Business Of Biotech

Building A Cancer Pipeline In A Molecule With Actuate Therapeutics' Dan Schmitt

• Ben Comer • Episode 282

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On this week's episode of the Business of Biotech, Dan Schmitt, President and CEO at Actuate Therapeutics, talks about building a company around elraglusib, a GSK-3β inhibitor for cancer. Dan describes his fast-fail approach to early product testing and development, using basket trials to evaluate chemotherapy combinations, and choosing pancreatic cancer as a lead program. He also talks about surviving an IPO during a brutal funding cycle for biotech, building lean teams and efficient operations, and potentially onshoring API in response to changing U.S. policy. 

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Ben Comer:

Welcome back to the Business of Biotech. I'm your host, Ben Comer, Chief Editor at Life Science Leader. And today I'm speaking with Dan Schmitt, president and CEO at Actuate Therapeutics, a clinical stage biotech focused on developing elraglusib, a GSK-3 inhibitor for cancer - that's glycogen synthase kinase, not GlaxoSmithKline. Dan joined Actuate in 2015 and has led the company since then through an IPO in 2024 and is now entering late-stage trials. I'm excited to hear from Dan about his leadership experiences with Actuate over the last 10 years, including being a first-time CEO and how he managed to continue elraglusib's various development programs and maintain a runway during a really difficult stretch for biotech. We'll also talk about efficient company operations and get some specific examples from Dan about ways to lower costs. We'll talk about working with API and CDMO partners and his key priorities for the future. Thanks so much for being here, Dan.

Dan Schmitt:

Oh Ben, thank you for your uh your attention and the time. And I appreciate the audience's attention as well. It's good to be here.

Ben Comer:

We're glad to have you. And as we do on the business of biotech, I want to start out with a little bit on your background. I wonder what you could tell us about your prior industry experiences before joining Actuate.

Dan Schmitt:

Yeah, so um uh, you know, starting very early on, I'm a I'm a scientist by training. Um yeah, actually going back further than that, my father was a veterinarian and I worked in his clinic starting at eight years old. He had a very large practice. And all the boys in my family worked the clinic. So we got steeped in sort of like all aspects of medicine, um, including, you know, pharmaceutical distribution, because veterinarians have their own um pharmacies. And at like 12 years old, I was running and stalking and filling prescriptions. So it sort of was, you know, set the seed for a pathway into the position I'm in now. Um I started my professional career back in the late 80s at a company called Burroughs Welcome. Now it was an English company that had a large U.S. presence and was one of the four uh forerunners in antiviral treatment in AIDS and in herpetic infections. And that's where I started my career was working in new product planning and development and then market analytics, um, working in those franchises. Uh, when they were acquired by Glaxo, it became Glaxo Welcome and then evolved into Glaxo Smith Kline. Uh, I was recruited to the Chicagoland area and started at Fujisawa USA, which became Yamanuchi. And there I worked as uh a director of new product planning and business development. You know, there and then and there's a pathway in my uh in my experience that's um fraught with acquisitions. So there's a you know a series of continually getting into companies that increase value and were largely acquired. So uh my last uh role in Big Pharma was uh director of global oncology franchise at a company called Searle, and then became Searle Pharmacia, which was acquired by Pfizer. At that point, my wife said, we're not moving anywhere. We have plenty of moving boxes with plenty of moving stickers that haven't been opened up. Let's stay here and set roots in Chicago. And so I started working in small cap and then startup. And um it just so happens that during that 10 year, I served as a uh external expert in pharma development to the local academic institutions. So Chicago has great research uh institutions, Northwestern, University of Chicago, University of Illinois, Chicago. And I was recruited along with some of my friends and colleagues to come in and review uh the research programs that uh were resident at these various institutions and advise leadership there on basically which ones were ready for spin-out, which ones could use some institutional funding to get them to that point, and then which ones were promising, but at the R01 stage, and then which ones should be further, you know, um supported very earlier stages. And so we would sit, you know, at panels and have various uh researchers and professors present their programs and advise. And my my role was from a development and a commercial aspect. And then there were others that were, you know, toxicology, there were others that were efficacy in various um disease uh backgrounds. And and that gave me a window into the various research programs at these institutions. Um, Northwestern actually recruited me in as an EIR. Um and as part of that, I I made a deal with them that if there was anything ready for spin-out, I got first dips. And it just so happens there were two programs at this stage. These GSK3 beta inhibitors were one of them. And that's how we started actuate is that there was a set of compounds that were invented at UIC that were being evaluated at Northwestern in their uh Center for the Chemistry of Life Processes Institute. And they really showed exceptional promise at a very early stage. And so we build a company around them to spin them out. And that was that was the genesis of where we are now.

