The News S*BIO slashes staff in drastic revamp Nisha Ramchandani 657 words 3 September 2011 Business Times

Singapore STBT CTGDJC English (c) 2011 Singapore Press Holdings Limited The biotech firm, Singapore's first, says it's moving from an R&D organisation to one focused on products THE Republic's first biotech company, S*BIO, is slashing its headcount by 80 per cent as part of a restructuring exercise as it shifts its focus from research and development (R&D). 'In a way, we are changing the company from an R&D organisation,' Jan-Anders Karlsson, chief executive of S*BIO, told BT yesterday, adding that S*BIO is going from an R&D company to a productfocused one. Located within the Singapore Science Park II, S*BIO has a team of 40 staff here, most of whom are involved in R&D activities. The restructuring comes after S*BIO's partnership with one of its investors, US-based Onyx Pharmaceuticals, failed to make significant headway. In 2009, S*BIO entered into a deal with Onyx worth up to US$550 million to develop and commercialise two of S*BIO's JAK2 inhibitors, one of which is the compound SB1518. SB1518 inhibits the action of a protein enzyme called JAK2, which is linked to various cancers and auto-immune diseases. It is being tested on diseases such as myelofibrosis - a chronic condition where scar tissue develops in the bone marrow - and leukaemia. S*BIO has received payments of US$45 million from Onyx so far. Under the initial agreement, the US-based company had option rights to develop and commercialise both compounds in the United States, Canada and Europe while S*BIO would retain the rights for all other markets. However, since then, Onyx - which still holds a stake in S*BIO - went on to acquire bio -pharmaceutical company Proteolix Inc, which has a more advanced compound. 'They didn't have the human resources to push our compound (which) we thought was important,' Dr Karlsson said. As a result, Onyx and S*BIO ended up restructuring their agreement, giving S*BIO back the North American and European rights for the two compounds. S*BIO is presently on the cusp of conducting Phase 3 clinical studies for SB1518, which is expected to cost some US$50 million to US$70 million. It is looking to start the Phase 3 studies by late this year or early next year in the Americas, Europe and possibly Australia as well as Asia. Phase 3 studies - if successful - would be the last step before application for market approvals, whic h could see the drug released to market by 2014. One edge that the compound has over its competitors in development is that it doesn't have the side effect of negatively affecting the bone marrow, Dr Karlsson underlined. S*BIO is now looking for strategic partners to help it with funding of the Phase 3 trials, as well as with the commercialisation of the drug. While SB1518 is only one of several compounds that S*BIO has discovered here in Singapore, it has proved to be the most promising thus far. 'The team has been incredibly productive,' Dr Karlsson noted. Page 1 of 2 2011 Factiva, Inc. All rights reserved.

However, he acknowledged with regret that S*BIO has enough on its plate with SB1518. '(It's) important for us to focus on SB1518,' he said, later adding: 'We cannot handle more.' One possible option would be to sell the rights to the other compounds to investors and plough the funds back into the studies for SB1518. With staff count to be significantly reduced, S*BIO also plans to leverage on investigators to help it to conduct any studies going forward. Meanwhile, staff affected by the retrenchment will serve out a month with the company. S*BIO also hopes to help them to find other employment opportunities. DR KARLSSONS*BIO is on the cusp of conducting Phase3 clinical studies for its SB1518 compound, which is expected to cost US$50- US$70 million Document STBT000020110905e79300002

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