I say OncoResponse is a clinical-stage immunotherapy company focused on discovering cancer medicines, from patients or elite responders, patients who've had a remission, and we look at their immune system to determine what helped them get to that remission. And then we try to make medicine from those antibodies that we feel they made that modulate or change immune cells in their tumor microenvironment to allow for more cures, and better outcomes for cancer patients.
John Simboli 18:40
What do people tend to misperceive about OncoResponse? And how do you help them understand, No, it's actually this?
One of the bigger questions that come is why would individuals make antibodies to their own immune cells. And that's a valid scientific question. But we've known for eighty-some years that within the milieu of the cancer environment, there's a lot of inflammation going on, and there's a lot of activity by the immune system. And sometimes individuals break tolerance on their cells. And through that process, they're making regulatory antibodies that modulate these immune cells, and then cause those immune cells to do something different, and something that we want them to do. In our case, we focused on the myeloid compartment. So we focused on macrophages. We feel like macrophages are one of the bad actors in the tumor microenvironment and specifically, a type of tumor-associated immunosuppressive macrophage, called an M2 macrophage. And our goal is to make an M2 macrophage into a different type of macrophage which is M1, or a macrophage that is pro-inflammatory, a macrophage that secretes cytokines such as TNF alpha, IL6, the cytokines that help T cells activate, proliferate and create that hot tumor. So in the context of all of this activity, those T cells and macrophages can ultimately kill tumors.
John Simboli 20:10
Even after that, are there people who say, Ah, yeah, OncoResponse is an x company who said, no, no, we're actually a y company. Does that happen?
People who are astute in the field will say, Oh, I see you guys are doing microfluidic single-cell sequencing, you're looking at the full sequence of the immune repertoire and then trying to determine what's important. And that's partially true, we do look at the repertoire, but we are different from those companies that do microfluidic single-cell sequencing, and do a bioinformatics play toward finding an interesting antibody. All they have are sequences, and then they try to follow those sequences in a pattern through bioinformatics to determine whether or not something interesting is going on. And then once they determine what is that something interesting, they have to chase it down, recapitulate those antibodies, and then do further studies, just even to understand the mechanism, or the function of that antibody. The way we've designed our screens are, right up front, we get functional data on the antibodies we're screening. So we lay the repertoire of a patient out in plates, and these are clonal density of B-cells. And our core technology allows us to get those B-cells to grow, differentiate and shed antibodies at high enough concentrations in supernate, that we can screen directly on that particular B-cell. So you can imagine we take the entire 200,000 B-cells of a patient, and lay them out, one cell in a well. So we've compartmentalized the entire immune system. And then we're able to do our assays to look at the function of those antibodies. And we design those assays so that we initially look at binding, and then once we understand binding, we immediately look at the function of something that we're testing about that antibody. Does it do what we want it to do? And in the case of our lead antibody, OR2805, that question was does this antibody cause macrophages in a co-culture essay to produce these pro-inflammatory cytokines? And so once we see that part of the activity in our screens, we're able just to sequence that portion of the repertoire that is important. It's answered an important question for us. And so now we're just sequencing, maybe 100 antibodies, maybe less. And from that starting point, we already have some idea that it binds a macrophage, and causes that macrophage to secrete a cytokine. And we see that as important. So now let's study further. What is that antibody? What does it bind? What's its epitope? What's its mechanism? What's its function? How is it doing this? And all those studies come later. But we do have a bigger head start on those companies that simply do this type of activity through bioinformatics.
John Simboli 23:00
How does the pipeline express your vision for the company?
Our pipeline currently is focused on developing medicine by taking clues from these elite responders and focusing on the tumor microenvironment. And everything in the pipeline, currently, is focused on the tumor microenvironment. We have our lead antibody, OR2085. It repolarizes M2 macrophages into a pro-inflammatory state that's going to change the tumor microenvironment from a cold tumor to a hot tumor, it's going to help kill the tumor. Our antibody next in the pipeline is antiLILRB2. This is a validated target. I asked the team at some point I said, folks, we've got a lot of risk here. We're cutting-edge science, let's do something a little different. Let's find something that we know investors are going to believe in. And that's by looking at preclinical data, and understanding what targets might be important in this same function in the tumor microenvironment on macrophages. And so the team came back with a really nice target that had been validated by Merck in preclinical, subsequent to our work starting. Merck has shown a modest single-agent activity, but some very nice, objective response rates in combination with their Keytruda. So there are some hints there that this is an important target for macrophages. So we set about to make a superior antibody. My approach here was let's make a best-in-class antibody that we can now have to partner up with another big pharma and compete with Merck. And that's what we've done. We do have a lot of data that show that we have a superior antibody to Merck's antibody, and now we're moving that down towards the clinic so that we could prove that and then be able to partner up with someone else who wants to compete with Merck around that. Our other efforts in the company are all focused on the tumor microenvironment. So it really is a theme that we're running with, and our next steps are going to be beyond the myeloid compartment, beyond the macrophage. So we'll start looking at different types of immune cells that also play a bad actor role in the tumor microenvironment—immune cells, other dendritic cells or T-helper cells. There are other fibroblasts that also play some negative roles in the TME. And we're going to look at those mechanisms to try to determine if we can intervene in those and come up with some medicines that would also be helpful in repolarizing the tumor microenvironment from an immune suppressive state to a pro-inflammatory state. That's the theme of the company,
John Simboli 25:41
At this stage of OncoResponse's development, do you allow yourself to take a moment, take that breath and say, you know, if this company develops, as I hope it will, we're going to do some good in the world, we're going to change the lives of some patients? Or, is it so much focus that's required on the scientific puzzle that that part comes later?
