Business Of Biotech
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Business Of Biotech
BoB@JPM: Rick Modi, Affinia Therapeutics
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The latest in our series of Business of Biotech podcasts recorded in-person at JPM in San Francisco features an inspiring conversation with Affinia Therapeutics CEO Rick Modi. Modi shares on how his upbringing in Kenya shaped his adversity-embracing worldview, and how that worldview contributes to his biotech leadership. We cover his transition from pharmaceutical work in Iowa to a career in biotech, the gene therapy advances Affinia is building on, the company's investment approach, its upcoming clinical trials, and much more.
The 2025 BoB@JPM series is supported by Alston & Bird, whose national health care and life sciences practice has more than 100 attorneys actively involved and integrated across the full spectrum of legal disciplines including regulatory, compliance, public policy, transactional, corporate governance, securities, FDA, biotechnology, intellectual property, government investigations, and litigation practice areas. Learn more at www.alston.com.
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I'm Matt Pillar. This is the Business of Biotech JPMorgan 2025 edition, and I'm here with a man who knows adversity and challenge quite well Rick Modi. Born in Kenya, 17 years in Kenya. Then he decided to come to the United States of America. This is a story we're going to hear very shortly His decision to come to the US and earn his degree in pharmacy and then launch a career in life sciences, leading up to his leadership now at Affinia Therapeutics, where he serves as CEO at Affinia Therapeutics, where he serves as CEO, so we're going to get right into that story.
Matt Pillar:We're here, by the way, we're here at the offices of Alston and Bird, in partnership with Alston and Bird, and I'm very thankful to Alston and Bird, a very reputable law firm in the biotech space. If you have any needs for legal advice in biotech, alston and Byrd is the place to be, so check them out.
Rick Modi:But yeah, we're here and I want to start right there.
Matt Pillar:I want to hear the story about what led up to your decision to come to the US and earn a pharmacy degree in Iowa.
Rick Modi:Sure Matt. So first thank you for having me on here as a guest. Very humbled to be here. Pleasure to meet you. The story is very, very interesting. So I was born in Kenya. When people meet me, by the way, say you don't look Kenya.
Matt Pillar:What is?
Rick Modi:your heritage. I'm Asian Indian by heritage. Kenya is a British colony. In those days there were a lot of Indians that they brought to Kenya to do work and they stayed over and started shops and families and kids like me at the time.
Rick Modi:So I spent 17 years in Kenya Amazing journey living in a third world country. People talk about survival of the fittest. Physically, this is survival of the fittest because you end up getting malaria and you survive it. It's survival of the fittest because there's not enough room in the next classroom and if you are not, you know working hard enough you get cut out pretty quickly. But yeah, I always wanted to get into the medical field. I mean it was pharmacy, physician, those types of careers. And I looked up again. Many people in these third world countries look up to the US and say wow, great education, land of opportunity. So I always had this vision and want and desire to be in the US. The pharmacy school in.
Rick Modi:Iowa was one of the top five, so that's how I ended up choosing.
Matt Pillar:Iowa.
Rick Modi:It was also one of the cheaper cost of living and for somebody coming from a third world country to a very well-developed first world country, cost of living is a major factor.
Matt Pillar:Yeah.
Rick Modi:So I got admitted in January in Iowa. So Kenya is on the equator, beautiful weather, and they use centigrade, not parametrized. But we'll come back to that at some other point Going from beautiful tropical weather to in the dead of winter. Iowa was one story, but I also grew up vegetarian and I only had two food choices in Kenya it was either corn or beef. You can imagine how long, much longer, I was vegetarian after moving to Kenya actually.
Matt Pillar:Yeah, that's wild. So you talk about growing up in a third world country and then making that transition. Aside from the climate and your culinary options? Were you prepared, coming out of an education in Kenya, to come over here and I mean, were you educationally equipped to? I mean, obviously you got in, but I'm just curious about that.
Rick Modi:Sure. So the education in third world countries is actually very buttoned up in the case of Kenya because it was a British colony way back when they followed the British system. So the British system has ordinary levels, advanced levels. They follow the general certificate of education, which many people in the US would not know what it is, but they are essentially examinations that place people.
Matt Pillar:And to give you an idea.
Rick Modi:My high school education in Kenya gave me 32 credit units for the university level in the US, so I got a head start on that and also gives you an idea of what the standard of education in Kenya was. You have to watch your tail off, to be honest, in a third world country, and the standards are really, really good. I was fortunate enough to also go into an English speaking school, which also helped me get past TOEFL and all these other tests that you have to go through to come to the US.
Matt Pillar:Yeah, what did your parents do in Kenya?
Rick Modi:No, I was a stay-at-home parent. My dad was in the banking sector and when I tell people in the US who was in the banking sector, they think oh, it must not be banking.
Rick Modi:No, he was a banking teller and a cashier initially and then worked his way up into the loan department and such, but they were hardworking people made ends meet, just like hardworking people do Instilled in me work ethics, integrity all the values that even to this day I look back and I'm so thankful to my parents for imparting on me. They did fund part of my education but the rest was classically.
