MaRS client, Kalgene, sees some cash

Kalgene Diagnostics (a division of Kalgene Pharmaceuticals – a MaRS client company and incubator tenant) has just raised $500,ooo from the PARTEQ Venture Fund to develop novel diagnostic tests for cancer.  PARTEQ Venture Fund is a provincially sponsored investment fund set up by PARTEQ Innovations.  See the news release, “Four Kingston startup companies receive $1.6 million vote of confidence”.

According to Dr. Nathan Yoganathan (Kalgene CEO) the company raised a total of $1.5 million in 2009 from private investors – no mean feat in these challenging times.

Kalgene is an oncology company which develops cancer therapeutics and companion diagnostics with the goal of providing personalized treatments for cancer patients.  Kalgene’s lead therapeutic program is for bladder cancer (Phase III in EU).

Celebrate good times, c'mon!

To shed further light on Kerri Golden’s excellent recent post, the stumbling block that has been removed in this case is the Section 116 – a series of tax requirements that imposed onerous restrictions on foreign investors in Canadian firms.

Faced with an undercapitalized Canadian VC sector and the Section 116 restrictions, our emerging companies were either forced into premature public listings (often via a CPC mechanism) or had to concede that it made no sense to develop a knowledge economy-oriented enterprise here.

Under Section 116, a US venture capital company that wished to exit from an investment in a Canadian firm had to gather as many as 900 signatures from its limited partners, have each of them file income tax returns in Canada (even though no tax was due in Canada) and undergo a holding period that could have greatly undercut returns from a successful IPO.  Little wonder that the best funded and best managed VC firms on Earth decided that Canada was a no-go zone.  Incidentally, there is no such red tape for Canadian investors regarding US companies.

In the March 4, 2010 budget the Harper government finally removed this steep barrier to major foreign capital and has provided our emerging companies with a much needed lifeline.  So now, at long last, the Canadian technology sector is finally open for business on the world stage!

FYI: Stephen Horwitz of Choate Hall and Stewart LLP eloquently summarized the vagaries of Section 116 in this article.

Nitric oxide, neurotransmission, MaRS!

Nitric oxide (NO), known commonly as a ozone-depleting pollutant, is produced naturally in the human body and fulfills a variety of physiologic functions including acting as a neurotransmitter, vasodilator and anti-infective.  NO has been implicated in a variety of diseases and conditions including pain, Parkinson’s disease, Alzheimer’s disease, traumatic brain injury, stroke and inflammatory disease.

MaRS and NeurAxon Inc. are presenting an international symposium on this exciting field with 20 world-leading researchers, including 1998 Nobel Laureate Dr. Ferid Murad of the University of Texas, at MaRS on May 27-28, 2010. Why is the next Future of Medicine™ conference, “International Symposium on Nitric Oxide and Other Gaseous Neurotransmitters” important?

In 1998, Robert Furchgott (SUNY), Louis Ignarro (UCLA) and Ferid Murad (UT Houston) shared the Nobel Prize for Medicine for their discoveries relating to the role of NO as a signaling molecule in the cardiovascular system. NO is able to regulate blood pressure and control blood flow to various organs.  Readers may be interested to know that the popular ED drug Viagra(r) works via an NO-related mechanism.

In the nervous system, NO is unlike typical neurotransmitters in that it is synthesized and released only when needed – it is not stored for future use.  Various tissue forms of the enzyme nitric oxide synthase (NOS) control the generation of NO and this is where the majority of the R&D activity is focused.

Being a small molecule, NO rapidly diffuses across cell membranes without active receptor uptake.  These properties combined with rapid decay help make NO one of the most fastest acting signaling molecules across cell boundaries.  Consequently, any imbalance in NO production can quickly affect cell and tissue behaviour.

Our conference will bring the leading pharmaceutical and academic experts in the NO field to Toronto.  Other emerging gaseous neurotransmitters such as CO and HS will also be discussed.

If you need to NO, MaRS is the place!

"Tennis for yes, drive down the DVP for no"

British and Belgian scientists have developed a fascinating way to communicate with patients with severe brain injury as reported in this week’s New England Journal of Medicine.

Martin Monti and colleagues used functional magnetic resonance imaging (fMRI) to visualize real-time brain activity in response to questions in a group of patients in either vegetative or minimally conscious states.

