In a slightly less broken world, Enosi Life Sciences would not exist as is. Enosi is a tiny drug research and development company. And that is the only ordinary-sounding thing about it. Its technology is not ordinary. Its rockstar founders are far from ordinary. And its vision to create a new, more powerful and safer generation of autoimmune, anti-inflammation and cancer-fighting drugs is extraordinarily ambitious — and well within reach.
Enosi is a product of three broken worlds. It would not exist as we know it if Big Pharma did its job better. Alas, Big Pharma suffers from numerous self-inflicted blind spots. And Enosi occupies a big one. Big Pharma shies away from making drugs for partial populations. It wants its drugs to treat all colon cancer patients, for example, not just some of them. Enosi is forging ahead in this abandoned space with exciting and potentially breakthrough technology.
We can also thank Big Venture Capital (VC). Big VC makes Big Pharma seem like a well-oiled machine operating on all cylinders. But when it comes to early drug development, VCs look the other way. Instead of providing funding, they can’t flee fast enough. VC firms say they’re playing the odds. But that’s not true. It’s a lazy and dogmatic excuse. And Enosi is proof.
Last but not least, there’s Big Government and the many hoops it requires drug development companies to jump through. It costs small biotech companies around $150 million to get a drug approved. That’s a big reason why medications are so expensive.
Big Pharma can afford that price tag. But it creates big problems for smaller biotech companies. VCs could fund that amount if they wanted to. But they usually don’t. Too risky, they say. That leaves companies like Enosi with limited options. Fund the earliest drug development themselves? Bootstrap their way to clinicals? Do a crowdfunding raise?
Enosi is doing all three. The founders have invested $800,000 of their own money. They’re planning to spend only $12.5 million in order to reach phase 1 of clinical trials. The more typical price tag runs around $50 million. And the company is raising money on the crowdfunding portal Title3Funds.
So thank you, Big Pharma. Thank you, Big VC. And thank you, Big Government. Thank you for making Enosi’s remarkable investment opportunity available to everyday investors like us.
A Powerful Leadership Team Makes Enosi Special
I like knowledgeable and experienced founders. And I like technology that makes a big impact in huge markets. That’s Enosi. I’m following the same tried and true formula I’ve used in previous recommendations.
But Enosi shines so much brighter in terms of technology, markets and especially founding team that it occupies a category of its own.
I’ve never had the privilege of considering a leadership team with the revenue-generating track record and star power of Enosi’s. Sir Marc Feldmann (director and co-founder) and Dr. Mike Shepard (chief science officer) are both master inventors. Their drugs have generated billions of dollars of revenue. And the technology they’ve spent their whole careers developing and mastering has generated billions of dollars.
It’s the same technology Enosi is deploying to create a new class of drugs that will replace the rapidly fading 30-year-old generation of drugs.
While at Genentech, Mike developed a breakthrough breast cancer-fighting antibody. (Antibodies are large proteins used by the immune system to identify and neutralize foreign objects, such as pathogenic bacteria and viruses.)
The idea behind his “growth factor trap” treatment is that normal cells need “growth factors” but cancer cells need more of them and some cancer cells need much more. Depriving such cells of these growth factors essentially starves them and — for the 10% to 15% that really depend on these growth factors — kills them.
It was and still is one of the most successful biomarker-driven drug discoveries ever. It drove up to $10 billion of revenue a year for Genentech and then for Roche (which acquired Genentech in large part to benefit from the rich revenue stream Mike’s Herceptin/trastuzumab drug generated).
Yet Genentech almost nixed Mike’s cancer-fighting drug. It wanted a drug that worked for all breast cancer patients. Mike’s drug was effective only for those with the right biomarker (or molecule found in the blood or other body fluids). That turned out to be 25% of breast cancer patients — more than enough to turn the drug into a blockbuster revenue generator.
Mike’s technology takes advantage of the fact that biomarkers can indicate how well someone responds to a treatment for a disease. It can also be easier to get FDA approval for a drug that effectively treats subpopulations identified through biomarkers. Mike has brought this same biomarker approach to Enosi.
Mike’s fellow co-founder and master drug inventor at Enosi, Sir Marc Feldmann, is a superstar drug developer in his own right. The class of drugs based on his anti-tumor necrosis factor (TNF) therapy has become the most successful medicine for autoimmune disease. That class of drugs is also the biggest all-time income generator among all the FDA-approved pharmaceuticals — accounting for about $40 billion worth of sales in 2019 alone.
Both Mike and Marc have accumulated numerous awards and citations, including the American equivalent of the Nobel Prize, called the Lasker Award. And if that’s not enough, they’re both highly successful entrepreneurs. Marc has started several companies, and Mike has been part of numerous successful ventures.
So this is what you need to know. Enosi has filed three patents based on Mike’s research and Marc’s research. The company has selected two molecules for testing. The molecule that Marc will be testing is in the very early stages of “in vitro” testing. It’s still four to five years away from human clinicals. Mike’s molecule is much further along, having already gone through lab and animal testing for cancer and autoimmune disease indications. It’s only one to two years away from human trials.
To be sure, there’s still technical risk. The molecules may not pass the series of tests that still await. But these two star drug developers agree that the two molecules selected have the most potential. Nor should we forget that their older drugs — based on the same technology — successfully passed the FDA’s slew of tests to become bestsellers. And finally, it bears repeating that biomarker-driven drug solutions that target subpopulations have a lower bar to jump over. And targeting these subpopulations can generate massive revenue.
Funding Risk Has Just Been Significantly Reduced
The biggest risk to investing in Enosi is funding. But there’s great news about that. (And as far as I know, you’re the first ones to hear about this.) Enosi has found a biotech company that will take over drug development responsibilities — including covering the costs. Enosi will provide drug consulting and guidance… and will still get the majority of revenue from U.S. and global sales.
So funding risk has just gone way down. That’s a good sign. It’s an even better sign when a startup has two star co-founders who have developed drugs that collectively generated up to $50 billion a year in revenue. If this were any other space besides pharma, VC money would be rolling in. And Enosi is addressing a rapidly growing market. The autoimmune disease and TNF pathway drugs market is growing at a nearly 10% annual rate. In just seven years, it’s going to double.
Every startup needs a little luck to succeed. Between having extraordinary founders, developing exceptional technology and addressing big problems in fast-growing markets, Enosi has a lot going for it… so much so that it would probably take a streak of bad luck for it not to succeed.
That’s a bet I’m willing to make 10 out of 10 times.
Deal Details
Startup: Enosi Life Sciences
Security type: Common stock
Price per share: $10.00
Valuation: $25,102,770
Minimum investment: $500
Where to invest: Title3Funds
Deadline: July 19, 2022
How to Invest
Enosi is raising up to $1.07 million in this round of funding on Title 3 Funds. You’ll need to sign up for an account there if you haven’t yet.
Once you’re signed in to your Title 3 Funds account, head over to the Enosi raise page. Now enter the amount you want to invest and click the orange “Invest” button on the right-hand side of the screen. The minimum investment on this deal is $500.
Risks
This opportunity, like all early-stage investments, is risky. Early-stage investments often fail. Enosi will likely need to raise another round of funding in a year, if not sooner.
If it executes well, this shouldn’t be a problem. But that’s a risk worth considering when investing in early-stage companies. The investment you’re making is NOT liquid. Expect to hold your position for five to 10 years. An earlier exit is always possible but should not be expected.
All that said, I believe Enosi offers an attractive risk-reward ratio.