Rick Modi:you know people that come to the US. They get a job in a lab working in the pharmacy school, which is what I did. And then also, you know, in addition to doing the pretty deep and extensive curriculum that pharmacy actually requires as well, it was a hard work, it was fun Many people, by the way, that come from other countries too. One of the great things about America is also it's a fun, loving place as well. So, like every other college kid, I also had my part of fun. You know going out to South Patrick for like spring break and you know doing all the things that college kids do and are probably not supposed to be doing.
Matt Pillar:But that was part of the experience. Yeah, where did the interest in life sciences come from? I mean, your mom's a stay-at-home mom. Your dad was a bank teller in Kenya. You know, was it your experiences in Kenya, with some of the health problems over there and diseases that Kenyans face, what was sort of the nucleus of your desire to put the work in to become a pharmacist?
Rick Modi:Yeah, that's a good question. In some countries, such as Kenya, for example, there are some fields that are looked upon with very deep respect.
Rick Modi:The health sciences is certainly one of them. So my initial career choice was actually becoming a physician. Yeah, Help patients do right by society, all those things. Pharmacy was my stepping stone to become a physician and just to be very good in pharmacy and ended up having a career in pharmacy. I decided to stay put in that and I'm very happy that I did. Eventually went back to business school actually for my graduate studies, but plan A was becoming a doctor, to be honest, and it was looked in with high regard.
Rick Modi:Um, my kids, by the way, are in their 20s right now. I have twins, twin boys, and they, like many kids on that age, they're, they're working right now. But also wondering is this their end stage career? Will they switch careers? And I tell them, go and have like, do things that you enjoy doing and and it will take care of itself. It's easier said than done, right, it's easier at this point to look back and say, yeah, I should just follow my heart and do the things that I enjoy doing. Of course, in the moment when you're debating debating between a first career or a pharmacist or a physician, or going back to grad school for business uh, in the moment those are really difficult decisions. But I look back and I say, if you work hard and go with the things that your natural strengths are, you should be okay.
Matt Pillar:Yeah, yeah. No, I can appreciate that. I have a 20-year-old and an 18-year-old, you know, and the pressures that they receive from every influence beyond their family, you know, to make choices and choose tracks. It can be overwhelming for those kids sometimes and you know, as dads we sort of have to give them that safe space to say, look, you know, we've been around and it's not all riding on the decision you make today. Right yeah, so yeah, getting back to your career trajectory the pharmacy to pharma transition the, the pharmacy to pharma transition.
Rick Modi:Tell me, tell me how that came to, came to pass. Yeah, so after graduating from iowa, I, I went to, I came to california. We're in california right now. So I came to california and did 10 years in a hospital pharmacy. Uh line of work um, it was great because it anchored me. Uh, these were patients in the, the ICU, where pharmacists are called upon to dose antibiotics. These were babies born prematurely. The pharmacists were called in to start IV nutrition. As an example, you were on the floor side by side with physicians and nurses and sometimes patients and parents to lend your expertise as a hospital pharmacist.
Rick Modi:It was great up to a certain point I started getting into administration within that healthcare system and then I began liking the business aspect of things as well, the administrative part and some of the entrepreneurial things that also come from becoming a pharmacist as well.
Matt Pillar:Was that part of your pharmacy training, Like when you were in pharmacy school? Is there a fair degree of like? You know, we're going to equip Dr Modi to become potentially an independent pharmacist, or we're going to equip Dr Modi to become potentially an independent pharmacist we're going to teach some business.
Rick Modi:A little bit, I would say, but not that much. Most of the curriculum is geared towards science. Yeah, I'll say the thing that I learned the most, both from pharmacy school as well as the decade as a working hospital pharmacist. They call it SOAP, S-O-A-P. It's an acronym that physicians use quite a bit when they evaluate patients. So the S is for subjective assessment, the O is for objective assessment, the A is for assessment itself, and then you apply them. Many people in the business world sometimes draw an analogy between the business situation and a patient. The treatment is worse as an example right, it's a benefit. Risk is an example for a decision you're making. Those are the skills that I would say that I learned a lot more, that were more applicable to the business world.
Rick Modi:But it was very similar in that sense, you take metrics that are non very subjective, you add metrics that are very objective, quantitative, and then you make an assessment and then find it's a very analytical field, the pharmacy field, and those are the skills that helped me, but more than anything I would say was more transitioning from many people with a technical expertise start growing up in the ranks and then end up being in a business type of a role.
Rick Modi:I began a second love in the second part of the business world Right, and that's where I compelled. I got compelled enough to say, well, wouldn't it be great to go back to business school and get a graduate degree and do all these things that I'm seeing with new drugs in the hospital, on the investigational Review Board, on the Pharmacy and Therapeutics Committee? Wouldn't be good to apply what I'm learning here into bringing these medicines from the other side right?
Matt Pillar:Yeah. So what did that movement tell? You went back to business school, right? Did you get your MBA? Is that what you did?
Rick Modi:I did. I went to Penn with two little, the twins that I referred to. Until at the time, they were barely not even two years old.
Matt Pillar:So Iowa to California, to Philly, to Philly yeah.
Rick Modi:And we, literally we, sold everything. The wife was, of course, you know not, not excited about it but came along for the ride as I would say yeah, and. And we put the strollers on the top of the van and moved cross country and the next two-ish years year and a half two years everything was at risk. To be honest, full-time, student, full-time yeah, I did it the hard way, it's probably a recurring thing in my life, whether it was planned or not. We can do it at some point, but I did it the hard way.