The ingenious feature in this work is that the patients were asked to respond to questions by thinking about either a motor activity (playing tennis) or a spatial activity (driving around a familiar location).  Since these mental activities “light up” different parts of the brain they can be used to signal a “yes” or “no” in response to questions.

The study involved 54 patients – 23 were in a vegetative state (unresponsive, eyes open) and 31 in a minimally conscious state (inconsistent, erratic responsiveness, eyes open).   The third category (not assessed in this study) is coma in which patients are non-responsive and have their eyes closed.

They found that five of the 54 patients could alter their brain activity by focussing on types of activities.  One of those patients was able to use this approach to communicate with physicians even though standard means of communication were impossible.

The authors concluded that some patients with severe brain injury can demonstrate brain activity consistent with awareness and cognition and that this approach can be used to communicate with these patients in a rudimentary way.

Quite amazing — with lots of potential applications in life sciences.

Are you watching TED?

Your inbox is about to become a lot fuller. The TED2010 conference just wrapped up in Long Beach, California, wowing audiences with a wide range of ideas. As always, the talks will be available online, in easy-to-forward bite-sized chunks.

The first video became available just last week (Feb. 15): an incredible tour of Microsoft’s new “augmented-reality” mapping software by programmer Blaise Aguera y Arcas.

The tour of the new features in Microsoft’s Bing Maps focused on the three dimensional street view, similar to GoogleMaps’ high-profile imagery. “We see this 3D environment as a canvas on which all sorts of applications can play out,” says Arcas. Like Google, Microsoft has been trolling the cities of the continent filming streets not only from the roof of a car, but also with a “back-pack camera”.

Microsoft’s big leap forward is their use of user-created content, such as geo-tagged photos from Flickr, to augment the map view from different angles and locations.  Arcas calls it “crowd-source mapping.” The digital content is sewn into the fabric of the 3D map environment using software from Sea Dragon.

Arcas presented a demonstration from Seattle’s Pike Place Market, where live film footage of the market was embedded into the map Arcas was looking at. His friends in Seattle could wave at him through the map.

Expect more videos on the TED site over the next few weeks. Current Tweets and blogs from TED2010 have people excited about entomologist Cheryl Hayashi’s talk on the uses for spider silk. Another highlight promises to be the performance by ukulele virtuoso Jake Shimabukuro.

The TEDTalks videos have evolved into memes that set the standard for the proliferation of new ideas. Check out the videos as they hit the web here.

Technology built with privacy in mind

Protecting civil liberties is not usually top-of-mind for high tech start-ups. In information and communication technology (ICT), success has come from solving business problems, satisfying consumer wants and globalizing commerce. Yet, in a post-9/11 world, ICT stands at the centre of controversy about the limits to personal privacy.

The information age has spawned a host of potentially intrusive applications – from web-based networking sites to biometric screening and video surveillance. The question is whether these technologies can do their jobs without compromising an individual’s right to determine how personal information is shared.

Today the debate about privacy is becoming highly polarized. For some, horrifying terrorist attacks and near-misses mean that a loss of privacy is inevitable. It’s a price that must be paid for public security.  For others, the digitized capture, storage and use of personal information poses a serious threat. In the wrong hands it can lead to institutional coercion and inappropriate disclosure of private conduct. The divide between the two opposing camps has meant that privacy versus security is seen as a zero-sum game. And advanced technology is the battleground.

Enter Ontario’s Information and Privacy Commissioner. In the 1990’s Commissioner Ann Cavoukian coined the term Privacy by Design. Since then, Dr. Cavoukian and her team have partnered with industry leaders to build the concept into a credible business practice. Privacy by Design rejects the zero-sum equation and argues that breakthrough technologies can embed privacy safeguards and meet security standards at the same time. Privacy-enhancing technologies have design principles that are privacy-protective while making it unnecessary to trade off security goals. This approach places the onus on technology firms to identify risks and build in responsible controls that reduce the need for individuals to protect themselves.

