SI
SI
discoversearch

Technology Stocks : New Technology

 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
From: FUBHO3/7/2016 7:34:28 PM
1 Recommendation

Recommended By
Glenn Petersen

   of 323
 
A Biotech Evangelist Seeks a Zika Dividend

A diverse biotechnology company hopes its genetically engineered mosquitoes
can help stop the spread of a devastating virus. But that’s just a start.

By ANDREW POLLACK
MARCH 5, 2016
nytimes.com

WEST PALM BEACH, Fla. — In the expanding realm ruled by Randal J. Kirk, sliced apples don’t brown. Salmon grow twice as fast without swimming upriver to spawn. Beloved cats are reborn.

And male mosquitoes are unleashed with the sole mission to mate, pass on a gene that kills their offspring, and die.

A few decades ago, the foods and creatures nurtured by Mr. Kirk would have been found only in dystopian fantasies like those written by Margaret Atwood. But Mr. Kirk’s company, Intrexon, is fast becoming one of the world’s most diverse biotechnology companies, with ventures ranging from unloved genetically engineered creatures to potential cancer cures and gene therapies, gasoline substitutes, cloned kittens and even glow-in-the-dark Dino Pet toys made from microbes.

Until recently, Mr. Kirk, 62, was a relatively unknown, self-made billionaire, buying up or investing in companies in the biotech world. So when Intrexon acquired the British company Oxitec last summer, it attracted little attention as he extended his reach into genetically modified insects.

An Oxitec worker puts her hand in a cage full of genetically modified male mosquitoes to show that they do not bite.CreditAndrew Testa for The New York TimesBut that move has thrust Mr. Kirk into the forefront of a scramble to control the Zika virus, suspected of causing babies to be born with tiny heads and damaged brains. It is rampant in Latin America and threatening the United States.

While Zika was not on his radar when the deal was announced, Mr. Kirk now appears to be the prescient owner of a potential bioweapon — Oxitec’s genetically engineered mosquitoes, which he says could save millions of people from Zika by causing the population of wild disease-transmitting mosquitoes to self-destruct.

“I think that we have the only safe, effective, field-proven and ready-to-deploy solution,” Mr. Kirk, who is usually called R.J., said in an interview in his office here overlooking the Intracoastal Waterway. In Piracicaba, Brazil, the population of wild mosquitoes has fallen 82 percent in the neighborhood where the mosquitoes are being tested, he said.

If his plans to sell the engineered mosquitoes succeed, Mr. Kirk will fortify his near cultlike status among some investors and colleagues who marvel at his shrewd (and somewhat lucky) investments.

Perhaps more important, a victory against the rapidly spreading epidemic could weaken opposition to genetically engineered organisms of all sorts, propelling many others out of the lab, onto the dinner table or into the environment.

Now Mr. Kirk must persuade federal agencies, foreign governments and nonprofit health organizations to place orders. He must counter caution from the World Health Organization and federal officials, who question whether the technique will be effective on a large scale. And he must overcome qualms about genetic engineering that have prompted opposition to the mosquitoes in the Florida Keys and elsewhere.

“We don’t have experience about living transgenic mosquitoes in the air,” said Dr. Artur Timerman, an infectious disease specialist in Brazil. “What will be the midterm or long-term consequences of this?”

Mr. Kirk is assembling a powerful lobbying effort, employing the law firm Sidley Austin in Washington as well as relying on one of Intrexon’s board members, Cesar Alvarez, the senior chairman of the prominent law firm Greenberg Traurig, and Intrexon’s head of corporate communications, Jack Bobo, who once directed biotechnology trade policy at the State Department.

Dr. Luciana Borio, acting chief scientist at the Food and Drug Administration, told a House subcommittee on Wednesday that the agency was “greatly expediting” Oxitec’s application to test the mosquitoes in the Florida Keys and would issue a draft environmental assessment very soon.

But when asked by Representative Morgan Griffith, a Republican who represents the Virginia district in which Mr. Kirk has a farm, Dr. Borio said the F.D.A. would not eliminate the opportunity for the public to then comment on the draft.

“What we don’t know right now is where the public stands on this in the setting of Zika,” she said later in the hearing.

Selling his mosquitoes to combat an international epidemic could help relieve the pressure Mr. Kirk is under to prove that Intrexon is more than just a collection of odd science projects, and that it can actually make money and fulfill his vision for a new golden age of biotechnology.

He considers this time to be a seminal moment in history, one in which the rapidly improving ability to read and write — and rewrite — the DNA code of life will make it possible to engineer all manner of organisms to perform specific tasks.


“I think this is the most significant industrial vector to occur in history,” he said, comparing it to semiconductor technology that gave rise to smartphones and the web.

And the same DNA tools can be applied to numerous areas. Intrexon’s scientists, he says, “don’t care if they are working on a primary human T cell or an avocado.” Reflecting that vision, Intrexon uses the web domain name dna.com.

