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SNBL’s “Nose-to-Brain” technology for fast drug absorption

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Interview - December 24, 2020

SNBL is committed to freeing patients from suffering, by supporting drug development and improving medical technology. We act as exemplary moral members of our society: upholding the spirit of the constitution, observing the law, respecting social standards, and acting as intelligent individuals. As a pioneer in contract research organizations, performing safety studies in Japan, we have accumulated decades’ worth of experience and know-how, and we have grown to be the largest pre-clinical laboratory in Japan (Teikoku Databank survey). With branches in the USA, Europe, and other parts of Asia, SNBL’s strength lies in its international cooperation in the drug development process – ensuring that we can meet the expectations of regulatory authorities all over the world. 

DR. RYOICHI NAGATA REPRESENTATIVE CHAIRMAN, PRESIDENT & CEO SHIN NIPPON BIOMEDICAL LABORATORIES, LDT.
DR. RYOICHI NAGATA REPRESENTATIVE CHAIRMAN | PRESIDENT & CEO SHIN NIPPON BIOMEDICAL LABORATORIES, LDT.

What can Japan teach to the world when it comes to Society 5.0?

Japan is suffering from a gradual aging of the population (7% of the population is over 65 years old), while the birth rate is at a minimum, making the balance between generations uneven. By 2040, Japanese experts predict that the population will be around 110 million and by 2080 it will have fallen to almost 60 million.

Over time, this will mean a decrease of 17.5 million working citizens, which is a completely disturbing figure. Each working citizen will have to support 1.5 senior citizens, something which is not sustainable in the long run. The primary reason underlying this is that 30% of the population will be 65 years old and above by 2040, and seniors who are incapable of finding a stable job will live in extreme poverty.

The Japanese Prime Minister has introduced several measures to alleviate these trends; most notably, action to support newlyweds to raise children by providing financial assistance ($6,000 pp.). Birth rates in the coming year will be even lower than average due to COVID, so this aid will be crucial.

On the positive side, there are numerous ways to diminish the negative effects of these trends, among which we find especially AI and IoT. To be even more effective, the former Prime Minister encouraged the influx of foreign workers into the country. A further solution was the inclusion of women in the manufacturing process. In 2016, we proudly received the highest of the three levels of the L-Boshi Award and certification from the Japanese Ministry of Health, Labour, and Welfare for being a woman-friendly workplace. SNBL is the first Kagoshima-based company to receive this award.

 

How are you contributing to Society 5.0?

Converting Society 5.0 into reality is a crucial step nowadays. Japan has the longest life expectancy, but the average lifespan and the health life year has a ±10 year difference. At SNBL, we want to bring up the health lifespan closer to the average lifespan and move on from absenteeism to presenteeism. We support this society by developing new medicine and collecting and analyzing individual data.

We think that since Japan is facing an increasingly aging population, we can set an example with Society 5.0 and take leadership role in the world. To illustrate this point we can mention our Wave Life Sciences (a merger of ONTARII and Chiralgen), which went public on NASDAQ. This company began in 2015 with a conversation between my great friend and former Harvard professor Dr. Gregory Verdine, who came to me with the idea of developing nucleic acid medicine drugs. Small molecule drugs and antibody drugs only cover 20% of all diseases, whereas nucleotide therapeutics can target the rest, which is 80% of the “undruggable” diseases. At the moment, we are focused on nucleotide therapeutics of genetic diseases such as Huntington disease and muscular dystrophy.

These diseases are those that do not have solid therapy or effective drugs that exist only for specific patients. However, we know the target genes from previous researches, thus by using our stereo-control technology, we can accelerate drug development to reach the clinical stage faster. Our prodigious experience in developing nucleotides therapeutics as a contract research facility makes us the best and ideal collaborative partnership with Wave.

Our business model works perfectly. We have even got to the point of making one-billion-dollar agreements with Pfizer and Takeda Pharmaceutical Company.

 

Could you give us an overview of your business segment and the services that you provide?

We have 3 major segments in our business. Firstly, the Clinical Research Organization (CRO) – We do safety assessment, pharmacology, sample analysis, pharmacokinetics, and preclinical studies. We made a joint venture company with Pharmaceutical Product Development (PPD) five years ago to support clinical trials. As a result, not only was PPD-SNBL able to grow its business close to three-fold, but it was also selected as a "Top-Five Growth Business and Desirable Employer" by Randstad Japan.

Secondly, with Translational Research (TR), there are two main businesses. One business is developing a nasal administration device and the other one is taking basic findings and technology that academia and bio-venture are holding and turning them into business. Lastly, with Medipolis Ibusuki, we have three businesses. One acts as support for the business of Medipolis’ proton therapy and research center, the second is geothermal energy. And finally, we have the hotel operation. We call all these Medipolis businesses as a whole.

For the geothermal plant, we are running a closed circulatory, binary geothermal power plant with a 1.5MW scale, which is environmentally friendly. Regarding the Proton Center, we launched a proton beam cancer treatment center in January 2011. We aim to contribute to improving the quality of life of cancer patients all around the world as much as possible through practicing fundamental and low-impact cancer treatment using proton beam therapy. Up to this point, we have been able to treat around 4,000 cancer patients through this non-invasive technique, I cannot be prouder.

We have been leading the CRO business for more than 60 years, and now, we are transitioning our focus to the TR business, which we make a profit through by creating and providing intellectual properties. We will be shifting to a research-supporting-style company that supports creating new pharmaceutical drugs.