Ben Comer:

So you were at Northwestern um prior to the formation of of Actuate. Um, what what could you say about the your experience working in academic medicine in that role? And and you know, were you sort of all the time waiting for an opportunity to get back into industry uh with a company, or or were you kind of tempted to stick around that you liked what you saw? You know, how did you how did you feel about the academic industry divide?

Dan Schmitt:

Well, I you know, I've I'm a longtime industry person. This is my 38th year in in drug development as a professional. The the relationship with the academic institutions was sort of a um avocation because I I really like um working with exceptionally brilliant people. And um the opportunity at Northwestern just presented itself. I I wasn't there, uh you know, I came in and was recruited in as an entrepreneur in residence, but the idea was fully to take advantage of help them prioritize things while looking for something to spin out. So I I have you know the utmost respect for for those for research institutions doing the right work and uh but it was always with an eye towards let's find something and let's build around it.

Ben Comer:

So you landed on elraglusib. Maybe it wasn't called that just yet at the time. I'd probably probably not, but can you um can you talk about how Actuate came together? You know, what steps you kind of took to to in-license the molecule and and form the company?

Dan Schmitt:

Yeah, so um at the time the these there was a an entire portfolio portfolio of molecules that were invented by medicinal chemists at University of Illinois, Chicago. And the inventor was really focused on these um compounds as uh potential improvements for the treatment of CNS disease. So the target GSK3 beta is a known active moiety both in Alzheimer's disease and in bipolar disorder. So uh uh lithium is a GSK3 inhibitor.

unknown:

Okay.

Ben Comer:

Oh, interesting. Okay.

Dan Schmitt:

But it's you know, it's a very dirty compound. It's got a lot of off-target effects that you know patients do not like. So he was looking for to invent something that was more specific, more potent, and um highly lipophilic, so it was more efficient getting across the blood-brain barrier. It just so happened that there was a postdoc that came down from Mayo to Northwestern with an interest in this target but in oncology. And so they the the two institutions developed a cooperative research agreement, and you know, UIC is literally down the block from Northwestern's medical school. And so they they took the compounds, took them into the Center for Chemistry of Life Processes, and evaluated them in their you know, tumor models and in vivo, you know, in in mouse models. And they they turned out to be highly potent against some very uh uh refractory diseases such as models of coleoblastoma, triple negative breast cancer, mesothelioma, um, lung cancers, uh, and it it it was that exceptionality in those very difficult to treat tumors that sort of caught my eye when I was coming in. And I spoke to the head of that institute, Andrew Mazer, and and um said, you know, is is this ready to go? And his his uh advice was, yeah. And I think I might have investors who can come in as well. So he had a relationship with a group out of Texas that had started another company along with him. Um they were always asking him, if you find something else of this caliber, please come back to us. So he came, uh, you know, showed them the data and said, I have a CEO ready to go. And they came in with the funding, and we formed the company uh based on that coalition of science, finance, and executive prowess.

Ben Comer:

Now, did you have to go in in front of those investors and kind of make a case for yourself as, you know, I'm the right CEO?