Seven foundational principles are at the heart of Privacy by Design:

1. Proactive and preventative, not reactive
2. Privacy as the default
3. Privacy is embedded into design
4. Fully functional – positive-sum, not zero-sum
5. End-to-end life cycle protection
6. Visibility and transparency
7. Respect for users’ privacy

For new tech ventures, embedding privacy in technology architecture is a strategic way to create smart products, address customer concerns and deal with important compliance issues up front. Companies that take this integrated approach gain competitive advantage by being able to offer customers secure  environments and sound risk management as well as product functionality. This is a big plus whether you are a technology supplier or retailer.

At Privacy by Design: The Gold Standard, a  recent conference convened by the Commission, companies advised by MaRS and TechAlliance showcased their privacy enhancing technologies:

• Bering Media’s privacy architecture enables location-based advertising across any website without disclosing the identity or location of the subscriber
• CognoVision helps companies measure the effectiveness of in-store marketing and understand shopper behaviour through anonymous face detection and people-tracking software
• ConnectedN offers a private and secure “members only” social media platform that allows employees or members of a group to share their views with peers without identifying the original contributor
• PrivIT Healthcare provides client control over personal information through encryption processes that embed the ownership and access rights into the information at the time the data is collected
• Skymeter provides an in-vehicle road-use meter that preserves driver anonymity and restricts access to personal data while calculating fees based on when, how far and where a vehicle travels and parks

These companies showed that embedding privacy in technology is a differentiating factor that has marketplace value. So, it’s no surprise to learn that in the MaRS ICT practice, Privacy by Design in integrated into the advisory process for start-ups, from early stage to more mature ventures.

As the Privacy by Design movement has evolved, the message to technology companies is clear. Protecting personal freedoms makes good business sense.

For more information, check out www.privacybydesign.ca

Watch Tom Rand on Samsung and the Economy

A lot of people don’t like the Samsung deal. There is apparently problem with the fact they are “subsidized” in bringing their $7 billion to the table and creating the first real, large-scale wind manufacturing facility in Ontario.

I love the deal. And cries of “foul” miss the point. Here’s why:

The tar sands are subsidized. First, there are big tax breaks for capital development. Then, of course, no-one cleans up the massive oily ponds nor accounts for the externalities of carbon emissions.

The nuclear industry is subsidized. First, the offloading of that massive $20 billion in debt. And no-one’s thought of paying for permanent disposal of fuel nor de-commissioning of the reactors.

But bring a big wind player to town and subsidize the creation of 16,000 next-generation clean, green jobs and suddenly there’s an uproar. Are they subsidized? Sure – to the tune of about $30,000 per job over and above the Feed-In Tariff (a total of around $400 million over 20 years). What did we pay for saving those GM jobs again …? Oh yes, somewhere north of $2-$4 million, according to the erudite J Simpson in the Globe.

But comparing subsidies misses the point. All nascent industries are subsidized – in some way – to get off the ground. The Samsung deal is just the first domino of many to fall as we de-carbon our economy. Samsung at the table means we’re finally talking about significant manufacturing being brought to bear. It means we may begin to generate the momentum required to really build a clean, green manufacturing base.

Samsung (and the Green Energy Act) is only the opening salvo in building the massive amount of infrastructure to replace our aging grid and to de-carbon our economy. Those countries that build capacity, attract capable manufacturing companies, generate innovation and work to attract and support the cleantech sector — those will be the economies that end up selling clean infrastructure. The rest will buy it. Samsung is an indication we’re moving in the right direction: to be sellers of cleantech.

Did they get a special deal? Of course they did, they came to the table with $7 billion in investment. That’s how the market works.

Here’s a video of TVO’s The Agenda with Steve Paiken in which I debate with a few others on this issue earlier this month.

Go Samsung, go. And may you attract many others.

Unlocking the natural history of DNA

As every biology major knows, “Phenotype = genotype plus environment.”  We can’t do much about our genotype (or at least until Craig Venter has his way), but what about modification of gene expression?

The addition of a methyl group to our genes (DNA methylation) is a potent way to silence expression.  Aberrations in gene expression due to methylation/demethylation have been well characterized in various cancers.  Also, as the stem cell field has shown, tight control of gene expression occurs in early development and clearly governs cell fate.

Christian Popp and colleagues at the Babraham Insitute and UCLA have shown (in their recent Nature paper) that the enzyme Activation-Induced cytidine Deaminase (AID) has a profound effect on DNA methylation.

