It is our ambition to bring new innovative compounds forward in development and to broaden the project pipeline. This is a challenge for a small company but can be achieved by a healthy mix of proprietary projects and partnerships. We will continue to look for partnerships with large pharmaceutical companies, as well as with other biotech companies, but is also evaluating early risk­sharing collaborations and later stage inlicensing opportunities.

Drug discovery collaborations
The typical pharma/biotech collaborations provide upfront payments, research funding during the joint drug discovery phase, and milestones and royalties on sales in the event of successful development and marketing.

The pharmaceutical company provides the financial resources and additional competences required to bring the product to the market. In addition, the collaboration validates the quality of the research in the biotech company. Karo Bio’s ongoing partnerships with Merck and Wyeth represent collaborations of this kind.

Risk-sharing collaborations
Karo Bio is prepared to enter into risk­sharing collaborations in early projects for which internal resources are not sufficient to drive the project forward.  This allows for a larger number of projects to be pursued within the financial framework of Karo Bio.

In addition, Karo Bio can benefit from access to the partners’ complementary competencies. The collaboration with Zydus Cadila is the company’s first collaboration of this type. Karo Bio is primarily involved in drug design and in vitro characterization while Zydus Cadila is responsible for the chemical synthesis and in vivo characterization of compounds. Both parties cover their own costs. The ambition is to build value and outlicense the project at a later stage.

Inlicensing
Karo Bio conducts in-house drug discovery in the field of nuclear receptors with the intention to generate new projects and broaden the pipeline. However, the company is also investigating alternative strategies to expand the pipeline. Inlicensing of compounds in late preclinical or clinical development stage represent an attractive means to achieve a balanced mix of projects in the portfolio.

The importance of academic collaborations
Whereas Karo Bio has its core expertise in drug discovery and development, academia is a stronghold of basic research. Karo Bio has a long tradition of successful collaborations with academia. In these collaborations, Karo Bio provides tools and competencies of importance to perform basic research, and in return the company gets an increased insight into the biological mechanisms that can lead to new, or validate existing, treatment concepts.

The Karo Bio research foundation
In connection with a management buy­out of Karo Bio from the previous owners in the early 1990’s, a research foundation was established for the purpose of funding academic research in Karo Bio’s  field of interest. The value of the foundation’s assets has grown over the years, and several grants were awarded during 2007 and 2008.  The insights gained from the awarded research projects can be of importance for academia as well as for Karo Bio.