Rick Modi:I quit the job. My wife quit the job. She was a working nurse as well, and we were both essentially just living on loans and going full time. I was going to full time and she was taking care of the kids initially.
Matt Pillar:Yeah, wow, you have a great wife. I would agree.
Rick Modi:We're coming up on 30 years now. Congratulations.
Matt Pillar:Yeah.
Rick Modi:So you stick it out full-time at Penn, get your MBA and then what? Another interesting story and it always goes back to it's never planned, at least for me. I looked at banking coming out of business school. Really it seemed like banking would be a good career. Everybody was talking about banking as a place to be. I looked at consulting because, again, people with MBAs look at consulting as well. Interestingly, the opportunities that came to me were banking and consulting. Actually, in some cases they wanted to interview me.
Rick Modi:The ones that came to me were biotech and pharma. Yeah, and I ended up in a very small company called Centimore. This was still in Philadelphia. This was still in Philadelphia. This was still in the Philadelphia area, exactly yeah.
Rick Modi:So, thankfully we didn't have to move again my wife was happy with that part and Centmor had just been acquired by Johnson Johnson and they were launching a drug, a biologic that is quite well known now, of course, called Remicaine, but at the time it wasn't that well known and it was their first indication at the time of Crohn's and rheumatoid arthritis. And of course I had done my diligence in looking at the science. But my first week was the eye-opener for me, that sealed the deal and that I had made the right choice.
Matt Pillar:Actually, and what happened in that first week.
Rick Modi:So as happens in, many of these companies, when a drug is approved, it's a big celebration. Typically in biotech and pharma, the odds are against drugs getting approved. The science in the end are so many times it's just a very, very tough and challenging public science and business. Right With the approval of Remicade, they got the company together and did a company meeting and as part of that company meeting celebration which is my first week, by the way, so I'm climbing joining that company was just impeccable.
Rick Modi:Very fortunate, there was a woman on stage in her 50s and she was a mom with two kids and they wheeled her onto the stage, but she got out of the wheelchair and her message to the company was I was in your clinical trial as a patient who was involved.
Rick Modi:I've been taking Remicade, this infused biologic that you all have developed, and I can now get up and my walking ability is improving and I can now hold my kids. And our message to us was thank you. And as I was sitting on the stage, I had no part of this. I didn't develop the drug. This is my first week, but to be a part of that industry, a part of that company, a part of that journey and being able to say wow, I couldn't be a part of making such a big difference. That's what sealed the deal for me to say wow, if these medicines work, the effect size of somebody not being able to walk and then being able to get up and hug their children that's a private moment. So that was really like a baby, just to be already open.
Matt Pillar:Yeah, for sure. So how long did you stay with Senecor? I was at Senecor for seven years.
Rick Modi:What was your role there? I was on the marketing, commercial side. It was great because I could take everything I learned when I was in the hospital all the pharmacy science that I learned, all the conversations with physicians, with patients, and then the application of the business aspect of things and then be able to educate folks and be able to also place a therapy like Remicade in the proper place, like in the treatment paradigm. That's what I believe biotech and also commercialization is about the right patient choice, the right positioning and, for that matter, also the right education on the benefits and the risk of these products. In those seven years we launched Remicade in five different indications. It might have been six Rheumatoid arthritis is one. Crohn's disease, ulcerative colitis, psoriasis. Psoriatic arthritis it was drinking out of a virus. Literally. It was amazing learning. We made a huge difference and we continued doing lifecycle management obviously kind of got up as well.
Matt Pillar:Yeah. So at what point did you start to get the entrepreneurial itch, like you're? You know Senecor, johnson Johnson. You're in a pretty established role as an established company doing commercial work for an established product. You know where does this desire to move?
Rick Modi:way back to the other side of that continuum in biotech come from. Yes, sometimes I believe it's just a natural journey For me. Centercore led to MediMune, another biologics company.
Matt Pillar:Again, MediMune was already part of AstroSumicat.
Rick Modi:So we were a subsidiary in launching, building up the pipeline and launching additional drugs. But in MediMune I started doing more corporate strategic type of initiatives, including one on behalf of us or something like that as well. So that's where what I would say good judgment skills became important, and more at the higher level. These are decisions about franchises, about size, about indication selection, but it was still working through governance. It takes a long time to go through in big companies, various governance meetings.
Rick Modi:It takes a long time to go through, in big companies, various governance meetings and, as I developed, these skills more the ability and the courage to say I can do this in a smaller setting, became more germane and more attractive. So, guess what? I moved back to California for a smaller company called Intermune All the way back, yes, In the Bay Area and this was a company that was developing a therapy a small molecule this time called Aspirin in a disease called idiopathic pulmonary fibrosis, and we brought that to approval and launched that drug. And then eventually Roche acquired the company. But that company had been working on Esprit in the past.
Rick Modi:One phase three trial had been positive, another one had been negative and when I joined they were doing the third trial to prove or disprove whether the drug would really work in this population. So I was taking significant risk. Again I look back and I say, wow, isn't it great that we brought another therapy to patients and you know, ones that are in need with idiopathic pulmonary fibrosis. After that I haven't looked back at no big company since then. It's been all entrepreneurial, all small companies, including, obviously, you know since then Avaxis and then now Athenia.