I also established Satsuma Pharmaceuticals, Inc. in San Francisco, CA which was also listed in NASDAQ. With this one, I have already succeeded in making an IPO with two companies in the US and now I have a third one to launch in Japan in the process.

 

Are you looking to expand in one particular sector in the future?

In recent years, we have built strong partnerships based on our corporate philosophy, and we look forward to expanding on the TR business. We have been making success through the establishment of a bio-venture business abroad.

With Satsuma Pharmaceuticals, we are focused on the development of a Nasal Drug Delivery System that mainly includes dihydroergotamine for the treatment of migraines (phase III).  We are also working on “Nose-to-Brain” technology, which is absorbed from the olfactory region in the nasal cavity, passing through Blood-Brain Barrier (BBB), and thereby allowing the drug to be easily delivered to the brain.

 

What are your competitive advantages? What makes you the go-to partner over your competitors?

SNBL as a group can support all phases of the drug development process. At SNBL Group, we are all committed to freeing patients from suffering, by supporting drug development and improving medical technology. Forty years ago, I started a business focused on human medicine. I want to test very safe and effective medicine. There is an important CRO business market in the US, Europe, and Japan, but at the moment Japan’s is shrinking, so the US presents better business opportunities for us.

 

What is the role of R&D within your company?

R&D is crucial in the TR business as its ideas, compounds, and technologies originate from basic research. Apart from the capital invested in drug development, we have other activities going on; for example, our fisheries business. We started a research department on eels in 2014, which is one of my contributions to Japanese culture as the eel is one of our traditional foods. We developed our closed circulation system, and we are working on increasing the success rate of fertilization, researching on the cultivation of Leptocephalus, and nurturing young eels.

Also, our geothermal binary plants started in February 2015. We have the support of the Japanese government in this project, in which I have invested in order to lower the CO2 levels in the environment and support sustainability. It is not a profitable business for us, rather a stable one of which I am extremely proud.

In addition to ESG (environmental, social, governance) and SDGs (sustainable development goals), we are the first, as a general electricity utility, to provide a megawatt-class geothermal plant in the electric power industry in Japan.

We utilize the geothermal energy for cultivation; we started mushroom production in 2019, which received the Japan Organic & Natural Food Association (JAS) certification in 2020.

Regarding our drug development modality, our CRO continues its business through collaborative research with academia to provide support for drug development that matches new trends worldwide. We do not only work on existing fields, we rather look for fulfilling new needs in the drug development process, such as the screening of candidates for new drugs.

We’ll continue to invest and develop this as one of our pillars. Examples of this are: the cooperative research team established with Kyusyu University in an advanced medical open innovation center to promote cancer immunology research; our partnership with Keio Global Research Institute; and our partnership with Juntendo University, among others.

 

What is the role of co-creation and collaboration within your company? Are you actively looking towards joint development?

There is always room for collaboration or opportunities to come in all possible forms. By building these win-win relationships, we strongly recognize the importance of co-creation, and we are always looking for partners so we can strengthen our strong points, as well as support each other’s weak points.

Our TR business includes collaboration with academia, bio-ventures, and pharmaceutical companies. There is also an academic collaboration in the digital health field and collaboration with IoT businesses.

 

How are you supporting society regarding the development of a vaccine for COVID 19?

The Japanese Government wanted us to complete the clinical trials in less than six months and thanks to the aid provided by Prof. Morishita and his laboratory we managed to establish a program and completed our pre-clinical studies (a part of the trials) in just two months. We also joined Kibi International University for cooperative research on Covid-19.

 

The CRO market size is expected to reach USD 7.8 billion by 2027, registering a CAGR of 8.3% over the forecast period. What is your international strategy in light of this trend?

The CRO market is undoubtedly growing each year. There is a step to develop new drugs and preclinical trials of new drug candidates. In the last 20 years, the outsourcing ratio of Japanese Pharmaceutical companies has increased, and 90% of it is outsourced to CRO, such as Charles River Labs and Covance. Due to this, a lot of medium-scale CRO has ceased to exist because the two previously mentioned big CROs are buying them out.

We at SNBL are known for high-quality data and we are able to provide fast, flexible communication with clients. Not only in Japan, as 15% of our sales come from foreign companies, mainly from Europe and the US, even though we only have operations in Japan after closing our US facility.

 

How do you plan to continue growing?

For me, overseas now means commercial activity in the US and China. My first visit to China was in 1989; it was not until 2003 that I built my first facility there and believe me when I say that I never expected the dramatic change that China has undergone in the last decade. Previously we were on pace in terms of development and now they are leading the race and we are watching from afar, Japan has a long way to go.

It is very difficult for a Japanese company to enter the Chinese market so at the moment I’m focused on the American market – not only the pre-clinical business but also the TR business. That is my way of doing global business.

 

Are you looking for more venture capital?

I do not believe that I will have an obstacle in that since just since I have managed to make two companies’ IPOs – that really says it all.

 

What is your midterm strategy for the following 5-10 years of corporate growth?

My mission is to succeed with our TR business by reaching $100 million profit with a stable company.

 

What legacy would you like to leave?

I hope to leave a significant legacy. I have always wanted to carry development forward with a focus on the welfare of humanity, and always keep a good heart. We continue keeping hospitals and kindergartens, I was declared as the Honorary Consul of Kingdom of Bhutan 10 years ago, and that was my country's recognition of the long years of dedicated support.

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