January 8, 2021 – After Carl Hansen co-founded AbCellera Biologics Ltd. in 2012, people constantly told him he was building a biotechnology company the wrong way. “The whole sector for years has been focused on this idea that if you wanted to build a valuable company, you have to make your own drugs,” Dr. Hansen told the Globe and Mail Thursday. “It was very hard in the early days for people to understand that wasn’t the only way to do things.”
He never wavered, and today the 46-year-old former University of British Columbia professor is Canada’s newest multibillionaire. AbCellera had a historic initial public offering on the NASDAQ stock market last month, raising US$555-million.
That’s good news for the company’s hometown of Vancouver, where Dr. Hansen plans to hire hundreds of people (AbCellera has just more than 200 now) and eventually expand laboratory operations to one million square feet – and hopes to build AbCellera into Canada’s first true pharmaceutical industry giant.
“We’re building a centralized platform people can access from anywhere in the world, but it means infrastructure, facilities, equipment and very significant growth in full time employees,” he said. “The lion’s share of that will happen in Vancouver,” which is also home to leading Canadian biotech companies Zymeworks Inc. and Acuitas Therapeutics.
AbCellera emerged last year as a leading early stage company in the race to bring COVID-19 treatments to market, and had one of 2020′s best debuts of any IPO. The stock tripled its US$20-a-share issue price on its first day of trading. It has since eased back, closing Thursday at US$39.32. But AbCellera’s market capitalization of US$10.6-billion is greater than some Canadian corporate stalwarts and it has the support from some of the globe’s top investors in the sector, including DCVC Bio, Viking Global Investors, OrbiMed and Silicon Valley billionaire Peter Thiel, a company director.
On Thursday, Dr. Hansen spoke publicly for the first time since the IPO, which more than doubled the previous record for a new issue by a Canadian biotech company. “I’d say the business model is the thing investors got so excited,” he said.
Dr. Hansen led AbCellera’s 2012 spinout from UBC’s interdisciplinary Michael Smith Laboratories, where he ran the bioengineering group. Using technology developed at the lab, AbCellera speeds up the process of isolating and identifying antibodies that humans create to fight infections.
Its “antibody discovery engine” passes blood samples from a person who has developed an immunity through a credit-card-sized device with hundreds of thousands of tiny chambers. With the help of artificial intelligence, it tests antibodies produced by cells in each chamber simultaneously to determine which have potential to become drugs.
AbCellera set out to partner with drug developers; it would continuously spin out treatments for a range of ailments and earn research fees, milestone payments and eventually royalties as its partners advanced the molecules from lab to market. “We started this business to be focused on cutting, bleeding-edge technology from multiple sectors brought together … to [improve investment returns] from drug development and discovery,” Dr. Hansen said.
That meant, unlike many other biotech companies, AbCellera would not take on costly, risky development itself, nor hang its fortunes on one drug. It has partnered on 94 drug-discovery programs and more than doubled revenue annually, on average, since 2014, bringing in US$25.2-million during the first nine months of 2020.
A key turning point came in 2015, when AbCellera worked on projects funded by the U.S. Defence Department’s Defense Advanced Research Projects Agency (DARPA) to find rapid medical responses to pandemics. AbCellera then landed a lead role in 2018 and US$30.6-million in DARPA funding heading one of four research groups working to develop antibody treatments for pandemics. “That allowed us to sharpen the axe of our technology for pandemic response and ultimately led to our position to respond quickly to the COVID-19 pandemic.”
That meant AbCellera was the right company at the right time as the novel coronavirus spread globally early last year – just as it was finalizing US$105-million private financing that valued the enterprise at the time at less than US$400-million. “When [the first case] was first reported in the U.S., we met within an hour and decided, ‘All hands on the problem,’” Dr. Hansen said. “We probably diverted two-thirds of the company” to work on a COVID-19 antibody program.”
Three days after receiving a blood sample from a recovered patient on Feb. 28, AbCellera researchers isolated hundreds of antibody candidates. They cut that number to 24 within three weeks and partnered with Eli Lilly & Co. Within 90 days, the American drug giant had an antibody-based drug for COVID-19 in clinical trials based on AbCellera’s work. U.S. and Canadian regulators authorized the treatment in November for emergency use, and their governments have ordered 950,000 and 26,000 doses, respectively.
Dr. Hansen acknowledges his newfound wealth “is eye-popping. You’d be hard-pressed to find an example of that type of growth [in value] certainly in Canada, maybe anywhere. I certainly would not have anticipated that a year ago.
“But the success of the IPO and the personal number is much less important than the opportunity in front of us. What [is] exciting is that now we are in this spectacular position here in Canada … to bring this to scale.”