Transcription of Finance News Network Interview with IQNovate (NSX:IQN OTC:IQNDY GXG:IQN) CEO and Chairman, George SyrmalisDonna Sawyer: Hello I’m Donna Sawyer from the Finance News Network and joining me from IQNovate (NSX:IQN OTC:IQNDY GXG:IQN) is CEO and Chairman, George Syrmalis. George welcome to FNN.
George Syrmalis: Thank you Donna, thank you for having me here.
Donna Sawyer: IQNovate is the world’s first intellectual property asset management company, servicing the global biopharmaceutical industry. Tell me about your core business and exactly what it is that you do?
George Syrmalis: Our core business is basically defined by our clients. So we have two types of clients, the pharmaceutical companies and the biotechnology companies. For the pharmaceutical companies, we do the contract drug development process from end to end, from research right out to registration and commercialisation. For the biotechnology companies, we do early stage to advanced stage advisory work.
Donna Sawyer: So what is the global market potential for IQNovate services?
George Syrmalis: Well the potential for the global, for IQNovate services really depends on the potential of the pharmaceutical and biotech companies. At this stage, the drug development business is estimated to reach $1.3 trillion by 2015.
Donna Sawyer: Let’s talk about the main challenges the biopharmaceutical industry faces. What are they and how does your company address them?
George Syrmalis: Well the typical challenges any industry is called to face these days, is economies of scale. The biopharmaceutical industry in general has to face the regulators’ challenges, which are very very important. For instance, in any other product development process, you do not have registration and you don’t have the rigid clinical trials that take place. So a car developer will develop a car and just release it on to the market, and take the commercial risk. A drug developer will actually sink $1.5 billion in research in a drug, and will only have a 20 per cent probability of getting that registered. And registration doesn’t mean that it will be a commercial success either.
Donna Sawyer: Tell me more about your outsourced approach and why that offers value to biopharmaceutical companies?
George Syrmalis: Well as a compound in a biopharmaceutical company progresses down the research and development pathway, the statistical probabilities that it makes registration are actually diminishing. And in this particular phase, our outsourcing model is a model which caters for different phases at different stages. So a pharmaceutical company will not have to have a whole research and development team on, to develop one compound which only has a 20 per cent probability of getting approved. On the other hand, we may also be co-developing three or four or five different drugs with the same staff, with the same laboratory personal; hence creating economies of scale.
Donna Sawyer: What are the most critical elements investors should consider when investing in a biotech company?
George Syrmalis: Risk and risk balancing, and risk mitigation, corporate strategy, portfolio, leverage in that portfolio. Whether the company has experience to market the product, because you may have a great biotechnology company, which will make a product and it will get it registered. But does it have the expertise to actually market it and sell it? Does it have the expertise to go and create an alliance with a partner that will sell it for it? They’re the things we’ll have to look at.
Donna Sawyer: IQNovate listed on the NSX just over two years ago and has had over 500 per cent uplift since listing. Could you tell us about the impetus for that growth?
George Syrmalis: IQNovate has introduced an innovative model worldwide. And I think many of our investors just love the idea, love the concept, love the innovation and hence understood the space that IGNovate operates, and hence invested.
Donna Sawyer: You’ve also cross listed on the US OTC and have plans to list in Europe as well. What was the strategy behind that?
George Syrmalis: Well as we speak, yesterday we listed in Europe’s premium SME GXG Exchange and the strategy behind this is actually globalisation. This enables us and brings awareness to other companies, because we’re in the market for acquisitions as we’ve said previously. And further to this you’re addressing in essence 800 million potential investors, because it’s not only Australian investors anymore. It’s about European investors and it’s about American investors. And don’t forget that, especially American investors, they understand biotechnology much better than we do.
Donna Sawyer: You say you have a global M&A strategy. What type of companies are you hoping to buy?
George Syrmalis: We’re looking to buy clinical research organisations, CROs. We’re specifically looking in the Asia Pacific region, which doesn’t exclude any other CRO in Europe.
Donna Sawyer: You’re also involved with a number of leading industry organisations. Is partnering a key part of your business strategy?
George Syrmalis: The drug development process is a process which at very best, has a cost of $1.5 billion per drug. When taking failure into account, then failure is the case most of the time, it goes up to $2 million. It would be utopic to think that anybody could handle such a cost without taking partnering into serious account.
Donna Sawyer: Finally, what would you like to see IQNovate achieve by this time next year?
George Syrmalis: Trying to be objective, I think I would like to have IQNovate run up there globally acknowledged as a third party drug development partner, within the biopharma industry.
Donna Sawyer: George Syrmalis thanks for the introduction to IQNovate.
George Syrmalis: Thank you for your time.
Ends