Dan Schmitt:

You know, how did you approach that? Well, I, you know, I have a long, long background in in pharma development very successfully. Um I have taken, I think I've taken uh a dozen uh products from from preclinical to clinical. I've taken nine from from clinical into to you know registration. I've taken products from pre-registration, post-registration as a lead. I've taken um products from hundred million dollar revenue to a billion dollar revenue as a lead. So I and I've covered all aspects of new product planning, uh market analytics, business development, commercial development, and uh team and uh corporate development and management. So I sort of could cover all bases with a a lot of experience and prowess. And um I think that the package was very uh interesting for them. I had been in small cap and startups prior to Actuate and brought those those uh learnings as well of what to do and what not to do, and and took them through a a process of how we would how we would build the company, how we would license the technology, and and how we would take it forward into full development and hopefully registration. So given Yeah, sorry, go ahead. No, I think I think that that that package was um enough for them to get comfortable and away we went.

Ben Comer:

And given that breadth of experience that that you just mentioned, you were confident that you'd had enough experience to to become CEO. That was, you know, a decade ago now at this point. And I I wonder if uh how I guess how different uh the CEO role has been based on you know what you were thinking about in 2015, about what the role might be like.

Dan Schmitt:

Well, yeah, I I think that starting a company um is different than develop, you know, there's the startup, there's the development, and then there's the running of a public company. So all you know, three major different phases in the in the uh in the the um lifestyle of a CEO. So um starting the company was uh was actually easier because we did have some financing and I could put it through its paces. So for example, the first thing we did, we, you know, a little bit of seed capital, a little bit of seed capital, $300,000. And the first thing I did was have a kilogram of the of the molecule synthesized and then sent it all over the world, right? And what I didn't want to do is commit the sins of the past of others, where they found out that it it really, really works, but only with this one analyst in this one lab. Right. Right. So I I just you know had um you know 100 milligrams here and um and a gram there sent to various research institutions who would be interested in it to do two things. One, does it work in different hands? And two, does it does it work in the same histology or different histologies, and then compare that across the different results. And so what I was trying to do is start on that path of let's kill this thing as soon as possible, right? Fail fast. Fail fast, because I didn't want to find out 10 years later that it you know it doesn't work. So it we sent it across as many labs as we could find, some of the top thought leaders in various institutions and various um disease states. And the drug worked, right? It just it replicated upon itself the uh you know, the promise of the of an a very active compound.

Ben Comer:

Was it uh was that process? So you have this this kilogram of of product that you've gotten made. You you want to get it out to researchers to test it. You know, they may may or may not be familiar with it as a kind of CNS drug. Cancer is kind of a brand new indication. Was it difficult to find people to, you know, to to send it to and to experiment with? What was that process like?

Dan Schmitt:

Well, I you know, it's interesting that the answer is actually no, because uh Northwestern and Andrew and his colleagues are all highly regarded in the scientific community. So we we leverage those networks and the um and the scientific foundation on this particular target to get that interest and have them tested out. So it really um was just a matter of identifying the right programs and the right investigators who would be interested in testing it. And it actually went uh rather uh seamlessly.

Ben Comer:

Excellent. And we're we're talking about um LREGLUSIB, uh is the the the product candidate that we're talking about. You're developing it now for uh a few indications, I believe, with with some other some other indications in planning. Um, can you talk a little bit about how you landed on uh pancreatic cancer for uh a kind of lead indication, if I'm correct, in calling it that?

Dan Schmitt:

Yeah, no, I think that's exactly right. So um there was it just so happens if uh the the postdoc that came down from Mayo, his previous advisor had an interest in this in in pancreatic cancer, this particular target. Um and so there has been a lot of uh uh preclinical uh science developed on the mechanism of action in pancreatic cancer um and the synergies with other standards of care in pancreatic cancer. So um we uh initiated clinical development with a lot of this scientific background done. Um and we we did a a uh master protocol is what it was called at the time, that allowed us to go from standard phase one development, which is when you bring a new uh agent into clinical development, you do a phase one, which is monotherapy and dose escalation. And what you try to do in very, very end-stage patients, um escalate the dose up until you hit a maximally tolerated dose. In that design, as soon as we escalated from dose level three to dose level four, where we thought the therapeutic window would open, the drug would become effective based on our understanding from the animal models, we opened up an eight-arm, what we call basket trial. Yeah, and so so we recruited over 170 patients across these eight arms. All these uh the eight arms were eight different standard of care chemotherapeutic regimens. So, for example, one of those those combinations was gem cytobine and a braxane. So everybody recruited into that arm had to have been shown to be refractory, have failed gemraxane prior to coming in our trial, and then we recruited them in and rechallenged them with that very same regimen plus ELRA to see if ELRA could refer re you know um reverse that lack of that chemo resistance. And it showed that yes, the that we had first of all a very benign safety profile when combining with any of these eight different standards of care, and two, increased efficacy in patients who were previously refractory. So from the from those two aspects, all eight arms were eligible to go into phase two trials. Just so happens the critical mass of preclinical data, the mechanistic uh data, and the data we saw in these refractory patients, plus the fact that we felt comfortable taking our phase two into first line patients based on the safety profile, sort of gave us the the um the uh critical mass we needed to to take that as our first phase two indication. Others are going to follow based on all that work that was done in that basket trial, but it it just the ability to move forward in the first-line treatment in those patients, I think was the the feather on the scale that said, okay, let's go here first. Now, everybody asked that same question because you know, pancreatic cancers were historically drugs went to fail.

Ben Comer:

Right, right.

Dan Schmitt:

It's just very difficult histology to treat. Uh, but you know, we have some prarkable data in first-line patients with this combination.

Ben Comer:

Uh you mentioned uh a couple of minutes ago that the mechanism is, I think you said the mechanism is similar to lithium, which you know, there are known side effects uh like brain fog and and maybe some others that are more serious that make many psychiatric patients um stop taking, stop taking the drug. What would you attribute to the kind of benign safety profile that you have with um LR GluCib, I guess in comparison? And and maybe because the target is different, you know, the side effect profile is different. I don't know.

Dan Schmitt:

Right. I think that, all right, so lithium is, you know, it's basically a metal, but you know, it hits a lot of different targets in the CNS that cause those untoward side effects. LRA and it's the other the other uh drugs in this portfolio were designed to be highly specific. So what we typically do is a we call it a kinase screen. And so there scientists are able to synthesize different uh profiles of kinases and then test the the drug across all of them to see at which contribute which concentration you are inhibiting that those particular targets. Just so happens that LRA is highly specific for GSK. And then the next four kinases that are within that concentration zone are all oncogenic. It's flit three, pym, minc, and my kinase. Then everything else in the kinase screen is a log or two higher in terms of you know IC50. So when we put this drug into the patients, we know that at the doses doses that we're giving them, we're primarily hitting GSK3 and some other oncogenic related kinases. Um, and then you know, having a clean profile on other receptors. It's not preferential for those. So it really is a um an outcome of exceptional medicinal chemistry. And um and I think a little bit of divine intervention house that, you know.

Ben Comer:

Hey, we'll take that anytime we can get it.

Dan Schmitt:

Exactly. I think that, you know, it just it just shows that this is a you know an exceptionally um uh specific and potent drug. The the fact that we were going after CNS disease and that the the um medicinal chemist focused on a you know a backbone known to be, I'll use the words highly lipophilic, which means it crosses, it's it it loves fat, right? So it's it's designed to be um transported across tissue and get into the CNS, cross that blood-brain barrier. Well, it's that lipophilicity that assists this drug in terms of cell penetration. Okay. You know, it it gets across cell membranes quite readily. And in cancer, the the compartment of interest in a in a cancer cell is in the nucleus. And so this drug transports easily across into you know, into the outer cell membrane and then into the nuclear compartment exceptionally. And so it's that combination of specificity and physical lipophilicity that really, I believe, is is um part and parcel to why it's it's such a um an effective agent.

Ben Comer:

You mentioned that uh pancreatic cancer has been something of a development graveyard. Um can can you describe, though, what what the unmet need is in pancreatic cancer and you know what the product's potential might be if it's approved either as a monotherapy or in combination?

