Team:Lethbridge/Entrepreneurship
Entrepreneurship
Minimal Viable Product
Based on our preliminary interviews with diabetes researchers, patients, and clinicians (see our Integrated Human Practices page),we first outlined a value proposition canvas to determine our minimal viable product. We found that the bottom line is that “every single diabetic would use an oral insulin if it were available” (Dr. Steve Ferzacca). An oral insulin tablet would not only reduce the pain and anxiety associated with injections, but would also improve accessibility by increasing shelf life and enabling non-refrigerated storage in impoverished communities.
Novo Nordisk successfully developed an oral insulin in recombinant microbes but abandoned it during Phase II clinical trials because the dosage required to ensure efficacy after passing through the stomach was 58x that of injectable insulin (Halberg et al., 2019). Thus, our minimal viable product is an oral insulin that remains stable through the acidic stomach environment to both improve patient quality of life while also minimizing the required dosage (and thus manufacturing costs).
Rather than trying to reinvent insulin itself, we decided to refine the manufacturing process and delivery mechanism instead. Thus, we have created “Algulin”, an oral insulin produced and administered in microalgae.
SWOT Analysis
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Weaknesses
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Opportunities
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Threats
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Market Analysis
The global insulin market is currently valued at $22.1 billion USD and, between 2019 and 2024, it is forecasted to expand at a compound annual growth rate (CAGR) of 4.93% (Mordor Intelligence, 2019). However, the diabetes treatment market is predicted to be particularly boosted by emerging oral insulins. According to a recent market research report specifically addressing needle-free insulin technologies, which includes oral insulins, the needle-free insulin market is currently valued at approximately $10.95 billion USD and is anticipated to reach $21.8 billion USD by 2025, expanding at a CAGR of 10.3% (Infinium Global Research, 2019).
Globally, an estimated 422 million diabetics were receiving treatment in 2014 and that number has been increasing by ~0.4% each year (World Health Organization, 2016). Approximately 9% of these patients have Type I diabetes, a condition in which the pancreas produces little or no insulin, and thus all Type I diabetics rely on daily insulin injections. The remaining majority (91%) have Type II diabetes, an adult-onset condition where cells gradually become insulin-resistant and the pancreas eventually becomes unable to produce sufficient insulin. Often, Type II diabetes can be effectively managed with a combination of diet, exercise, and medication, with an average of ~15% of Type II diabetics requiring insulin. Together, it is estimated that approximately 26% of all diabetics rely on insulin resulting in an addressable global market of over 110 million diabetic patients (Centers for Disease Control and Prevention, 2011).
However, it is important to note that there are two categories of insulin: fast-acting or “bolus” (to prevent rises in blood glucose levels resulting from meals) and long-acting or “basal” (used to stabilize blood glucose levels during periods of fasting). Whereas Type II diabetics generally take daily basal doses of insulin, Type I diabetics use both, typically at a target basal to bolus ratio of approximately 1:1. Considering that Algulin was designed to bypass the stomach, a process that takes several hours, Algulin will directly compete with other long-acting insulins on the market.
Finally, the market can also be subdivided into geographical segments. While Algulin is undoubtedly relevant to the global diabetic market, we are primarily focusing on the North American market for early commercialization efforts. With increasingly sedentary lifestyles and a consequential rise in obesity rates, North America has a dramatically growing prevalence of Type II diabetes and thus also a rapidly expanding market for diabetes treatments. Furthermore, in the absence of universal healthcare, novel products, or generic competitors, the market price of insulin in the USA has become so outrageously inflated that is inaccessible for many patients. As an example, a 10mL vial of HUMALOG® (with 35mg of insulin lispro) is approximately $300 in the United States but only $35 in Canada. Thus, a company offering a cost-effective insulin alternative is desperately needed in the USA. Finally, our envisioned company would be incorporated and physically located in Canada, and patentability will be limited to North America after disclosure on our Wiki and at the Giant Jamboree in October of 2019.
Competitive Analysis
The global human insulin market is dominated by three companies: Novo Nordisk A/S, Eli Lilly and Company, and Sanofi. Together, these three companies control 96% of the market with Novo Nordisk alone accounting for almost half of all insulin products on the market (Gotham et al., 2018; Mordor Intelligence, 2019).