The engineering of life is often called synthetic biology, a vaguely defined term meant to convey more systematic genetic manipulation than the cutting and pasting of a single gene that gave rise to early biotechnology companies like Amgen and Genentech. At its most distant point, synthetic biologists would sit at a computer designing life forms from scratch, then hit “print” and have the necessary DNA made to order to be inserted into a cell.

Numerous companies are moving into the field, but Intrexon is “literally the elephant in the room of the synthetic biology industry,” said John Cumbers, chief executive of SynBioBeta, a fledgling trade group.

His supporters say that if anyone can pull off such an enterprise it is R. J. Kirk, whom they call an uncommon visionary and quick study, though he lacks formal training in science. When Mr. Kirk tells people, as he often does, that he is just a country lawyer, they know they’re about to get a schooling in biology or business, interlaced with references to history, philosophy and opera.

“He has an astonishing grasp of science,” said Dr. Samuel Broder, a former director of the National Cancer Institute who now runs Intrexon’s health division. Dr. Broder recalled one instance in which it took him a day to understand the intricacies of a genetic disease. Mr. Kirk, after hearing Dr. Broder’s explanation, got it in five minutes.

Even the hedge fund manager Thomas U. Barton, who made his mark as a skeptical short-seller, gushes. “He understands all businesses,” he said.

Still, there are skeptics. It is hard to judge the strength of Intrexon’s core technology, known as UltraVector, which is a computerized system for putting together modular DNA pieces to make complex genetic circuits. The company, saying it wants to protect its trade secrets, has not published articles about it in scientific literature. Some start-up companies, not Intrexon, have taken the lead in the hot new genome editing technique called Crispr.

The biggest criticism is that Intrexon keeps announcing new acquisitions and new collaborations, dozens of them in all. Yet no product made with the company’s technology has reached the market, and it is not clear when any will.

“There’s a mixture here of spectacle and speculation,” said Jim Thomas of the nonprofit ETC Group, which says that synthetic biology needs to be more rigorously regulated. “What’s curious about this is the way in which they are putting together all these controversial and often failing one-trick companies and trying to wrap them up in a fancy synthetic biology front.”

Intrexon’s shares have fallen to about $37 from near $70 in July, though biotech stocks in general have also fallen. The company’s market value is $4.3 billion, making Mr. Kirk’s 53 percent worth over $2 billion.

One big commercial opportunity could be Intrexon’s pilot project to use genetically altered microbes to turn natural gas, which is cheap and abundant, into isobutanol, a liquid fuel that can be used in cars. Investors want to see if Intrexon’s partner, the energy giant Dominion, commits to building a commercial plant, which Mr. Kirk hopes could happen as early as this year.

And the Oxitec mosquitoes, while not something Intrexon developed itself, offer a bonus that Mr. Kirk could not have predicted. The mosquitoes were developed mainly to fight dengue fever, and that alone, Mr. Kirk said, made it worthwhile to pay about $160 million for Oxitec.

But because Zika is spread by the same type of mosquito, the Oxitec insects, which contain a lethality gene — can be used. When the male mosquitoes are released to mate with wild females, the offspring die before reaching adulthood.

A Mosquito FactoryIntrexon is now building a factory in Piracicaba to produce 60 million male mosquitoes a week, enough to protect at least 300,000 people, and Mr. Kirk believes production could be increased to cover entire cities or countries.

Costs may vary, depending on the concentration of mosquitoes, Mr. Kirk said. At $7.50 a person, which Technology Review magazine reported would be the price in Piracicaba, protecting a city of one million people would cost $7.5 million a year.

But some experts say it will take a lot of time and money to scale up, and that it is not clear if the technique reduces disease transmission.

And there are other new competing techniques for mosquito control that do not involve genetic engineering and therefore may have a quicker acceptance. One, pushed by the International Atomic Energy Agency, sterilizes lab mosquitoes with radiation so they can’t reproduce when they are released.

Mr. Kirk dismissed concerns about the Oxitec mosquitoes. They contain a few well-characterized genetic changes, he said, while radiation produces “millions of unknown mutations.” Regulators giving sterilized mosquitoes a lower hurdle is tantamount to “giving an award for ignorance,” he said.

In asserting that opposition to genetic engineering was “mostly born of fear based on lack of knowledge,” Mr. Kirk contended that synthetic biology was “not optional” if society wanted to maintain its living standards. If that sounds like something Monsanto, the leader in biotech crops might say, it could be because Mr. Kirk recruited Robert B. Shapiro, former chief executive of Monsanto, to be Intrexon’s lead outside director.

Among the better-known products Intrexon is preparing for market is the genetically engineered apple that resists browning when sliced, which Intrexon acquired when it bought Okanagan Specialty Fruits last year. The company plans to start sales next year.

Intrexon also owns a majority stake in AquaBounty Technologies, whose fast-growing salmon is the first genetically engineered animal to win federal approval for a spot on American dinner plates. Mr. Kirk “basically saved the company,” which was in danger of running out of money, Ronald L. Stotish, the chief executive of AquaBounty, said.

Mr. Kirk’s progression to biotech mogul was almost by chance. An Air Force brat who grew up in various states, He said he spent some of his teenage years playing guitar in clubs but grew disenchanted with the prospect of a musician’s life.

