1. How to boost R&D for a low-cost, point-of-care rapid diagnostic test and better drugs for tuberculosis Meeting with Médecins Sans Frontières Geneva, April 11, 2008 Giorgio Roscigno CEO / FIND

2. FIND VisionVision To impact quality of life of people suffering from poverty-related diseases MissionMission To develop rapid, accurate, easy to use and affordable point of care diagnostic tests to help fight diseases that disproportionally affect the poor

3. FIND’s Operational model FIND is a not-for-profit (US 501 c3) Swiss Foundation Co-invests with partners in order to lower risk, reduces break-even time, and significantly reduces the barrier for a commercial company to invest and moves the technology along the value chain. As a not-for-profit, FIND can leverage its investment against the affordability of the product for the FIND- Target Markets in the High Disease Burden countries and low income countries  Public sector and private not-for-profit sectors

4. Developmen t Evaluation Demonstrati on Moving from development to impact Adoption into global policy Collecting evidence for scaling up Impact on poor patients

5. CONTEXT Limited infrastructures POLITICAL Rights Influence Freedom SOCIO-CULTURAL Status Dignity HUMAN Health Education Nutrition ECONOMIC Consumption Income Assets GENDER Poverty is multidimensional WHO/OECD, 2001 Tests should ensure equity of access (Patient centered approach) Tests must be cheap, if not free (Public/private no profit) Test should work within local conditions (Part of the demonstration phase/ knowledge sharing)

6. Equity and societal cost effectiveness analysis of new Dx in Lesotho Scope of the study To synthesise an approach for assessing impact of new Dx tools and modalities on equity of access to TB diagnosis Specific objectives To develop locally appropriate tools to describe poverty profile and geographic distribution of TB patients To assess main barriers to TB diagnosis in Lesotho To assess health system costs of new TB diagnostics To assess the cost effectiveness of new tools

7. Source: The Treatment Action Group (TAG) report on tuberculosis (TB) research and development (R&D) in 2006 Detection of TB still relies on microscopy  Only one quarter of TB cases in the world are ever really diagnosed and reported as smear positives  New technologies, especially molecular-based, have promising potential  But spending on TB R&D diagnostics currently represents less than 8% of TB research funding

8. Resolution testing (screening negative drug resistance, e.g., culture) Clinic / Health Post microscopy symptoms Peripheral Lab Fraction of patients seen Reference Lab Surveillance Reference methods Network supervision Surveillance Screening Primary care Passive case finding Detect and treat 5 % 10 % 25 % 60 % culture Patient-centered approach based on a tiered level laboratory Regional Lab FIND budget spending 75 % Detection Resolution 25 %

9. FIND / TB diagnostic pipeline Health Post Referral Hospital Microscopy Center 2012 2007 2009 2010 Health Level Manual NAAT LED Microscopes Liquid Culture Rapid speciation Projects 2011 2008 Rapid Molecular DST Interferon Gamma Assays Fully automated NAAT Evaluation Demonstration Eval Demonstration STAG Access STAG I I AI A A Access Demo Feasibility & Develop Feasibility & Develop I Enose Demonstration Eval Develop Feasibility & A A Imp I Acc I STAG A Acc AB detection AG detection Feasibility & Development STAG Demonstration Evaluation Eval STAG Access Impact Access Acc Imp Access A Impac t A STAG

10. Gaps in R&D (1) The slow road to microscopy diagnosis of TB  The starting-point in the fight against all contagious diseases is the obligation to report, because without this most cases of the disease remain unknown. Robert Koch, 1905  A new POC TB Diagnostic tool could save up to 400,000 lives per year. Nature

11. For Molecular Testing the main driver is to the POC FROM: centralized big laboratory machines TO: self-contained simple-to-use chemistry & equipment Home Referral Hospitals Rural and Regional Hospitals Health Centers or Outpatient Clinics Doctor’s Office

12. Two key areas: Biomarkers & Technology No well-defined molecular targets (except DNA) Dx target identification ongoing –Various “Omics” approaches taken Detection technology dependent on type and number of markers employed –LFI most likely technology for POC but limited by sensitivity and number of analytes Mtb Antibody / Antigen Dx

13. Gaps in R&D (2) TB Biomarker Research  Lack of systematic approaches to marker discovery: no consensus on TB biomarkers  Lack of reproducibility of preliminary biomarker results (e.g., antibodies, LAM antigen)  Probable causes of failure and bias:  opportunistic approaches  poor understanding of in vivo antigen processing  lack of appropriate detection technology  inefficient sample preparation procedures  poorly documented clinical samples

14. Biomarker discovery: –Academia Immunology NAAT targets Biomarker validation: –Commercial partner Extensive clinical trials Prototype products Boosting R&D for a low-cost, point-of-care rapid diagnostic test Boosting R&D for a low-cost, point-of-care rapid diagnostic test: bridging the gaps Appropriate technologies with appropriate partners

15. Mtb Antibody / Antigen Dx Discovery Mtb Antibody / Antigen Dx Discovery POC by combining biomarkers and technology Academic research (UCI) leads to novel, high throughput protein expression technology FIND technology scouting identified this outstanding opportunity to close serology target gaps UCI spin-off founded ImmPORT Inc., who became a FIND partner This PPP generated first ever whole Mtb proteome array chip to identify unknown antibody targets serving as key reagents for POC development Partner company attracted by FIND expertise and short term cash rather than long term advanced purchasing mechanism

16. How to bridge and which incentives for novel biomarkers and appropriate technology Biomarkers  High risk / high cost  Academia driven  Industry focused primarily on big markets (e.g., cancer, diabetes,...)  Bioinformatics challenges  Validation and reproducibility are critical issues Incentives:  Publications, IP, additional R&D funds  Prizes  Research reagents contracts (Ab/Ag)  Small business grants linking academia and companies Technology  Big Dx companies only in profitable segments (sequencing, arrays)  Biotech / small-med. tech. as major drivers of innovation (short to medium term) but often prohibited by short term goals of VCs (profit) [ImmPORT]  High profile research institutions and military (MIT, DARPA) may provide “out of the box” solutions (medium to long term) but TB dx applications are typically not an “A” priority [Cepheid] Incentives:  “Public” Venture Capital to support small- med companies  Prizes to establish market value of technological platform  Advanced market commitment (larger company)

17. IVD Industry operates a different business model from Pharma industry Far more sensitive to cash flows; IVD projects take only a few years and product sales cash flows are critical in the short term 1.Technology cycle times are only a few years; the need to get to the break-even point is greater 2.Replacement products from competitors eat into margins and profit far earlier than in Pharma 3.IP is important but linked to shorter product lifetimes;  results in limited ROI on IP

18. Is there a role for novel market incentives in catalyzing IVD Development Projects? The « Carrot » of a « Prize »? –Academia: doubtful, since main driver is peer recognition and publications – money is always welcome –Public VC for commercial partners: most likely, since it helps project « hurdle rates » and break-even points –For large companies: doubtful, as it must be sufficiently significant to actually be an « incentive »; i.e. $ in millions –The Advance Market Commitment: no, not a driver for IVD companies as cash flow is king and most IVD’s are not « commodity-like » possibly attractive to larger DX Co with mature technologies.