Matt Pillar:Yeah, yeah. So tell me about that story. How did your, what was your exposure to it? Finneas that led you to CEO chair there?
Rick Modi:Yeah. So I think in some cases my journey is quite typical. In other cases it's atypical. What I mean by that is the proving grounds in big companies, where skill acquisition happens, is quite typical. And then the graduation from there might not seem like graduation at the time and then the graduation from there it does seem like graduation at the time. But the graduation from there to smaller companies, where then you start expanding your wings and get into higher roles and more, bigger responsibilities, is pretty typical and one that I have enjoyed because when I've gone into the smaller companies I now believe I'm anchored enough and I am courageous enough to make these decisions right.
Rick Modi:So when I was at Avexis we brought another gene therapy to patients called Sotresa. These are kids with spinal muscular atrophy. We give them this one-time therapy. It's infused as an IV infusion, we give it to them shortly after birth and the disease is called floppy baby syndrome. It's hard-running enough where many of these babies cannot really function. They never get the ability to start walking and such, and in many cases they can actually pass away before the age of two. So it's one protein that's missing, the SMN protein. So with the gene therapy we deliver, using a capsid, this missing gene and the gene goes to work and these babies are safe.
Rick Modi:So being a part of that team where we brought that therapy to that patient community and being able to help those parents and those kids they have their own careers now it was life-saving for them and life-changing just to be a part of that team.
Rick Modi:But that's also where I realized this particular technology can be useful in so many other diseases. The problem, however, is you cannot get all the different types of genes to make these types of curative benefits with the conventional capsules that are available out there. So when I left Avexis, that company was bought up by Novartis. After we got the approval, a very good colleague of mine, ed Mothers, who's a very well known investor with new enterprise associates, nea that I'd been working with at MetaMune actually way back when, had approached me to see what I was doing and I had considered multiple different CEO roles. But he said hey, I know a scientific leader who is in the gene therapy space and is trying to start a company. That gentleman's name is Luke Vandenberg and quite well known. He co-invented one of the initial capsules, c89. So he introduced the two of us. It was a phone call in a late evening.
Rick Modi:It was supposed to be 30 minutes and we just spent talking into the evening. We met in person later that week and he told me what he was trying to do and I had never started a small company before, forget like a startup. But I loved what he was trying to do. It was gene therapy coming off. Just seeing what gene therapy could do with the kids in spinal muscular atrophy, I was hooked and he was doing exactly what we believed, what I believed the limitations of interventional capsules were. So I took the risk and I said I'll partner with you. I haven't done a startup before, ever. There's no money around the table right now. I understand the science enough to realize. Of course it's going to be a slog, as I will call it, just like everything else in science, but sure, we we connected and we're now five years in.
Matt Pillar:Yeah, all right. Well, there's a lot of several directions we can take, all right. So you're sitting around the table and you decide that you're going to get in on this opportunity, this project, if you will. Right, what did you? You'd never done a startup before. So what was like? What was job number one for you personally to say, okay, like we're going to make a company out of this, I need to. X.
Rick Modi:Yeah, it's a good question. With any startup, the first thing is do you have the money? Can you get the money? So I to just do the initial work was six months of work just figuring out the strategy, figuring out the science, putting the pitches together. There's no pay in that.
Matt Pillar:You're on your own, yeah, but you and your wife have been there before. Was she as receptive to it this time around?
Rick Modi:By the way, I love my wife. She still works as a nurse, which she is receptive to at this time around. By the way, I love my wife.
Matt Pillar:She still works as a nurse.
Rick Modi:So she enjoys the same things that drove me all my life the patient interactions, knowing that we could be a part of this community, knowing that we could leave a legacy if it does work out right. So that was the again I'll say, the anchoring. That's the mission, that's the motivation, right? So, yes, there's no pay for a few months, but there's the hope, the conviction and the courage to say, well, we could do something here.
Rick Modi:So in those six months, you're writing personal checks to say I need a few more people to get some work done. I need a facility which you start with a shared space initially, but then you also need labs to start. So all that was initially a personal check, while we were trying to travel funding for what is called a seed financing, right, yeah, so we started calling on investors. I'm again very, I'll say, fortunate, lucky, blessed, but some is just being there at the right time at the right place sometimes, where the prior companies and the successes that we had in bringing therapists to patients also rewarded shareholders and investors. Right, so I had now a followership that I could call on and say look, this is what we're trying to do. Would you take the meeting? Let me walk you through why this particular company could be a good fit for you. Right?
Rick Modi:So we did that and did the seed financing initially, and then the series A, but those were our days. Sure, you said this was five years ago. This was 2019. And of course, you and I know also what happened in 2020, this was 2019. And of course you and I know also what happened in 2020, you know, called the pandemic, unfortunately, Our friends at Alston and Byrd set us up with some amazing space to record during JPM week.