Dan Schmitt:

Yeah, so I think historically um the last major advance in the treatment of pancreatic cancer came in the approval of gem cytobine in combination with abraxane, which is you know an albumin-fused taxol. Okay. So gem abraxane was approved in 2012. So, you know, it's been 13 years since the last major approval or major advance in in first-line treatment of metastatic pancreatic cancer. Fulfirinox is a four-drug combination of chemotherapeutics, it's the other standard of care. Recently, Ibsen had their NAB arena tea can approved. Now that's known as onovide. Like NAB taxol, it's an album fused arena tea can. So they they've changed the standard from full Ferinox to now Lyra Fox. And it basically is swapping out regular arena T can for NAB arena T can. The the field is, I guess, somewhat divided on the benefit of that additional, you know, that swap. Not a real measurable increase in overall survival, maybe an amelioration of some side effects, you know. But there's been really no major improvements in terms of survival for these patients in the last uh 13 years. A lot of shots on goal, not very many successes. I think the field is is evolving as we speak. I think that uh it will continue to be a combination uh treatment uh uh uh field. Um this GSK inhibitor, LR glucose, certainly will have a place. There's RAS inhibitors that are being developed now uh for treatment of pancreatic cancer that are promising. There's a a um a mechanibritor program that is developing. We'll see how well that goes. Um, so there's interest and new developments on the come. These have all been tested in second line therapy, they're just starting to be developed in first line therapy, but I think the KOLs, the people who know and and are participating across all these trials are telling that L-reglusive will certainly have a place as a backbone therapy. It combines well with others, it also um has a compensatory um mechanism along with either RAS or MEC. So they they downregulate certain pathways in these tumors, and those tumors can practice escape by evolving away from those pathways. Well, the GSK pathway is one of those compensatory pathways, and if we shut down both RAS and uh GSK or MEC and GSK, we expect to see even better outcomes than one or the other. So I I see the field is still going in combination treatment, and I see that LRA would have a place there.

Ben Comer:

Yes, and we we've already mentioned, you know, you're you're looking at several potential indications, others uh potentially in the wings to start development uh at a later date. Uh I want to ask kind of a more of a business question, which is, you know, what and and you've just talked about the possibilities for combinations, which you know opens up, you know, a lot of different kinds of opportunities, but what can you say about, I guess, the pros and cons of a of a singular product focus for a biotech company? Uh, you know, um, versus, you know, I don't know if you've ever considered kind of bringing in some additional molecules or additional products. Um, it doesn't look like you have to date from what I can see, you know, on the on the pipeline on the website, but what can you say about, I guess, a single, a kind of single product focus uh and and the pros and cons, you know, um, what are some of the risks associated with a single a single product approach?

Dan Schmitt:

Well, I think that the you know, again, uh obvious, right? If if you uh If you, you know, fail fast and then you'd fail completely, right? And you start over. I think that there are, you know, there's uh pluses and minuses on both ends. Um, we've been able to advance this program through over 500 patients um and have spent a little over $100 million doing that. You know, um, having a broader portfolio of products uh certainly would expand, you know, do risk mitigation would bring a broader set of opportunities and a broader set of challenges and a broader set of financing requirements. So um I think that being focused on this drug to where we are now and getting it into registration mode may actually expand that opportunity to bring follow-on compounds as we go forward. But right now we're entirely focused on a this is almost a pipeline and a molecule. So that's that and that's a way we're addressing it.

Ben Comer:

Uh Actuate went public uh by an IPO uh in August of 2024. Um can you describe, I guess, that that experience? Uh and you know, kind of your your thinking at the time.