In the basal insulin market segment, Novo Nordisk currently has a once-weekly long-acting insulin in its pipeline (LAI287; ClinicalTrials.gov Identifier: NCT03751657) and Eli Lilly is also developing “Basal insulin-Fc” (LY3209590; ClinicalTrials.gov Identifier: NCT03736785). Both are injectable insulins that have reached Phase II clinical trials.
However, there are currently no oral insulins on the market. As previously described, Novo Nordisk successfully developed a long-acting oral insulin (I338) but recently withdrew it from Phase II clinical trials because the required dosage was not cost-effective to manufacture (Halberg et al., 2019). Biocon Ltd. is developing Insulin Tregopil (ClinicalTrials.gov Identifier: NCT03430856), which is a fast-acting oral prandial insulin and thus not a direct competitor in the long-acting insulin market segment. Oramed Pharmaceuticals Inc., however, has an oral insulin (ORMD-0801) for treatment of Type II diabetes in Phase II clinical trials (ClinicalTrials.gov Identifier: NCT03467932), which is currently the most promising long-acting oral insulin candidate and may reach the market in the next few years. The clinical results and market price of ORMD-0801 remain to be determined.
Cost Analysis
Depending on the scale and complexity of the closed photobioreactor used, algal biomass can be produced at a cost of anywhere from $3-20/kg at a commercial scale (Chisti, 2007; Kothari et al., 2017). Approximately 25% of that biomass is soluble protein and insulin produced within chloroplasts is estimated to make up 2% of total soluble protein (Rasala et al., 2010). Thus, even assuming a maximum production cost of $20 per kilogram of algal biomass, a modest cost estimate of Algulin manufacturing is $4 per gram of active pharmaceutical ingredient, and the insulin itself would not require extraction, modification, or purification. Even compared to projected production costs and retail prices for generic (and much more affordable) biosimilar insulins, Algulin still proves to be a more cost-effective alternative (Table 1).
Table 1: Estimated costs for long-acting injectable biosimilar insulins compared to predicted costs for Algulin. Algulin estimates are based on the same cost and production assumptions used by Gotham et al., 2018 to generate these manufacturing estimates for biosimilar insulins.
| Long acting insulin type | ||||
|---|---|---|---|---|
| Price of active pharmaceutical ingredient per gram (USD) | ||||
| Typical dose per day assuming 40 units per patient per day (mg) | ||||
| Cost of active pharmaceutical ingredient per patient per day (USD) | ||||
| Cost of active pharmaceutical ingredient in 1000 units (USD) | ||||
| Estimated production costs for 1000 units* (USD) | ||||
| Retail price for 1000 units of commercial equivalent (USD) |
* Assumes $1 per vial for materials, an operating margin of 20%, a 20% transportation cost, and $1.37 per vial to cover the costs of bringing the product to market.
With a total estimated overhead cost of approximately $3 per 1000 units of Algulin, or $43.80 per patient per year, Algulin is extremely affordable to manufacture. Thus, even if the retail price is set at four times the cost of production, Algulin would still only cost patients $175 per year compared to the $4,450-5,300 per year they currently pay for injectable insulins in the USA. Furthermore, assuming Algulin is adopted by only 5% of the 30 million diabetics in America at a retail price of $175 per patient per year, the annual profit margin is estimated to be $197 million.
Intellectual Property Protection
Inspired by Banting & Best, who discovered insulin in 1921 and sold their patent to the University of Toronto for only $1, we are dedicated to making insulin more affordable and accessible for diabetics. Ultimately, we want to prevent further insulin exploitation by current industry giants and set a market price that ensures a reasonable profit but also access for all patients. However, we also recognize that entry into clinical trials is an enormous financial barrier to continued commercialization that may not be feasible without patent protection and an industry partnership. As such, we explored intellectual property protection for this technology to facilitate further development in collaboration with academic or industry partners.
Together with a Technology Management Officer from TEC Edmonton, a health technology incubator, we conducted a patentability assessment for Algulin as an oral insulin. This assessment concluded that the patentability of our Algulin design is complicated by the multitude of insulin patents that have been submitted by industry giants to monopolize the market, as well as prior art surrounding the component domains. Thus, any resulting patent would require very narrow claims to maintain novelty and our future freedom to operate would likely be impeded.