Matt Pillar:The firm's national healthcare and life sciences practice has more than 100 attorneys actively involved in the healthcare industry across the full spectrum of legal disciplines in the healthcare industry, across the full spectrum of legal disciplines. The signature strength of this practice is its ability to master complex representations that draw on the coordinated expertise of its regulatory compliance, public policy, transactional, corporate governance, securities, fda, biotech, ip, government investigations and litigation practice areas. Alston Byrd represents life sciences companies and their partners in corporate stages ranging from private to newly public to well-established, and in a variety of stages of product development, from preclinical to post-approval commercial launch. Learn more at alstoncom and tell them you learned about them on the Business of Biotech, yeah.
Matt Pillar:I mean pandemic aside, I was gonna ask your perspective on where we were on this sort of delivery vehicle fervor in 2019. Like there's a lot of attention being paid to delivery mechanisms for gene therapies and you know how we're navigating them to the right tissues In 2019, what was it sort of you know early days for that, for exploration of that, or was it in full swing?
Rick Modi:It was a bit of both in the following ways in full swing it was a bit of both in the following ways. Conventional gene therapy was an uptick, so Avexodus was acquired by a big company. There were a few other dentists was acquired by a big company, right. So there was a belief that conventional capsules would be good enough and it would be copy and paste very, very easy Again. Biotech is never easy and paste very, very easy.
Rick Modi:Again, biotech is never easy. So there did be at the point it was good but it didn't last long where people realized conventional capsids will not cut it and that developing new capsids would be the solution to that. Again, as often happens including me I thought developing new capsids would be easy. It was a journey, so again it takes. You think it's going to be done in months. Sometimes it takes years. You think the first indication you select will be S-lambda. Sometimes it's not the first indication, it's the second or the third choice, right so to be able to persevere during the time. It happens in every biotech company, maybe not the first time, but maybe the third or the fourth time. But this is biotech. The odds, unfortunately, are against drugs getting developed and getting eventually to approval. So those early days was very interesting with the investor dialogues, because with some funds the time horizon just doesn't match with what the company is trying to do and how long the science is going to take to mature, especially when you're in licensing something from academia into industry.
Matt Pillar:You need to redo the experiments, you need to find the right indication and patient community to serve, and the translational aspect is very different than the research aspect of things yeah, so tell me a little bit about your, your approach to that, like what what's your um, what what's your risk aversion sort of strategy when you know you don't necessarily know what the market is going to, especially in the you know you mentioned the pandemic.
Matt Pillar:I mean you know, pandemic years were financially pretty good, at least early right, and then everything goes crazy. So what sort of management approach to that risk has allowed you to persevere to your point?
Rick Modi:Yeah, so I call it accumulation of experiences. As one goes through a career, or maybe life in general as well, one learns a few things about good judgment. I believe for a leader, and a leadership team in particular, that's one of the best skill sets to have. How do you render good judgment when data can be conflicting even with each other? Right, it can be scientific data, it can be business data, it can be market, economic, it can be the fundraising environment. So triangulating that back again to when I was in the hospital and using the SOAP the Subjective Objective Assessment Plan is what drives the perseverance and the good data.
Rick Modi:In biotech it's easier than, in my opinion at least, than in big pharma, where again, the governance bodies can be just more off our track. So we were able to make these calls as we recruited a great team of experts, coming in people from different companies. I could have brought again the same people that I'd worked with before, but I chose not to, and bringing that diversity in thinking and across functions allowed us to take in stride whatever circumstances that were there, and that included the pandemic. So, yes, from a financing perspective, there was more money flowing in the era, but from an operational perspective. That was really, really challenging for the people that were affected and also for the leadership that still had to deliver during that time. So those things just came with all the prior circumstances that we have been through, that I was wasn't through.
Rick Modi:You can then see pattern recognition. I've seen a movie like this before. Let me make some judgment calls today. Let's see how it unfolds and then let's course correct if we need to, like those were what saved the day many, many times over. Sometimes it was my experience, sometimes it was, you know, my colleagues experienced the chief scientific officer or the chief development officer, the chief business officer, the chief medical officer and the board. It was the collective that I always the chief development officer, the chief business officer, the chief medical officer and the board. It was the collective that I always say is always better than the individual.
Matt Pillar:Yeah, that's interesting. Have you always been really good at maintaining emotional control in the face of challenge and adversity In the older days. Yes, Less so in the younger days.
Rick Modi:Not to make it about demographic, but I think anchoring can come with just and steadiness is the other word I would use in what you're describing can just come from again when you've seen more movies, right type of thing, so you can take more things in stride. Sometimes it's not just professional experience, it can just be you had a child or somebody in your immediate family or passed away. These things also just put things into context and experiment that went bad or somebody left the company. You're just able to put things much more in context and say wait a minute, this is what I can control, this is what I can control and honestly, getting emotionally distraught about it is not even a consideration, right, but I wouldn't say in my younger days I was like that, Like with everybody, we do take things to heart.
Rick Modi:We are an organization, by the way, that is very open to feedback. That does take time to develop, meaning we give each other feedback. Nobody takes it personally, but I believe that actually is really important for developing an organization that continuously learns and the feedback also provides mutual steadiness too.
Rick Modi:So if I am facing a circumstance where perhaps I'm having more difficulty to take it in stride, I have a colleague next to me who knows how I react to that same circumstance and is going to help me have more of a steady hand in that situation. Right yeah, that same circumstance and is going to help me have more of a steady hand in that situation.
