CRO Navigates Tough Preclinical Testing Stage for Cos.

By Jared Whitlock

BIOTECH: Challenges Are Big And Small in Testing on Animals

Explora Biolabs is part of San Diego’s biotech cluster. But CEO Richard Lin likens the company to a hotel.

Photo by Jamie Scott Lytle

 

Explora Biolabs CEO Richard Lin at the company’s Sorrento Valley headquarters. The company has five labs in San Diego and two in San Francisco for preclinical testing on mice and rats. Typically biotechs taking their drug before the FDA must first show how their treatment works in animals.

Rent one room or more, depending on the size of the party. A cleaning service stops by every day to tidy up the joint. Bigger spaces — penthouses, if you will — run extra. But a big difference between San Diego-based Explora and, say, the Ritz Carlton: rodents are welcome.

Explora is in the business of preclinical testing on mice and rats. It runs a “mouse hotel service” — essentially day-to-day care — and for extra designs or oversees lab studies.

In a field that’s highly regulated but shrouded in secrecy, Explora’s services are in demand, particularly among small companies focused on early-stage research, a hallmark of San Diego’s biotech scene. Since forming in 2004, the company has gone from a two-room lab to seven locations, of which five are in San Diego and two in San Francisco. Three of these facilities came online in the last 17 months.

FDA Regulations

Typically, biotechs taking their drug before the US Food and Drug Administration (FDA) must first show how their treatment works in animals. But in-house testing can be pricy, so companies contract with Explora, which achieves scale through buying equipment in bulk.

“We free up a lot of management overhead for scientists and our client companies,” said Lin. “But what’s more important than money is quality. That’s why we call ourselves Ritz Carlton, not Motel 6.”

As evidence of quality, Lin during a recent tour of Explora’s Sorrento Valley headquarters pointed to his nose, noting the smell of rodents doesn’t hang in the air. Why? Lin motioned toward a long checklist plastered near the doors. It’s a daily reminder for the maintenance crew to replace cages, as well as check factors such as lighting and airflow.

Time Issues

“In a company, everyone is busy. Scientists have no time to manage technicians. Alternatively, companies might say, ‘We can have scientists change cages and sweep floors.’ They end up not doing a good job,” Lin said.

Peering into the rooms, mice in clear plastic cages scurry on brown bedding. Workers don white coats and blue mesh booties over their shoes to avoid contamination.

About 95 percent of all lab animals are mice and rats, due to convenience, and because they’re genetically similar to humans, according to the Foundation for Biomedical Research. Data from animal testing is presented to the FDA, which must sign off before a company can start studying a drug in humans.

As the FDA’s website notes, “There are still many areas where animal testing is necessary and non-animal testing is not yet a scientifically valid and available option.”

Politically Sensitive

But Explora exists in a politically sensitive area that few publically discuss. Several organizations declined an interview on the state of rodent testing, including UC San Diego’s Institutional Animal Care and Use Committee, which is charged with ensuring the proper care of animals used for research.

Yet advancements could one day reduce or eliminate animal testing. Boston’s Emulate developed technology that mimics the brain, liver and more through an “organ-on-a-chip” the size of a USB stick. In April, it partnered with the FDA to examine the technology’s potential.

In San Diego, Organovo aims to show its 3-D printed tissues are more accurate than animal models at predicting a drug candidate’s toxicity.

Lin views such developments positively, and he’s open to pivoting once the technology matures.

But, he said, the reality is that animal models are still required in many instances. He added where Explora makes a difference is in care of the rodents, and running strong studies that use as few mice and rats as possible.

In-house testing can be cost prohibitive, which Lin understands well, having worked for several small biotechs. In 2004, he sought a testing business, but came up empty handed. Explora was born from that need.

Setting up a rodent lab demands upward of $100,000 in new equipment, along with maintenance, energy and labor costs totaling as much as $25,000 monthly, according to Lin. That’s particularly expensive considering a company may only need testing here and there.

Explora has scale on its side. Companies might pay $5,000 to $15,000 a month for a 250-square-foot room, depending on the frequency of research and if they share space. Another factor: whether researchers come onsite to conduct preclinical research or turn that over to Explora’s scientists.

The company is bound by strict agreements not to divulge clients’ information, considering that cutting-edge research could mean millions later.

Growing Footprint

Its labs have 25 employees. Lin declined to share revenue figures, but Explora’s footprint keeps growing. It has a facility in Sorrento Valley, Mission Valley, La Jolla and two in Torrey Pines Mesa. This year, Explora further expanded with two labs in San Francisco.

All told, the company’s footprint covers 68,000 square feet of lab and office space.

“To our delight, there’s not a lot of competitors there,” Lin said of San Francisco, noting he’s eyeing further expansion there. He added there’s little competition in San Diego, speculating that’s on account of high startup costs, and would-be competitors view the company as having a lock on the market.

Early on, Explora rode a wave of smaller biotechs outsourcing services to CROs, or contract research organizations, with specific areas of expertise. Lin is currently the chairman of Biocom CRO, with the aim of boosting collaboration among these companies.

Have Lab, Will Travel

Explora has also found success with “in-sourcing,” including designing outside labs, which is more complicated than it might seem.

“The airflow is very important, as well as a stable environment that meets the regulation or accreditation standards. And the rest of it is workflow. Does it make sense for scientists to go this way? Also, we are studying diseases, so there’s potential contamination to avoid,” Lin said.

In addition, Explora scientists go to companies and manage their labs so they don’t have to buy expensive equipment. The mouse hotel services — not to mention research offerings — now travel.

“Everything we do in our facility, we transfer to theirs.”