In mice that lacked the AID gene (AID-/- ), day 13.5 mouse embryos had substantial DNA methylation across their genomes (i.e. gene expression OFF) in contrast to wild type (AID+/+) mice who showed a substantial lack of DNA methylation (i.e. gene expression ON).

The authors concluded that this mechanism is active across the entire genome and may be the critical method used to govern gene expression in early mammalian development.  AID essentially acts as a “hard drive defragmenter” for the genome and prevents epigenetic mutations from being passed on to future generations.

Now that we know the mechanism whereby gene expression is controlled in development (AID enzyme), we can combine that knowledge with insights from stem cell biology. This could serve as the foundation for changing cell behavior in a variety of tissues, especially if they need to be “reset” to remove a damaging trait.

Positron Emission Tomography (PET) brain scan

Advances in diagnostic imaging are helping doctors and radiologists identify malignant tumours, cardiac issues and neurological diseases earlier and more accurately than ever before.  In many cases, this can mean the difference between a close call and something much worse.

The most recent report from MaRS Market Insight examines the challenges and opportunities facing Ontario’s diagnostic imaging community.  The report also highlights some of the companies and technologies that are emerging as new leaders in this evolving market.  From regulatory hurdles, to reference installation, to relationship-building with the “big-four” medical imaging OEMs, this study takes a probing look at the market environment and strategies for commercializing innovations in diagnostic imaging in Ontario.
Some key findings include:

An MRI of a beating heart

1. Research excellence in the computer science departments of Ontario universities is creating a growing opportunity for fruitful collaboration with medical imaging researchers for the development of high-powered computer-assisted-detection, image analysis and segmentation software applications.
2. Ontario medical imaging researchers have a competitive advantage in collaboration.  Whether it be with industry, clinicians or cross-disciplinary consortia, Ontario’s medical imaging researchers lead the market in their ability to collaborate effectively for the development of new medical imaging technologies.
3. Greater procurement coordination among hospitals and clinics for medical imaging software and equipment is needed.  Enhanced coordination would lead to significant cost savings for both purchasers and suppliers and would possibly lead to an increase in demand for medical imaging technology in Ontario.
4. Though hurdles remain, Ontario’s diagnostic imaging community represents an untapped opportunity for a major medical imaging OEM to operate locally.

With an outstanding constellation of universities, hospitals and research institutes, the pace of innovation in diagnostic imaging in Ontario shows no signs of slowing.   Ontario researchers are advancing the frontiers of diagnostic medicine by bringing powerful new imaging modalities, software and network technologies to the world market.  Through fruitful partnerships with the world’s largest imaging equipment OEMs, Ontario is becoming a world-class centre for innovation in diagnostic imaging.

The Diagnostic Imaging report was written with contributions from senior executives at some of the world’s leading medical imaging equipment OEMs; leading biophysicists, researchers and clinicians at some of Canada’s most prominent hospitals and research institutes and an array of domain experts across Ontario.  Download the full PDF report.

Human embryo photo: Dr David Becker, Wellcome Images

Fate Therapeutics Inc. – a start-up biotech that develops pharmaceuticals to stimulate stem cells – has staged a major coup for iPS cells, the adult-derived stem cells that have the all characteristics of embryonic stem cells without the controversy (see “Major breakthrough in stem cell science”).

Fate Therapeutics holds an exclusive license from Rudi Jaenisch’s group at the Whitehead Institute to their patent application governing iPS cell technology (“Methods for Reprogramming Somatic Cells“) which has a priority date of November 26, 2003.  According to a February 4 press release from Fate Therapeutics, the US Patent and Trademark Office has now allowed the claims.

Rudolph Jaenisch MD

The intrigue here is that the Jaenisch application pre-dates the US patent application of Shinya Yamanaka (the “Godfather of iPS cells”) by about three months and effectively gives Fate Therapeutics a very strong legal position in the USA in the iPS cell space.

Shinya Yamanaka MD

According to our sources, the Whitehead/Fate application had a rather rocky ride at the US Patent and Trademark Office and there was some doubt that it would prevail. However, now that the patent has issued with broad claims the balance of power will likely tip towards the USA for commercial applications of this technology.

Never a dull day in Stemcellville!