Dan Schmitt:

Yeah, so I I you know, I joke. I I say everybody should do an IPO once, nobody should be forced to do it twice. Um it is a great learning experience. I think that you know, we started seeing the the remarkable responses in the the phase two program um in late 23 and knew that we were headed towards bigger and better things. Um and I'm I'm sure you've been around, you understand that, you know, maybe the 21 to 24, 25 period in biotech was extremely difficult. Absolutely. There were there were JP Morgan's where you looked and every sad face you knew was a biotech CEO. Um uh so we, you know, we um tried to remain private as long as possible, have the best uh return for our shareholders as long as possible. Um, but going into larger stage clinical development meant we we really needed to go into the public forum to start you know attracting that kind of funding. And it looked, you know, the 2023 was an exceptionally challenging year for biotech. The beginning of 2024 was it looked like there were some green shoots in terms of IPOs, um, in the particularly in the first quarter. And we started the process in you know, the February, March timeframe of that year. And by the time we got to the IPO and in the May, June timeframe, the market had just turned. I mean, it just everything started shutting down, cooling off. And but we were already committed at the time. And so we just pushed forward and got the IPO done in August of 24. Um it was uh, you know, it it challenged the uh the uh the uh will of those participating. But we we got it done, we got public, and now we're able to take advantage of the public markets. So I I tell um that's why I say everybody should do one once and nobody should be forced to do it twice. But I I think I'm in a much better position now. Um understanding capital markets, uh, you know, accessing the capital markets and understanding them. Um so it's made me a much more well-rounded leader for the company.

Ben Comer:

Yeah, and um maybe following on that point, I want to talk about you know, efficiency and efficient operations. Uh I wonder, you know, did you have to take any any specific actions like in terms of clinical strategy or or pipeline, you know, to keep moving forward amid you know a very muted and restrained uh financial environment, let's call it? Uh, you know, what what kinds of decisions did you have to make, you know, to to keep the company going in this in this really challenging period?

Dan Schmitt:

Yeah, I think it's so um we've always operated the company on a on a an exceptionally efficient basis. Like I told you, we we we we got into 500 patients and and just about $100 million. And you think about going from zero to that site type of clinical program, I like to I like to kid that some of the bigger biotechs spend more on coffee cups than we do on total RD, and we're we're moving faster and better. Um you know, we've kept the the um headcount lean on FTEs internally. I've been very blessed that in my career I've run across people who are exceptional in their capabilities, um, really understand how to get things done and are a pleasure to work with, you know, who I trust and who trust me. And so that's you know, there are those people in your career you come across and you just hold on to. And that's what we've been able to build this company around. We have, I also have an exceptional stable of uh best of breed consultants that we use on a as needed basis. Um, and that helps us keep our costs in line, that we're not carrying you know, high rent on a headquarters, and we're not carrying a lot of FTEs unnecessarily. Um and we've been able to advance this um on a on a highly efficient basis. Um when the money uh when the markets became tight, we focused on those programs that we could advance quickly and to meaningful uh you know inflection points and you know uh look at others to put into the timeline at a time when we felt the funding would be able to come in. And so you know, you you have to operate understanding what's what the opportunity set is and how to stage it so that you can you don't get ahead of yourself and you know have to put things on hold or uh or go halfway with things and then have the money go sideways. So we understand how to do drug development. And I think in the in the C suite and then the V suite, we have probably over 150 to 200 years experience. And and we know how to work things in a small company that's different than a large company type approach.

Ben Comer:

Do you have a process or or do you consider you know outlicensing specific programs uh with this drug? Is that something is that something that you've you know looked at or continue to look at at this point?

Dan Schmitt:

Well, I think that um ultimately um it's not so much outlicensing, but it would probably be more MA focused. Okay. So what we wouldn't do is, and I call it splitting the baby, right? So having one company have these indications and have another company have these indications, that never really works out well because it's a single molecule, it's a single safety database, you know. Right, you know, you you've you've got to live with the outcomes of the trial, not only efficacy-wide, but safety-wise. And that bleeds across all indications. I think that there's always a potential to look at maybe licensing a particular geography, you know. So, for example, Latin America or Asia Pacific, those are always opportunities. And my BD background um allows me to sort of stage our discussions uh based on the development of the program. And, you know, I've socialized this program as we started moving into the clinic so that I could one get the input from you know large pharma about we like what you're doing, what we'd like to see is so you can understand where they're coming from and what what would drive them to to make the kind of deal that you would like to have. So I've been doing that for the past couple years. Um and then you know, building this program so that if we desire, I could build a company around this. Right. So it gives me strategically, it gives me a better um seat at the table for for BD discussions, where you know, Mr. Pharma really would like to have this in your hands, but you're gonna have to make me a deal because I can do this otherwise for my investors. So, you know, it's a it's a long, it's a long-term game, but I I think that it's a very promising for actually.