After studying business at Radford University, he embarked on his first venture, a television station in rural Virginia, while still in law school. He eventually gave up on that but not before moving to tiny Bland, Va., where he was the town’s only lawyer. The town’s only pharmacist, John Gregory, enlisted him in 1983 to start a drug distribution business, General Injectables and Vaccines. It was sold for $65 million in late 1998.

Mr. Kirk’s biggest score was New River Pharmaceuticals, which was developing a stimulant to treat attention-deficit hyperactivity disorder that was supposed to be less susceptible to abuse than existing products. While regulators ultimately deemed the drug no less prone to abuse than other products, Shire acquired New River for $2.6 billion in 2007 and made the product, Vyvanse, the successor to Adderall XR, which was losing patent protection. Mr. Kirk, who owned about half of New River, became a billionaire.

A similar pattern occurred with Clinical Data, which was trying to develop a genetic test to predict which patients would be most likely to benefit from the company’s experimental antidepressant. The genetic testing did not work but the antidepressant was approved anyway, and Clinical Data was acquired by Forest Laboratories for $1.2 billion.

“I would never bet against R. J. Kirk,” said Fred Koller, a former Intrexon executive. “It’s not necessarily the starting point that is successful, but he always gets there.”

‘Mutual Predators’Named for parts of genes called introns and exons, Intrexon was founded in 1998 by Thomas D. Reed and his wife, Jackie, to supply DNA constructs for research with genetically engineered mice. The company moved in 2004 to Blacksburg, Va., to take advantage of economic incentives and landed in the orbit of Mr. Kirk’s investment firm, Third Security. Mr. Kirk envisioned applications for the technology far beyond mice, investing $300 million and assuming control of the company. He took Intrexon public in 2013.

“My impression of R. J. has pretty much stayed one of perpetual awe,” said Dr. Reed, who is Intrexon’s chief science officer. “I joke that he is a mix of Leonard Cohen and Prince,” he said, combining a deep soulful understanding of the world with a risk-taking flamboyance.

Mr. Kirk, who once had a ponytail and still wears Birkenstocks and collarless shirts even to some formal business meetings, composes electronic music. Every year at Christmastime he sends his executives and hundreds of other people copies of a book he deems interesting. Last year’s was “The Railway Journey: The Industrialization of Time and Space in the 19th Century,” by the German cultural historian Wolfgang Schivelbusch.

Married and divorced three times, Mr. Kirk has four children ranging in age from 6 to the early 40s. The oldest, Julian, works for his father’s investment firm, Third Security.

While Oxitec is nominally headquartered in Germantown, Md., Mr. Kirk spends most of his time in West Palm Beach. His home, on a narrow stretch of land, has property extending from the Atlantic Ocean to the Intracoastal Waterway. He also keeps a residence in the Four Seasons Hotel in San Francisco and owns a 7,200-acre cattle farm near Radford, Va., where he used to raise falcons, hawks, owls and eagles, tramping through the woods to roust squirrels and rabbits that the birds would eat.

“You are mutual predators, you are partners in the hunt,” said Mr. Kirk. “The thrilling part, really, is the opportunity to enter into a relationship on the animal’s terms, on terms the bird understands.”

Now he’s too busy, he says, running Intrexon, which has grown to about 750 employees and has acquired a lot of basic technology beyond UltraVector.







The company lost $84.5 million on revenue of $173.6 million for last year. Half the revenues came from an established business that Intrexon acquired — Trans Ova Genetics, which sells embryos and other products for cattle breeding.

Much of the remaining revenue comes from its partnerships with companies who pay to use its technology. For instance, Fibrocell is developing a gene therapy for a rare genetic skin disease and OvaScience is researching a way for women to undergo in vitro fertilization without needing hormone shots.

Most of these ventures involve smaller companies in which Mr. Kirk or Intrexon now owns stakes.

Its most important collaboration is probably with Ziopharm Oncology, a cancer drug company.

One project involves gene therapy to treat cancer. It uses a “gene switch” from Intrexon that acts like a light dimmer, allowing production of an immune-boosting protein inside the body to be decreased if needed to avoid side effects.

An Intrexon competitor with similar broad scope is Synthetic Genomics, which is also controlled by a wealthy, visionary entrepreneur, the genome scientist J. Craig Venter.

Perhaps tougher competition will come from more focused companies.

For example, Intrexon and Ziopharm are behind more specialized companies in engineering cancer patients’ immune system cells so they can better attack tumors. One of those specialized companies, Juno Therapeutics, has a market value almost as high as Intrexon’s.

“We have multiple projects right now, any of which should be worth more than our total market cap,” said Mr. Kirk, somewhat in frustration.


If anything in Intrexon’s pipeline works, say perhaps the mosquitoes, the company’s value could climb sharply. Mr. Kirk vowed to make that happen.

“This is my last company,” he said. “I can’t imagine anything else that I will ever see that will be as compelling as Intrexon.”
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

Copyright © 1995-2017 Knight Sac Media. All rights reserved.Stock quotes are delayed at least 15 minutes - See Terms of Use.