Russia is Tapping into U.S. Biotechnology
By Katya Soldak
Twenty years ago a Moscow scientist Michael Fonstein moved to the United States to make his mark on the international science scene. Later, together with Andrei Gudkov, Ph.D., and Yakov Kogan, Ph.D., he started a successful biotech company, Cleveland BioLabs, which developed medicine for cancer and radiation syndrome treatment. After years of research, receiving grants from the US government, going public (they trade at NASDAQ: CBLI), the scientists decided to move a substantial part of their activities back to mother-Russia. They think that speeding up the process of developing their drugs would be better for all potentially treatable cancer patients—and for their businesses.
“The regulations are more flexible in Russia,” said Fonstein, Ph.d, President of Cleveland BioLabs. “The process would still take three or for years but it’s not ten or fifteen.”
CBLI’s move is part of a trend for biotech companies—transferring their research and clinical trials outside of the US, to Eastern European countries and to Asia, but the company has also become part of the recent effort by the Russian government to invest in high-tech companies.
CBLI has been developing its product over the past eight years under FDA control. “It’s a very long process,” said Fonstein. “We are doing quite well, our first drug is getting close to going on the market. But life is short, and the process is long. Therefore we are trying to speed up the process of developing the drugs.” He said that together with his partners, he’s taken a closer look at Russia, a country that hasn’t really had a chance to develop many bad practices of drug development, unlike in the USA and Europe.
Today, the team has opened two subsidiaries in Russia and received substantial financing from Rusnano, a former Russian state-funded company. CBLI is working with five molecules that are still in the early research phase and hope to combine the advantages of American and Russian platforms in order to bring the medicine to market faster. They seem to be in a good position: having the support of the Russian government, and knowing well the field where the research is conducted.
Companies looking to reduce research-related costs and speed up development understand that it’s in their interest to work in an environment that provides conditions for quality research and high standards.
CBLI is no exception. They’ve received significant funding from the US government in the past. Only recently the Journal of Pharmacology and Experimental Therapeutics has published a new study that identifies one of Cleveland BioLabs elements efficient as a radiation countermeasure, highlighting its radio protective effect. This summer CBLI has signed $4 mln dollar contract with the Ministry of Industry and Trade of the Russian Federation for development of one of CBLI’s drugs, in Putin’s recent effort to invest in tech companies. Putin’s initiative to strengthen Russia’s high-tech sector is not without conditions: companies that accept Russia’s funds must transfer their technologies to Russia and work with local scientists.
Eastern Europe, former Soviet Bloc, as well as China and India have become a growing playground for the medical research industry. With all the advantages, there are also challenges. Ezzart Kordab, of the Kriger Research Center in Canada, wrote in his research publication about clinical trials moving overseas that often changing regulations, missing data and sometimes inexperienced investigators, can make it difficult. But with a reliable clinic the research can be conducted successfully. Many national clinical studies have been conducted in Russia over the past ten years, and the number of violations during the FDA inspections in that region was minimal.
For the scientists and for drug marketplace to become more global and integrated seems to be a good thing: surely, it’s good for their business; but for potential patient it means a chance to receive a cure faster.