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Health Care

Turning the Pharmaceutical Model Upside Down

How a nonprofit gave birth to a company that aims to disrupt Big Pharma

Published: Wednesday, November 27, 2019 - 12:02

The company Grace Science was born through an inversion of the normal business sequence. Typically, if an entrepreneur launches a startup and it succeeds, the founders will create a nonprofit, declaring, “We want to give back.” In this case, the nonprofit spawned the startup.

The company’s inception accelerated when Matt Wilsey first met with Carolyn Bertozzi in 2015. Bertozzi is the Anne T. and Robert M. Bass Professor of Chemistry and professor of chemical and systems biology and of radiology (by courtesy) at Stanford University.

Wilsey’s daughter, Grace, has an ultra-rare disorder caused by a mutation in a gene known as NGLY1. Only 54 people in the world have been diagnosed with the disease. In 2014, Wilsey and his wife, Kristen, created a nonprofit, the Grace Science Foundation, in their quest to find a cure. The foundation has raised about $9 million to date.

Matt Wilsey knew that he had to start small with a foundation and then use its research to create something bigger—ideally a drug that could be monetized to help find a cure for NGLY1 deficiency and other diseases that are too rare for the profit-centered pharmaceutical industry to pursue. He also had to prove to investors that he could operate at a high level running an organization steeped in science and medicine.

By the time Wilsey reached out to Bertozzi, he’d already met with (and, through his foundation, funded) dozens of scientists and medical experts, and their research was showing that the NGLY1 mutation was somehow disrupting the process that enables sugar molecules to be removed from proteins in cells. The process is crucial to a cell’s survival.

Wilsey reached out to Bertozzi because she’s one of the world’s leading experts in the field of glycoscience, which studies the way that sugar molecules are attached to, and detached from, proteins. Wilsey didn’t waste any time getting to his point: He believed that her expertise could help his cause, and his foundation was poised to finance a project in her lab.

Bertozzi said yes and dove in. Within months, she and her team discovered that one of the NGLY1 gene’s primary functions is to activate a little-known “transcription factor” known as Nrf1. Transcription factors are proteins that make sure certain genes are activated to perform important tasks. As it turns out, Nrf1 is so crucial to the survival of cells—all kinds of cells, but especially neurons in brain and muscle tissue—that its origins date back to the beginning of cellular evolution.

“It’s an ancient, essential pathway,” Bertozzi says. “Slime molds have it. Yeasts have it. Plants have it. Worms have it. Mice have it. Humans have it.”

When it became clear that Nrf1 doesn’t work without a functional NGLY1 protein, Bertozzi quickly realized that the finding had implications beyond curing NGLY1 deficiency. Other researchers had been trying to inhibit Nrf1 as a way to destroy cancer cells but hadn’t had any success, because Nrf1 is a transcription factor, and transcription factors are hard to manipulate with drugs. They’re regarded as “notoriously undruggable,” Bertozzi says.

Enzymes, on the other hand, are druggable. And NGLY1 is the enzyme that controls Nrf1.

“That’s when we were like, ‘This is an oncology thing here,’” she says.

Bertozzi’s team eventually figured out how to use drug-like molecules to inhibit NGLY1 activity, which in turn inhibits Nrf1 activity, which in turn makes certain cancer cells easier to kill.

(This is essentially the opposite of what other Grace Science Foundation researchers have been trying to accomplish in their efforts to cure NGLY1 deficiency. Their goal is to activate rather than block NGLY1’s processes and thus reverse the mutation’s cell-killing tendencies.)

The cancer-killing potential of a Nrf1 inhibitor prompted Wilsey and Bertozzi to launch the for-profit company Grace Science in 2017. To date, the startup has raised $7 million from investors, and Wilsey is steadfastly optimistic that they’ll have a drug ready for clinical trials by 2021.

Finding a cancer treatment would be great, Wilsey says, especially if it saves lives and turns into a revenue source. But he stresses that the business’s central purpose is not to turn profits for shareholders. The idea is to generate revenue that can be poured back into research. Above all, Wilsey wants to find a cure for his daughter and other NGLY1 patients—and perhaps unearth treatments for other rare diseases that don’t get much attention from Big Pharma.

“The problem facing ultra-rare diseases is the lack of R&D dollars,” Wilsey says. “Many pharmaceutical companies avoid rare conditions because the markets are so small. Grace Science will always invest in rare-disease R&D and make connections with more common diseases. That’s core to our mission. We’ll commercialize findings where we can, but our goal is to get safe and effective therapies into people as quickly as possible. If we do that, the sky’s the limit, and we’ll be successful on several levels.”

First published Oct. 18, 2019, on Stanford Business Insights.

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Steve Hawk

Steve Hawk is an editor at the Stanford Graduate School of Business.