Hanne Callewaert | AstriVax

AstriVax is a private spin-off of KU Leuven and was founded in 2022 based on vaccine technology developed at the Rega Institute. Under the leadership of its young CEO Hanne Callewaert, the Leuven-based biotech company aims to tackle significant challenges in vaccinology by developing new vaccines that are easy to produce, impose fewer requirements on the cold chain and offer long-term protection against various viruses and other pathogens. One of these is a new vaccine against yellow fever.

No KU Leuven spin-off has ever been allocated more funds than AstriVax. What does AstriVax do exactly?

Hanne Callewaert: Following discussions with and in collaboration with the Rega Institute (expertise centre for vaccinology), we went in search of effective vaccines based on the yellow fever vaccine. We aim to keep progressing. AstriVax is currently focusing on the development of a vaccine to eradicate yellow fever but is also working on a vaccine against rabies and one against Hepatitis B. Our new vaccine would offer triple benefits. Firstly: it would be a product that can be administered in a very stable way (i.e. in all possible climate conditions). Secondly: it would be easy to produce. Thirdly: it would be easier to use (i.e. would not need to be administered as frequently). All the initial research points in this direction. The development phase will be followed by a clinical trial in 2024, after which the vaccine will be submitted to the competent authorities for approval. All in all, we are speaking about a period of ten years before the vaccine can be brought to the market. We will need to bridge this ten-year period financially or through partnering. Whichever way you look at it, our vaccine will approach the entire problem surrounding yellow fever and other pathogens in a unique way.

What prompted the necessity of founding a separate company? Couldn’t this be encapsulated within the existing structure of the Rega Institute or KU Leuven?

Hanne Callewaert: The university is exceptionally successful in terms of its academic research. However, it does have its limitations. The purpose of a university or academic research institute is not, in the first instance, to focus on the development or marketing of a product. The resources available for this are also limited. Once the research had reached and proven its maturity, the next step was to establish a new company specifically for the products of this research. The only question that remained was: How could we obtain funding?

Which possibilities did you identify for attracting seed capital?

Hanne Callewaert: We actually had two options. One was to knock on the door and become affiliated with a large pharmaceutical company, but this offered limited chances of success because our project is still in the research phase. The second was to capture the interest of the venture capital market.

The human aspect

What were the specific conditions imposed by the consortium of seven private equity players, under the leadership of V-Bio Ventures and Fund+? How was the gap bridged?

Hanne Callewaert: If COVID had any positive effects, it is the heightened interest in the vaccine market. Everyone now knows that healthcare and vaccines are inextricably linked. This understanding has also grown in and become clear to the world of private equity. You could say that the private capital market has developed a healthy appetite – or been given a wake-up call – through the impact of vaccines. This was not as prevalent several years ago.

What are their specific expectations?

Hanne Callewaert: In addition to drawing up the obligatory business and financial plans, the actual, face-to-face meetings we held with potential financial backers were decisive. This cannot be emphasised enough. We met with each of our potential investors separately. Johan Neyts of the Rega Institute, who has amassed quite a bit of credit in the world of vaccines as the head of his research group at the Rega Institute, and Kai Dallmeier, the brain behind the technology, joined us at each of these meetings. I am convinced that this direct interaction was of crucial importance in achieving our goals. Whatever you may think, the human aspect and direct, face-to-face contact remain important, even with potential financial backers. Gaining trust is of crucial importance to all parties involved, and this can only be achieved in an atmosphere of complete transparency, in which each participant is able to express criticism.

Talking with VC’s must have been quite an experience for you as a young CEO. How do you look back at this? What do you remember most from those meetings?

Hanne Callewaert: You would imagine that every individual investor would ask the same questions. This was hardly the case! Every roundtable discussion brought new questions, different issues and other insights. It was an incredibly fascinating experience, and it brought so much added value. Once you have run through the entire process, you understand that you have completed all your homework, so to speak. It was a positive journey from which I learned a lot. Despite everyone having his or her own background (whether scientific or financial), I always felt we were speaking the same language. The profoundness of those bilateral discussions opened up an entirely new world to me. There could not have been a better way to continually question myself and cast a critical eye on what I was doing than through these discussions with private equity players.