Ben Comer:

You mentioned uh keeping a lean internal head count. You also work with a a number of consultants. It sounds kind of like at will or on a fractional basis or however you want to call it, but they're not they're not full-time employees, which means that you're relying pretty heavily on some partners, um CDMOs or or API providers. I wonder, and you you know, you talked about your success in enrolling clinical trials. Um how do you think about I guess how do you get the most out of those relationships? If there's uh maybe there's something to be said about choosing, but how do you get the most out of out of those relationships and and what, if any challenges have you faced in in kind of outsourcing a lot of that work?

Dan Schmitt:

Right. So I think that uh, you know, we've been very fortunate to have um have uh evaluated and and selected some excellent providers. So for example, our API is currently manufactured by Pharma. It's Chinese uh uh based, but they're they're onshoring manufacturing into the U.S. as we speak. So we're looking at transferring the API manufacturing into the U.S. But with Pharma and in Pharma, Pharma is well known. Major players, Pfizer and others, have you know, so they're they're well known and have a great deal of experience and have been actually very good to work with. Um for the final product manufacturing, we actually have two manufacturers in the U.S., which came in very helpful during the COVID era. Um, because invariably one plant would be down or run out of materials such as glass vials or stoppers. So we had parallel tracks at University of Iowa Pharma and with LSNE, and we can and we've um evaluated and um have run multiple, multiple, multiple batches at each that keep you know passing specs. So we're good that way. Um we have selected uh what used to be Bend Biosciences for an oral tablet manufacturing process, and they've been excellent. So it's really um exceptionally well run from the manufacturing issue uh standpoint on multiple fronts. Uh Rich Kenley, who's our VP in manufacturing, is you know, a long time uh a long time pharma veteran. He's brought in consultants under him that uh are also exceptionally experienced. And uh it's actually the probably the uh the the program that that keeps me up at night the least. Right? I just don't it's it's like clockwork. So I we're very, very uh fortunate to have Rich and his team running that and and it gives me no angst whatsoever.

Ben Comer:

Um so you have uh you Farmer on partner in and AP uh in China there on in the process of onshoring uh to the U.S. Um I I you know I'm I'm kind of looking at the federal policy perspective from an outsider's view. And so I I often wonder, and you know, when I when I talk to company executives, I I like uh recently have been asking, you know, how much of this is is really felt versus is kind of headlines and it is actually making a substantive impact on your business? Uh I'm I'm curious about you know the federal policy environment right now. Um, you know, with back and forth with various tariffs, uh, you know, with China and obviously many other countries as well. I mean, is that at this point impacting your business in any in any real way? Are you preparing for it to potentially impact your business? And so you'll be ready to kind of shift. Where where does that where does that stand? How do you think about that as as CEO?

Dan Schmitt:

No, I think uh you have to be prepared for for this. Um, you know, is to to not respond is it would be foolish, right? And so yeah, we're we are evaluating the onshore and the API. Everything else is manufactured here in the U.S. So we have that that plan being executed. Um the tariffs haven't hit us because we're we're RD based. You know, we're not and so that that's not affecting our business. I imagine that by the time we are, you know, sort of commercially focused, which will be, you know, sort of in the the 27 to 29 timeframe, um, uh I think the dust will settle a little bit more and the picture become a little bit clearer of what needs to be done. And uh we'll be prepared for it at that time. But right now, we're our response is okay, let's on, let's look at the best way to onshore the API. Everything else is here.

Ben Comer:

Uh another recent change at the federal level at the FDA, Richard Pazdur is becoming now the head of CEDER. I think for now he's also still head of the um oncology center, center of excellence. Given that, you know, you're you're working in oncology. Um, do you well well let me ask this are are you will you file your drug? Are you working with CBR or CDR?