However, while the engineering of plant chloroplasts and the production and bioencapsulation of proteins in plant cells has been patented (United States Patent and Trademark Office publication numbers 20180371485 and 20180327768), the production and bioencapsulation of pharmaceuticals in engineered C. merolae chloroplasts has not. Thus, there is an opportunity to patent the methods for engineering acidophilic C. merolae chloroplasts as a generic oral protein production and delivery vehicle, which could protect both the manufacturing of insulin as well as many other protein-based oral pharmaceuticals in microalgae.
Altogether, if additional funding is acquired, we will pursue intellectual property protection for the production of protein pharmaceuticals in microalgae in North America.
Funding Opportunities
Early this iGEM season, we were successful in both local and provincial entrepreneurial competitions, receiving seed capital for product development from MindFuel’s geekStarter program and the University of Lethbridge University-Industry Liaison Office SPRINT! Ventures competition. More recently, we won a Project Award and the “Most Entrepreneurial” Special Award at the provincial geekStarter aGEM workshop in September. In addition, we were also one of the successful top ten applicants for an Opentrons OT-2 robot (named HAL), which has helped us standardize many of our measurement practices to ensure quality control in manufacturing.
For continued product development and intellectual property protection, we have identified a number of possible funding avenues:
- Business plan competitions such as the local Chinook Entrepreneur Challenge
- Pitch competitions such as the University of Lethbridge Agility Pitch Competition or the INVENTURE$ Pitch Competition
- Crowdfunding through Kickstarter, Experiment, or the ATB BoostR campaign
- Angel investment or an early innovation partnership
References
Centers for Disease Control and Prevention. (2011). National Diabetes Fact Sheet: national estimates and general information on diabetes and prediabetes in the United States, 2011. Atlanta, GA: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention.
Chisti, Y. (2007). Biodiesel from microalgae. Biotechnol Adv, 25, 294–306.
Gotham, D., Barber, M. J., & Hill, A. (2018). Production costs and potential prices for biosimilars of human insulin and insulin analogues. BMJ Global Health, 3, e000850.
Halberg I. B., Lyby K., Wassermann K., Heise T., Zijlstra E., & Plum-Mörschel L. (2019). Efficacy and safety of oral basal insulin versus subcutaneous insulin glargine in type 2 diabetes: a randomised, double-blind, phase 2 trial. Diabetes and Endrocrinology, 7, 179-188.
Infinium Global Research. (2019). Needle Free Drug Delivery Devices Market (Technology - Jet Injectors, Inhaler Technology, Transdermal Patch Technology, Novel Needle-free Technologies, and Oral Drug Delivery System; Application - Vaccine Delivery, Pain Management, Insulin Delivery for Diabetes, Pediatric Injections, and Other Applications): Global Industry Analysis, Trends, Size, Share and Forecasts to 2025. Accessed on September 30, 2019 at: https://www.medgadget.com/2019/08/needle-free-drug-delivery-devices-market-growing-at-a-cagr-of-10-3-and-expected-to-reach-21-8-billion-by-2025-exclusive-report-by-infinium-global-research.html
Kothari, R., Pandey, A., Ahmad, S., Kumar, A., Pathak, V. V., & Tyagi, V. V. (2017). Microalgal cultivation for value-added products: a critical enviro-economical assessment. 3 Biotech, 7(4), 243.
Mordor Intelligence. (2019). Global Human Insulin Drugs Market - Growth, Trends and Forecast (2019-2024). Accessed on September 30, 2019 at: https://www.mordorintelligence.com/industry-reports/insulin-market
Rasala B.A., Muto M., Lee P.A., Jager M., Cardoso R.M.F., Behnke C.A., Kirk P., Hokanson C.A., Crea R., Mendez M., Mayfield S.P. (2010). Production of therapeutic proteins in algae, analysis of expression of seven human proteins in the chloroplast of Chlamydomonas reinhardtii. Plant Biotechnol J, 8(6), 719-733.
World Health Organization. (2016). Global Report on Diabetes. Geneva, Switzerland: WHO Press. Accessed on September 30, 2019 at: https://www.who.int/diabetes/global-report/en/