Did you have any difficulties negotiating with seven investors, each with their own interests and expectations?

Hanne Callewaert: I never experienced it like that. The idea that having many investors on board would spread the risk is incorrect. All of these investors share the same, common goal: to contribute to the development of a high-potential company. If this “binding agent” were lacking, they would not have been good investors.

Ideal sounding board

How do pursue a quest like this?

Hanne Callewaert: You spend a lot of time talking; not only with lots of prospective investors but also with a small group of people: a representative of Leuven Research & Development and the Rega Institute, an interested financier and myself. All possible aspects and questions are discussed at these meetings. The questions asked by private equity players can vary greatly, which only serves to make the process even more fascinating. And not every meeting results in a deal. If the outcome of an exploratory meeting is not positive, there is nothing wrong with that. Everyone has their own reasons. The opportunity may come too early for one, while the investment is too big for another, and so on. Of course, everyone who agrees to join is at liberty to choose how much they wish to contribute; not everyone is expected to contribute equal amounts.

Venture capital players, as is inherent to their business, are primarily – or even unilaterally – concerned with obtaining a return on their investment. Would you agree with that?

Hanne Callewaert: This is a standpoint that I would actually like to rectify. It’s a bit more subtle than that. I learned from experience that, apart from the archetypical return on investment, they also took an avid interest in the envisioned societal impact of our research. I once heard someone say: “Vaccines are like car seatbelts; they can save human lives”. If you look at it like this, it is clear that it is about more than money.

Long-term perspective

Can you tell me a little about your somewhat longer-term perspective? What are your expectations now that you have these venture capital players on board? Do you discuss your long-term perspectives with them?

Hanne Callewaert: We discussed all possible topics and scenarios with them. Until 2024, and the launch of the clinical trial, everyone will, so to speak, be ready for take-off. They have made a commitment, after all. After 2025, things may change completely, which is clear already. Based on the clinical data, we will be taking things up a notch and be joined by new financial backers based on the ensuing greater need for capital. This is a perfectly normal process. Every investor who joined us has asked: “What’s next?”. And, yes, as of 2025, we will need more than the 30 million euros we managed to raise now. This is something that every private equity player understands.

We assume that foreign backers could also be interested at that time. Would getting in touch with these large players be useful to you at this stage in the game?

Hanne Callewaert: Absolutely. We are actually doing this already – even though we were established less than a year ago. You need to prepare for the future today. Recently I, as a CEO, attended several important events abroad. One of these was a meeting in Leipzig of representatives of the world’s biggest pharmaceutical companies and people from the financial world. I also attended a meeting in London’s Square Mile with around a hundred financial backers from eminent funds. Of course, I took advantage of the opportunity to present our start-up and our objectives. The people operating these circles have now all become acquainted with AstriVax. As a crowning achievement, our biotech company was conferred the European Lifestar Award as the best seed investment case in the world of private equity. But we also want to attract the attention of big pharmaceutical companies. Eventually, they will become interested in what we do.

The importance of name recognition

Can the media also play a role in boosting your name recognition and that of the private equity players on board?

Hanne Callewaert: Without a doubt, and this is certainly not something we have forgotten. The media in both our own and our neighbouring countries are important instruments for this. Name recognition among the broadest public possible would certainly be to AstriVax’s advantage, and not only through professional journals and specialised media in the world of finance and economics. AstriVax currently has eleven people on board and, considering our anticipated growth, we need good external communication to attract new talent.

In conclusion: how do you estimate your market potential once your new yellow fever vaccine is ready?

Hanne Callewaert: It will not be a blockbuster, but this vaccine will appeal to a large audience. The first market that we will tap into with our yellow fever vaccine is the travel market, where there has been a shortage for years. You also have to look at it from a geographical perspective. People want to eradicate yellow fever all over the world. There is a demand in Latin and Central America, as well as all across Africa. The yellow fever vaccine is the basis of many other vaccines that we can develop through our platform technology. I believe that says enough about its potential.