Rick Modi:We look after each other and, at the end of it all, I do believe people will remember those memories how we went through crisis and celebrations together and how we reacted in the moment. So I do believe that's super important.
Matt Pillar:Give me a sense of who the we is at this point. For Afinia, what does the company look like? Yeah, it's amazing.
Rick Modi:We're about 60 people overall 60 people. Each one is handpicked with just the skill set that they bring, the achievements that they've brought in the past, and then the cultural aspects of things as well. In the leadership team we have Charlie Albright as our chief scientific officer, very accomplished individual from BMS, editas, et cetera. Laura Richmond, our chief development officer she was at the University of Penn at the gene therapy program, the executive director there with me, and Manny Mew, our select in the middle there. Rami Daud, who, coincidentally, I went to school with at Morton and then we reunited after about 25 years, again very accomplished. Lilly, human Genome Sciences, auxilium, etc as well. And then, most recently I will not be able to disclose the name, but we have just hired a chief medical officer who will be joining in just about a couple of weeks actually from now. And then Rob May is the last person who gets over manufacturing with the Intervaxxers as well.
Matt Pillar:By the time this episode drops that chief medical officer will likely be known. Yeah, yeah, congratulations. Yeah, I mean you. You highlight the accomplishments of these folks that you put together on the team. What, what was the you know? Tell us about the challenge of putting together, scaling up that leadership team, you know, to align expertise with the mission of Affinia. Was it tough?
Rick Modi:It's always tough assembling the right team. I would say recruiting was good. I wouldn't call it tough, but perhaps because of the various companies that I've been at, it's the same diversity in companies that I was at that expanded my network. That also allowed me to approach investors but also build out the board as well. So between the leadership team and the board we've had exposure to I don't know what it is 20 or 30 companies.
Rick Modi:So you amplify that with the entire network of 20 or 30 companies, or 30 companies, so you amplify that with the entire network of 20 or 30 companies You're just able to speak with people, make a phone call and then get a really good, diverse set of individuals coming into the company, both at the board, the individual at the leadership and also the part of their organization as well. The track record, I would say, helps significantly. So when I can go in front of folks and say I've been at CenterCorp, metaimmune, interimmune, amexis, I'm starting to thin out. They know these companies are fairytale companies in biotech.
Rick Modi:And the number of medications and patient communities that got approved with these drugs is, again, I will just say, uncanny. You have that many.
Rick Modi:And it's the same thing for the other people that have the pleasure and the privilege of working with side-by-side in the management team. So it's been good to be able to recruit people from that perspective. But assembling the team still requires careful thought. And then the other thing that I would also say after you assemble, getting the right dynamic is also really, really important, Because the entire 60-ish people that are in the company are relying on the leadership team for making co-check decisions, being aligned, and we debate things really well, very candid dialogues, but when we have made the decision that we want flawless execution right. So putting a culture together that allows the candid dialogue but then the aligned decision and the execution is not easy work. I still look back through my journey in SIG. I also led a sales team as well, and being able to pour all the forces towards a common goal is an incredible skill set to have and one that does take time to develop as well.
Matt Pillar:I would say yeah, what were some of the key? I mean, it's an important point. I'm curious about some of the sort of key experiences that have contributed to that skill set.
Rick Modi:Yeah, and I use the word sales can be sometimes misinterpreted In biotech.
Rick Modi:You have to remember that you are still providing the opportunity for a patient or a family to make a medicine choice that will affect their health right, so I always call it education.
Rick Modi:Having gone through the sales experience, you set the right expectations of how you want an individual or an individual team to behave, the common goal that he or her or that team has, and then to be able to work side by side with that individual and make sure expectations are met and the common goal is achieved.
Rick Modi:That's the process and the what I would say the dynamic that set up in the world of commercial that is quite well trained and exhibited. So being able to bring that into the leadership team and beyond the leadership team, it's training, it's development, it's all those things and it's also I use the term followership in a manner in which you have to be able to craft a vision. You have to have people. It's a calling. You have to have them believe in that vision and then they're jazzed to go and see if it can make a difference in the world to these people that are counting on you that you have a technology or medicine that can make a difference in their life. So that I think is where magic happens in running a company or running a team or working with people.
Matt Pillar:So let's talk a little bit about the magic that Affinia is making happen. You've got the team, You've got the culture. You're all rowing in the same direction. Take us through some recent progress in terms of the technology and therapeutics that you're working on.
Rick Modi:Yeah, it's a momentous year, a very transformative year. So over the past many months developing capsids that get genetic cargo to the right destination, we focused on two tissues muscle and the central nervous system. In muscle, we focus on skeletal muscle and cardiac muscle. So we have capsids that get to skeletal muscle in all the diseases that are there for skeletal muscles, including douchan muscle dystrophy, myotonic dystrophy and others, and we have a set of capsids that do the same thing for cardiac muscle as well. In the cardiac muscle there's more and more genes that are being identified that explain why people have certain heart disease that can. This can be heart failure. This can be the heart getting larger, hypertrophic cardiomyopathy. This can be everything else.
Rick Modi:So we are focusing for our initial indication and program or lead program as we call it on a genetic disease of the heart. That gene that is affected is called BAG3. The resulting impact on the patient is they have heart failure. Now, many people have heart failure, but they shouldn't be getting the heart failure in their 20s and 30s. That's what happens to these individuals. The BAG3 gene produces this protein called BAG3, which is key to the heart cells beating.
