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Written by Natasha Lomas

Germany says it won’t ban Huawei or any 5G supplier up front

Germany is resisting US pressure to shut out Chinese tech giant Huawei from its 5G networks — saying it will not ban any supplier for the next-gen mobile networks on an up front basis, per Reuters.

“Essentially our approach is as follows: We are not taking a pre-emptive decision to ban any actor, or any company,” government spokesman, Steffen Seibert, told a news conference in Berlin yesterday.

The country’s Federal Network Agency is slated to be publishing detailed security guidance on the technical and governance criteria for 5G networks in the next few days.

The next-gen mobile technology delivers faster speeds and lower latency than current-gen cellular technologies, as well as supporting many more connections per cell site. So it’s being viewed as the enabling foundation for a raft of futuristic technologies — from connected and autonomous vehicles to real-time telesurgery.

But increased network capabilities that support many more critical functions means rising security risk. The complexity of 5G networks — marketed by operators as “intelligent connectivity” — also increases the surface area for attacks. So future network security is now a major geopolitical concern.

German business newspaper Handelsblatt, which says it has reviewed a draft of the incoming 5G security requirements, reports that chancellor Angela Merkel stepped in to intervene to exclude a clause which would have blocked Huawei’s market access — fearing a rift with China if the tech giant is shut out.

Earlier this year it says the federal government pledged the highest possible security standards for regulating next-gen mobile networks, saying also that systems should only be sourced from “trusted suppliers”. But those commitments have now been watered down by economic considerations at the top of the German government.

The decision not to block Huawei’s access has attracted criticism within Germany, and flies in the face of continued US pressure on allies to ban the Chinese tech giant over security and espionage risks.

The US imposed its own export controls on Huawei in May.

A key concern attached to Huawei is that back in 2017 China’s Communist Party passed a national intelligence law which gives the state swingeing powers to compel assistance from companies and individuals to gather foreign and domestic intelligence.

For network operators outside China the problem is Huawei has the lead as a global 5G supplier — meaning any ban on it as a supplier would translate into delays to network rollouts. Years of delay and billions of dollars of cost to 5G launches, according to warnings by German operators.

Another issue is that Huawei’s 5G technology has also been criticized on security grounds.

A report this spring by a UK oversight body set up to assess the company’s approach to security was damning — finding “serious and systematic defects” in its software engineering and cyber security competence.

Though a leak shortly afterwards from the UK government suggested it would allow Huawei partial access — to supply non-core elements of networks.

An official UK government decision on Huawei has been delayed, causing ongoing uncertainty for local carriers. In the meanwhile a government review of the telecoms supply chain this summer called for tougher security standards and updated regulations — with major fines for failure. So it’s possible that stringent UK regulations might sum to a de facto ban if Huawei’s approach to security isn’t seen to take major steps forward soon.

According to Handelsblatt’s report, Germany’s incoming guidance for 5G network operators will require carriers identify critical areas of network architecture and apply an increased level of security. (Although it’s worth pointing out there’s ongoing debate about how to define critical/core network areas in 5G networks.)

The Federal Office for Information Security (BSI) will be responsible for carrying out security inspections of networks.

Last week a pan-EU security threat assessment of 5G technology highlighted risks from “non-EU state or state-backed actors” — in a coded jab at Huawei.

The report also flagged increased security challenges attached to 5G vs current gen networks on account of the expanded role of software in the networks and apps running on 5G. And warned of too much dependence on individual 5G suppliers, and of operators relying overly on a single supplier.

Shortly afterwards the WSJ obtained a private risk assessment by EU governments — which appears to dial up regional concerns over Huawei, focusing on threats linked to 5G providers in countries with “no democratic and legal restrictions in place”.

Among the discussed risks in this non-public report are the insertion of concealed hardware, software or flaws into 5G networks; and the risk of uncontrolled software updates, backdoors or undocumented testing features left in the production version of networking products.

“These vulnerabilities are not ones which can be remedied by making small technical changes, but are strategic and lasting in nature,” a source familiar with the discussions told the WSJ — which implies that short term economic considerations risk translating into major strategic vulnerabilities down the line.

5G alternatives are in short supply, though.

US Senator Mark Warner recently floated the idea of creating a consortium of ‘Five Eyes’ allies — aka the U.S., Australia, Canada, New Zealand and the UK — to finance and build “a Western open-democracy type equivalent” to Huawei.

But any such move would clearly take time, even as Huawei continues selling services around the world and embedding its 5G kit into next-gen networks.

WeWork pulls thousands of phone booths out of service over formaldehyde scare

WeWork, the co-working empire once valued at $47 billion before reality struck, plunging the business and its investors into crisis, has another problem to add to its growing pile — one which doesn’t exactly reflect well on its core business of kitting out and maintaining modern working environments.

The problem is a safety concern affecting users of WeWork co-working spaces in the U.S. and Canada. Today the company emailed members in the regions to warn that around 1,600 phone booths installed at WeWork locations have been found to have elevated levels of formaldehyde — which it warns could cause health issues for people exposed to the gas.

WeWork blames the issue on a manufacturer of the booths.

The booths are provided in its co-working spaces for WeWork members to be able to take calls in private — given other common areas are shared by all users. 

“After a member informed us of odor and eye irritation, WeWork performed an analysis, including having an outside consultant conduct a series of tests on a sampling of phone booths. Upon receiving results late last week, we began to take all potentially impacted phone booths out of service,” it writes in an email to members.

