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From Smart Cells to Smart Pets: How Todd Zion is Pioneering Biotech Innovation in Pet Healthcare
Sometimes the most promising opportunities aren’t in creating new technology, but in bringing proven approaches to untapped markets. That’s exactly what Todd Zion discovered after selling his first biotech company, Smart Cells, to Merck for $500 million in 2010.
In a recent episode of Category Visionaries, Todd shared how he’s building Akston Biosciences into what one investor dubbed “the Biogen for pets” – applying sophisticated biotechnology to revolutionize pet healthcare.
The Path to Pet Health Innovation
After the Smart Cells exit, Todd initially followed the traditional biotech playbook. “We wanted to keep doing what we were good at, which is basically engineering proteins so that they can become better medicines,” he explains. Akston started by exploring multiple applications of their protein engineering technology in human health.
But they noticed something interesting about the pet health market: while human drug development typically requires 10+ years and hundreds of millions in investment, pet medicines could be validated much faster and more efficiently.
“Within a year from having the concept, we’re actually in client owned dogs and eventually cats that had diabetes, proving out that this could really control their blood sugar for an entire week with single injection,” Todd shares.
The Market Reality Check
This faster validation path wasn’t the only advantage. The pet health market was evolving rapidly as people increasingly treated their pets as family members. However, unlike human healthcare where insurance covers most medication costs, pet medications remain primarily out-of-pocket expenses.
“We have to build our products based on what we think is likely… it’s going to still be out of pocket pay for the foreseeable future,” Todd notes. This reality forced Akston to innovate not just in the science, but in making their treatments cost-effective for pet owners.
The Pivot to Full Pet Focus
About 18 months ago, Akston made a decisive move to focus entirely on pet health. “It’s the best decision that I’ve ever made, but it was the most difficult one because it took the most restructuring and remessaging for the company than we ever have in its history,” Todd reflects.
This included finding new homes for their human health assets through spin-outs and licensing. While challenging, the pivot gave them a clearer path forward in an emerging category.
Building the Future of Pet Biotech
Today, Akston is developing breakthrough treatments including:
- A bladder cancer treatment for dogs (currently in field trials)
- An “Ozempic for cats” starting trials in January 2025
- Treatments for chronic pain and dermatitis in dogs
Their platform approach allows them to “keep generating new products for new product categories without really changing the script on the technology,” as Todd explains.
With over $50 million raised to date and another $15 million round in progress, Akston aims to become “the premier biotech company for pets.” As Todd notes, while some companies are “dabbling with biotechnology in pet health, they’re not companies that are taking the biotech approach to it.”
The Category Creation Challenge
Building a new category isn’t easy, especially in regulated markets. But Akston’s approach offers valuable lessons for founders:
- Find structural advantages in adjacent markets
- Build for current market realities, not future possibilities
- Execute pivots while you still have resources
- Create extensible technology platforms
- Get real-world validation as early as possible
As pets become increasingly central to American families, the opportunity for innovation in pet healthcare continues to grow. Akston’s journey shows how bringing sophisticated technology to underserved markets can create massive value – if you’re willing to adapt your approach to market realities.
Actionable
Takeaways
Navigate pivots decisively:
Todd emphasized that most founders wait too long to pivot. He advises that when you start seeing signs that the future isn't unfolding as planned, that's the time to begin considering a pivot - while you still have resources and before becoming too entrenched. Their pivot to focusing entirely on pet health required significant restructuring but ultimately created a clearer path forward.
Find the regulatory sweet spot:
Akston discovered that pet health offered a faster path to market validation compared to human health biotech. The ability to conduct field trials with just hundreds rather than thousands of subjects, combined with more streamlined regulatory requirements, allowed them to de-risk their assets more quickly and cost-effectively while still maintaining high standards.
Build for the actual market conditions:
Rather than assuming future market changes (like expanded pet insurance coverage), Akston designs their products around current market realities - namely that most pet medications are paid out-of-pocket. This forced them to innovate not just technically but in development and manufacturing to keep costs accessible to pet owners.
Create new categories through technology translation:
Instead of building an entirely new technology, Akston applied proven biotech approaches from human health to the pet market. This allowed them to leverage existing expertise while pioneering a new category, positioning themselves as "the Biogen for pets" rather than just another pet health company.
Structure early testing for rapid validation:
By utilizing the FDA's investigational new animal drug application process, Akston could begin testing in their target population much earlier in development. This enabled them to validate their concepts within a year rather than waiting through multiple phases of trials, allowing for more efficient resource allocation.
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