Rick Modi:So imagine if the cell only has half the protein, of course the heart cell cannot beat and the individual ends up having heart failure. With the CAPSID and the delivery method that we have, we can easily package in this bag-free gene. It's full length, it's fully human one dose, simple IV infusion and we've shown in animals that the cardiac cell starts beating healthily again and the cardiac function is restored back to normal. We scaled up those studies to the higher species, the non-human primate studies, as we call it, and we've transferred that technology to our manufacturing partner, forge Biologics, and they'll scale it up to the desired scale they need. So this year we plan on filing an investigation on a new drug to the agency. We've met with the agency already. Initially that filing will happen in the fourth quarter of this year and this is a disease where our preclinical data shows us that we can actually get efficacy results very quickly.
Rick Modi:So we hope to come in the first half of next year and to show that what we've seen at the animal studies we can actually show in people.
Matt Pillar:Yeah, that's pretty wild. That's fantastic. I mean, you use the word easily. You know, we showed that we could do this easily. It seems like you know nothing. You even said like nothing comes easy. So how easy really was it.
Rick Modi:The jury will be in the clinical results for sure.
Matt Pillar:Yeah, we've selected this.
Rick Modi:I spoke about decision-making and diversity of opinion. I hope that reflects how much debate we put into selecting this indication. The biology of this disease is well blown out with human data. So in humans, people have shown that when bag three protein levels in the cells are lower, that cell doesn't beat fast enough hard enough. In humans, people have shown that when the MAG3 is not functioning properly, the people end up having heart failure and the difference is very pronounced and very quick.
Rick Modi:And the animal model that we are using almost identically mirrors the human disease, from the genetic defect to the molecular design behind it, to the exhibition of the loss of cardiac function and then, for that reason, the early death. A quarter of these patients have a heart transplant. Of course, in these animals they don't do a heart transplant, so that the animals end up, you know, unfortunately dying until we give them this gene therapy and then, as I mentioned, the cardiac function is lost. Will it be easy? No, have we done all the things we could to make sure that we have the risk? This program? Absolutely yes. So I'm super excited about pushing it forward into the clinical trials and showing that what we're seeing in animals will be seen in people as well.
Matt Pillar:With all the safety measures of depending to that account yeah, well, uh, what have you found in terms of the investment community's appetite for, for what, if any, is working on? You know, the gene, gene therapy space is one of those ones that's been subject to, you know, ebbs and flows, peaks and valleys in terms of invest investment, general investment appetite.
Rick Modi:Uh yeah, gene therapy is not regarded as in favor, as I will call it or invoke Again. There is eventual for investor sentiment on these things. I will say there is really good segregation between gene therapies that use conventional capsids and gene therapy companies that are developing new delivery methods, like us, that are capsids that actually solve the issues with conventional capsids. The last race that we did was in April 2021. So it's four years out since then, which is amazing. That was a series B.
Rick Modi:The reason we've been able to continue the company without doing another fundraising until we do one in the near future has been because we have delivered the capsids through a business development deal that we had with Vortex, and those have been earning the maximum financial milestones that we could have wonortex, and those have been earning the maximum financial milestones that we could have won. So that's been steadying the company financially. On those points, the receptivity is really good with this indication. There are tens of thousands of patients unfortunately affected in the US alone. It's a disease where there is no specific disease-modifying therapy. Even in our dialogues with the FDA, we believe that the data was received as being very compelling and our sentiment from the investors so far has been very encouraging that this is exactly the type of indication that they would like to see, where we've shown efficacy, safety.
Rick Modi:And also in head-to-head studies. Differentiation from others might be doing down the line in this disease. So we will do our best with that Fundraising. If any CEO tells you, by the way, it is a good market out there for fundraising right now, it is not, I can tell you right away, straight on that.
Matt Pillar:I mean, we're in a place right now where the message is mixed obviously right, like people are putting the shiny stuff out there, but it's not necessarily always really shiny yeah.
Rick Modi:Yeah, yeah. I would say that things that do help is the data speaks for itself, and our prior track record as a leadership team also speaks for itself. I think, where the dialogue does happen is in the three to four years timeframe ago. There was certainly, unfortunately, a lot of hype, so the valuations were more inflated than they likely should have been in retrospect at the time. Yeah, so of course there will be a reset in just the market as it has been going unfortunately for the past two or three years.
Matt Pillar:Yeah, you mentioned your partnership with Forge Biologics. I'm curious about what the plan might look like moving forward. I don't want you to make too strong forward-looking statement, but let's fast forward and say that those tens of thousands of patients who could benefit from this therapy have the opportunity to benefit from this therapy. Let's just use those words. This is a space where you know manufacturing and access and distribution have presented challenges historically. Access and distribution have presented challenges historically. How do you feel about that environment and its development between now and that point? Right Like, do you, do you have, do you have reason to believe that there's commercial, commercial manufacturing opportunity in a in a way that is going to create accessibility for patients for therapies like these?
