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Biopharm Development & Manufacturing existing projects, and these will continue to generate royalties for us. Our plan is to work with future partners as codevelopers rather than licensing out products completely." FINDING AND CREATING FUNDING In September 2013, MorphoSys raised around €84 million, which it will use to fund the clinical development of MOR208, a humanized monoclonal antibody that targets CD19 and is in Phase 2 trials for the treatment of B-cell acute lymphoblastic leukemia (B-ALL) and nonHodgkin's lymphoma. Licensed from Xencor, MOR208 (then known as XmAb5574) also has potential in other B-cell malignancies and in autoimmune disease. The money is also earmarked for further development of MOR202 and to move other proprietary pipeline candidates into further preclinical and clinical development. As a sign of its success, MorphoSys created a new funding initiative cardiovascular disease, and others. Of these, 21 are in clinical trials, with the rest in discovery and preclinical studies. While the majority of the compounds are part of partnered programs, the company's in-house proprietary projects are gaining strength. MorphoSys also has access to a number of proprietary technologies in addition to HuCAL: Slonomics, an automated process for generating doublestranded DNA triplets to create diverse combinatorial gene libraries; arYla, a platform that generates combinatorial libraries for antibody optimization; and Ylanthia, MorphoSys' largest and most recent Fab (fragment-antigen binding region) library. Another of the secrets of MorphoSys' success is the fact that the company is, perhaps unusually, still led by one of its cofounders. After 20+ years, Moroney still displays infectious enthusiasm for what he does. "Why am I still here? It's interesting and exciting, and I feel that I can contribute," says Moroney. "Developing differentiated drugs is an exciting challenge." Good internal communication has been a key strand of MorphoSys' story, through the good times and the bad, as well as being prepared to tackle problems head on. "With the Novartis deal, this changed how the company worked — Simon Moroney, Ph.D., CEO we switched from feefor-service to drug development as a result of this one single big deal, and moving the company's focus brought challenges. We needed to bring people onboard with new skills and different mindsets, and the integration wasn't always easy," says Moroney. "For example, drug development requires a higher spend than other parts of the company, which caused some internal questions. It's about communicating internally and executing the research. We needed to work hard to bring everyone on board and to dovetail the new project into our existing structure. But once people understood the motivation behind the change, they rallied." Looking back, Moroney says he has changed how he has done things over the years. However, he doesn't feel he would have done many things differently. "There are always small things that I would change — for example, clauses in contracts — but you always have to accept some compromises in negotiation. My advice to my old self would be to do everything that we have done, but sooner," says Moroney. "It's a very exciting time for us. We have a lot of compounds approaching proof-of-concept in the clinic, and we are not far off from reaching the market. We have the opportunity to build and grow, and it has never felt more positive." "These deals were turning points for us; they provided us with income and convinced our investors that we have the capabilities to develop our own pipeline of drugs." last year. Under this initiative, MorphoSys provides innovation capital and collaborative support for promising start-ups in protein design, generation, and screening, including technologies, targets, and compounds. In exchange, MorphoSys will seek access to innovative development candidates or technologies. As an example of this, MorphoSys made an equity investment in Dutch biopharma company Lanthio Pharma in November 2012. MorphoSys and Lanthio Pharma are collaborating to use their technologies to create and screen libraries of lantipeptides — therapeutics with high-target selectivity and improved drug-like properties. MorphoSys has the option for an exclusive license covering Lanthio Pharma's LanthioPep technology for drug discovery. SECRETS OF SUCCESS Drug development is a high-risk endeavor, with high rates of attrition between concept and market. MorphoSys' approach to reducing this risk has been to maximize the number of products and therapeutic areas in its development portfolio, which currently includes 81 products across a variety of different diseases, including oncology, autoimmune and inflammatory disease, musculoskeletal disorders, 42 LifeScienceLeader.com February 2014