This is a big bet. And this has huge potential. Checkpoint inhibitors, as a class, sell about just under $30 billion dollars, that's billion with a B, every year. So it's a huge class. As a category, it's not that effective of a medicine, it's about, across the board, 20% effective for cancer patients. Cancer is so important that it's become the standard of care, in first line, because if you can give someone immunotherapy and they have a response, it's generally a very good response. The reason that checkpoint inhibitors aren't fully effective is predominantly because of the immunosuppressive nature of the tumor microenvironment. And it is that problem that we focused on, how do we change that tumor microenvironment that allows either your adaptive immune system to kill the tumor, or your immune system that has been augmented by checkpoint inhibitors, this other medicine, to kill tumors. And it's a big bet. It's cutting-edge science, it's a deep understanding of oncology and deep understanding of immunology. But in a global context, think about it, that's $30 billion. This market is projected to be about $50 billion by 2025. That's about the time we're going to be launching. A $50 billion annual run rate at even like, say an 8x, multiple, that's $400 billion of value. And so that's what we're chasing. It's like how can we make a dent and an impact in cancer from a global standpoint, because our agents would be used across the board in all tumors, all solid tumors, for sure, potentially, in hematological. malignancies as well. They would change the nature of the tumor microenvironment, allowing people to get much better responses and cures. So it's a big bet. And it's a big outcome if we're right. And we're on the cusp of that now, we're in the clinic, with our lead antibody, we're just doing our dose escalation studies. And we're encouraged by what we're seeing, and we're going to keep moving this forward. 18 months to two years from now, we should have an idea if we were right.
John Simboli 28:24
When you think about it from a patient's viewpoint, if your work is successful, do you imagine that having a small change in the life of a patient with cancer, a substantial significant change?
I think any changes we can give to people to prolong life from cancer is substantial for them. Many people are looking to that next big event. And it's generally you know, older people with cancer. So they're looking to that next big event in their life that they'd like to see happen, whether that's a marriage of a child, graduation, some grandchildren being born, those types of things are super substantial for those patients. I can tell you from my experiences and successes in the past, there is no greater feeling than when a patient comes to you and says thank you for what you do. And they can describe for you what impact it had on their lives. It's something that makes you feel like hey, I'm on the right path. I chose the right profession for myself. And this is what gives me the energy to keep going even in the face of so many failures which we experienced in our industry. Today in cancer, we are doing better as an industry, in prolonging life. We've cured some cancers. Many hematological malignancies are no longer death sentences. We've reduced those to chronic diseases that someone can manage and live with and then die of something different than cancer. And so we have that same vision as an industry, as a company, myself individually, that hey, we can make this difference. We can keep working at this. It's really fascinating, you know, immunotherapy has been tried many, many times throughout the history of cancer. There's about a 40-year attempt using immunotherapy to change cancer. And we're just on the cusp of doing that, since the introduction of different cytokines and chemokines that can affect the immune system to kill cancer plus this whole category of checkpoint inhibitors has made a huge difference. And now we're just trying to take that incremental next step on the tumor microenvironment, to see if we can make a big difference, as well.
John Simboli 30:33
Are there broad questions having to do with biopharma that are particularly engaging to you right now, even over and above what you're working on?
An area that we're exploring, it's quite interesting to us, is the ability to engineer immune cells and put those back into the body to do what you want them to do, whether that's to kill a tumor or make a viable protein or what have you. We're just on the dawn of cell and gene engineering. It's an interesting area, it's an area that we are certainly paying attention to an area that we're beginning to explore the applications of our antibodies in that context, because these antibodies can help you target those types of cells to various locations. And then there are lots of methodologies by which you could engineer a macrophage to do something interesting in the tumor microenvironment
John Simboli 31:33
Cliff, thanks for speaking with me today.
John, it's been a real pleasure, really enjoyed the time we had today and hope it is encouraging and helpful for your listeners.