Dan Schmitt:

Uh yeah, we're we're a small molecule, so we are in CDR. Um Richard brings you know a really uh solid background from an industry perspective. We we think he would be great. Um his team actually put out a manuscript a few years ago called uh irreconcilable differences, the divorce between uh PFS and OS in oncology clinical trials. So basically, you know, progression-free survival and overall survival. And it was a a review of a number of cancer drugs that had been approved on these surrogate endpoints that later showed no benefit in survival. Right. And then a review of some I.O. drug clinical trials that showed no benefit on progression free, but significant benefit on overall. And the the gist of this article is survival is the end point. Well, our cancer clinical trials are focused on survival. And so we welcome his his perspective because it just so happens that that's our perspective as well. I think he's very well respected. I think that the the um the challenges uh inside the FDA are uh environmental and are real, but I'm hopeful that he'll bring some calming to the waters as as the head of Cedar.

Ben Comer:

Um yes, I I don't I don't think it's um wrong to say that uh Pastor is probably one of the most beloved uh government officials we're working in the agency and has been for uh for quite some time. Um so uh yeah, that that's all all to the good for him kind of uh elevating up to the head of Cedar. Um we're uh we're coming up on the end of uh 2025. Uh we've talked about this difficult period uh in terms of uh the financial situation for biotech. Are you seeing more of those green shoots now start to pop up, uh Dan? I mean, do you are are you expecting a better year for IPOs and deals next year? Uh what do you think?

Dan Schmitt:

I think the we're hopeful. I think the industry is hopeful right now. I mean, if you look at the XBI versus where it was six months ago, I think there's deals being done, there's um acquisitions, uh you know, re-greening the environment a little bit. More generalists are coming into biotech, uh investment, you know. So all of the there seems to be some momentum and trade winds pointing to the positive. Um and and we're hoping that continues. So, and and that's the way we're focused on it as well. We have momentum in our programs, we've got, you know, um some key uh anal uh inflection points coming up, and we're we're uh we're working to take advantage of of our pro our progress and the market conditions at the same time. So, you know, it's looking like a promising uh near-term future. And let's just hope that things continue that way.

Ben Comer:

Uh we're coming up to the end of our time, but maybe we can um just just finish off following on what you've just said, Dan, your key priorities right now. Um, what what are the the you know the development milestones or or or other key priorities that that you're most focused on right now?

Dan Schmitt:

Well, so we have a number of opportunities in front of us. Um our investigators will be presenting at ASCO GI, which is in January in San Francisco, on the on the you know, sort of the the uh final data of our randomized phase two trial in metastatic pancreatic cancer. Um, we'll be meeting with the regulatory authorities, both EMA and FDA, at the end of the first quarter to discuss um registration pathways and and what's required and designing a uh registration, a global registration study for pancreatic cancer. We'll be initiating oral uh treatment in patients in the first half. So we've done everything with an IV. We have an oral drug that has exceptional properties, exceptional properties. Um and that will be going into the clinic in the first half. We have a Ewings program uh for relapse refractory ewings sarcoma, and we're working with international um groups to advance that to a registration study by potentially by the end of the year. So um oral will be going into primarily uh first into refractory metastatic melanoma and could also be accompanied by metastatic colorectal and non-small cell lung cancer patients. So there's a lot of opportunity sets between us, you know, from from where we are till the end of next year with a lot of inflection points coming and a lot of positive uh momentum to support them. So it's gonna be a busy year.

Ben Comer:

Thank you so much for coming on the show. I I really appreciate it. Enjoyed speaking with you.

Dan Schmitt:

No, Ben, it was a pleasure. I appreciate the opportunity and and I appreciate your time.

Ben Comer:

We've been speaking with Dan Schmidt, president and CEO at Actuate Therapeutics. I'm Ben Comer, and you've just listened to the Business of Biotech. Find us and subscribe anywhere you listen to podcasts, and be sure to check out new weekly video casts of these conversations every Monday under the Business of Biotech tab at lifescienceleader.com. We'll see you next week, and thanks as always for listening.

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