Rick Modi:Yeah, really good question. So what I didn't mention earlier is one of the other areas that we spent significant investment in the technical side is also manufacturing Within our own company. On site we have a process science development lab that goes all the way up to 250 liters. I mentioned to you that one of the individuals we brought into our company, the head of manufacturing, came from AVEXIS, where he's done gene therapy manufacturing to a very good level of depth.
Rick Modi:So the new technology that we have developed, which is a proprietary plasmid design to get a little bit into the technical depth there, proprietary plasmid design, to get a little bit into the technical depth there allows us to improve our yields by 10 times and also improve the quality of the product. So we have tech transferred this to Forge Biologics. They have replicated the results. The results are good even in their hands, which is again really good science, and the amount of scale that we are using at Ford Biologics, similar to ours, is much smaller than what other companies might have to use if they did not have this proprietary plasmid design. So we are to give you a really good example even to go into our phase one, the first in human trial, we will use only a 50 liter scale.
Rick Modi:Many companies would use a 250 or a 500 liter scale. So that gives us really high confidence on both the ability to have the capacity to provide access to these patients but also to manage some of the cost of goods sold as well. When you take into account a disease such as backfeed I did a cardiomyopathy and you consider that about a quarter of them unfortunately require a heart transplant, the health economic argument for a disease like that and the cost on that individual, that family and overall society and the payer, the budget impact, as they call it is actually really really high. A heart transplant is millions of dollars, unfortunately, right, not to mention the subsequent cost that comes alongside a heart and immunosuppressant individual as well. So again, when we select these diseases, we're also very conscious of the societal benefit and ensuring that we have both the benefit risk of a gene therapy but also a strong health economic argument to support it as well.
Matt Pillar:Yeah, yeah, what would be an investor's trepidation around, like I mean, if you think about it, just you know, at a baseline level, simply fundamentally we're taking a technology that has shown its merit. It's demonstrated its merit. There's the potential to take it out of ultra rare indications, where you know, as an investor your benefit, your payback might be limited into more broad patient populations, broader indications, bigger patient populations, and you know, to your point there's a financial equation that's not going to make it.
Matt Pillar:Now we won't speculate on what the price tag might be, but certainly competitive to, or better than, a multimillion dollar heart transplant. So what's the concern? What would you say is the biggest concern right now?
Rick Modi:I would not say the investors have a concern. The Receptive is really good for the MAG3 dilated cardiomyopathy program as an exemplary instance of where gene therapy is a really good solution to it, with capsules such as ours, which gets to literally 100% of heart cells. Many investors, unfortunately from the I'm speaking secondhand from the dialogues with them- I'm not myself, of course, but for many investors.
Rick Modi:Unfortunately, the last few years have not been good, yeah, especially for the folks that are in the life science focused industry, because the generalists have benefited from higher interest rates and other areas beyond the lifetime sector. So for the ones that are focused on the life science area, they find more comfort with clinical programs, the programs that are already in the clinic and where the readout is in the next, say, six, months.
Matt Pillar:Right.
Rick Modi:In the case of Afinia, the IND is this year and the readout is in the early part of next year. So that is part of the exciting part is that by the time we do the subsequent financing, it is just around the corner. But they're being selective. Certainly for more clinical programs is the main thing.
Rick Modi:Sure, I do believe the way that gene therapy is evolving I think similar to what biologics went through when I was launching Remikade decades ago I believe the receptivity and the perception and the evaluation of a gene therapy will become modality agnostic. It's another potential medicine. It's another potential patient community. It's another potential for an investor. The return on investment right. The fact that it's a gene therapy is perhaps a secondary point, right. And so they will look at the science. They will look both in terms of the human biology for the disease and then the preclinical results that have been generated by the company for that particular disease, the dialogues with the agency, the FDA, and then make a decision on whether that is something that fits into their strategic fund that they are putting money, that they're deploying money for.
Matt Pillar:Yeah, interesting what's been on your agenda here this week.
Rick Modi:Interesting what's been on your agenda here this week. So I'd say about a good half meetings are business development meetings just big companies that like our technology, that also like our programs and pipeline as well and are curious about what we're willing to license to them. And then the other half are primarily investor meetings. Again, as I mentioned, it's been four years since we made the last round. We've been producing some great progress and we should press solutions for them, so there's some inbound interest in would like to hear more about you when I use your next fundraise, you know might make sense to speak now and then some are, I would hope such as yourself.
Rick Modi:So being able to speak to yourself and just spread the word out and also share the leadership journey has been also amazing as well.
Matt Pillar:Yeah, it certainly has. I mean, it's a great story. You've got a great story. The work you guys are doing is appreciated. We'll be paying close attention. So you've got some pretty big inflection points coming up here in the next year or so. So hopefully you'll be willing to come back on the show when there's some data to share and progress to share. Absolutely. But I've appreciated the time. I know it's a super busy week and I'm glad you made some time for the business, biotech Likewise.
Rick Modi:Thanks for having me over and wonderful.
Matt Pillar:Yeah, so that's Rick Modi, ceo at Affinia. I'm Matt Pillar. This is the Business of Biotech JP Morgan edition. We will drop again next Monday, I believe, with another JP Morgan edition, so subscribe. Wherever you listen to podcasts, make sure you watch the videocast at Bioprocess Online and Life Science Leader under the Listen and Watch tab, and we'll see you next week.