Affected phone booths “are being taken out of service immediately, and will be removed from your location as soon as possible,” it adds. 

In addition to ~1,600 booths it has confirmed are affected, a further 700 booths are being taken out of service in what WeWork describes as “an abundance of caution” — i.e. while it carries out more checks — with the promise of a further update once it has concluded its tests. 

Members wanting to know which booths are safe to use in the meanwhile are told to contact the community team at their WeWork location.

WeWork also says alternative quiet spaces will be provided, such as in conference rooms and unused offices. 

Discussing the health risks of formaldehyde gas — a chemical which is used in various building materials –WeWork’s email warns: “Short-term exposure to formaldehyde at elevated levels may cause acute temporary irritation of the nose, throat, and respiratory system, including coughing or wheezing. These effects are typically transient and usually subside after removal of the formaldehyde source.

“Long-term exposure to formaldehyde, such as that experienced by workers in jobs who experience high concentrations over many years, has been associated with certain types of cancers. You can find additional information in this FAQ from the Occupational Safety and Health Administration.”

The email encourages any WeWork members with health concerns to contact a doctor.

A tipster who sent us the email reported experiencing a sensation of “burning eyes” after using the booths.

They also said several people in their team had experienced the same issue.

“Some complained that they felt nauseous after spending time inside the booths,” the tipster wrote. “I never felt that, but the burning eyes was 100% there for me several times. Scary stuff.”

Reached for comment, a WeWork spokesperson confirmed the formaldehyde issue, saying it’s taking “a number” of booths out of service at “some” locations in the U.S. and Canada — due to “potentially elevated levels of formaldehyde caused by the manufacturer.”

“The safety and well-being of our members is our top priority, and we are working to remedy this situation as quickly as possible,” it adds in a statement.

It is not clear exactly how many WeWork locations contain affected booths at this point.

Nor has WeWork provided more detailed information about how long members might have been exposed to elevated levels of formaldehyde — with its email merely suggesting some of the booths have been in place for “months.” 

“The potentially impacted phone booths have been installed over the past few months, exact timing varies based on location,” it writes.

Although clearly the level of exposure will vary from person to person depending on their use of the booths.

The company did not respond to a question asking whether any of its international WeWork locations are affected by the issue.

UK biotech startup Mogrify injects $16M to get novel cell therapies to market soon

Cambridge, UK-based biotech startup Mogrify, which is working on systematizing the development of novel cell therapies in areas such as regenerative medicine, has closed an initial $16 million Series A.

The raise follows a $4M seed in February — taking its total raised to date to $20M.

Put simply, Mogrify’s approach entails analysis of vast amounts of genomic data in order to identify the specific energetic changes needed to flip an adult cell from one type to another without having to reset it to a stem cell state — with huge potential utility for a wide variety of therapeutic use-cases.

“What we’re trying to do with Mogrify is systematize that process where you can say here’s my source cell, here’s my target cell, here are the differences between the networks… and here are the most likely points of intervention that we’re going to have to make to drive the fate of an adult cell to another adult cell without going through a stem cell stage,” says CEO and investor Dr Darrin Disley.

So far he says it’s successfully converted 15 cells out of 15 tries.

“We’re now rapidly moving those on through our own programs and partnership programs,” he adds.

Mogrify’s business has three main components: Internal program development of cell therapies (current cell therapies it’s developing include enhancing augmented cartilage implantation; non-invasive treatment of ocular damage; and for blood disorders). It’s also developing a universal source of cells for use in immunotherapy — to act as “disease-eaters”, as Disley puts it.

Speculative IP development is another focus. “Because of the systematic nature of the technology we’re in a position very rapidly to identify areas of therapy that have particular cell conversions at their essence — and then drive that IP generation around those cells very quickly and create an IP footprint,” he says.

Partnering deals is the third piece. Mogrify is also working with others to co-develop and bring targeted cell therapies to market. Disley says it’s already closed some partnerships, though it’s not announcing any names yet.

The startup is drawing on around a decade’s worth of recent work genomics science. And specifically on a data-set generated by an international research effort, called Fantom 5, which its founders had early access to.

“We started with that massive Fantom data-set. That’s the baseline, the background if you like. Think of it like two cities in America: Chicago and New York. There’s your source cell, there’s your target cell. And because you have all the background data of every piece of the network — every building, every skyscraper — if you look at the two you can identify the difference in the gene expression, therefore you can identify which factors will regulate a wide array of those genes. So you can start identifying the differences between the two,” explains Disley.

“We’ve then added to that massive data sets in DNA-protein and protein-protein interactions… so you start to now overlay all of that data. And then we’ve added on top of that new next-gen sequencing data and epigenetic data. So you’ve now got this massive data-set. It’s like having a network map between all the different cell types. So you’re therefore then able to make predictions on how many interventions, what interventions are needed to drive that change of state — and it’s systematic. It doesn’t just recommend one set. There’s a ranking. It can go down to hundreds. And there is some overlap and redundancies, so for example if one — you’re preferred thing — doesn’t work the way you wanted it to you can go back and select another.

“Or if there’s an IP issue around that factor you can ignore that piece of the network and use an alternative route. And once you’ve got to your target cell, if it needs to some tweaking you can actually re-sequence it and take that back and that’s your starting cell again. And you can go through this optimization process. So what comes out at the other end… you’ve got a patent that it like a small molecule composition of matter patent; it’s the therapeutic. So you’re not coming out with the target, you’re actually coming out with here is the composition of matter on the cell.”

In terms of timeframe for getting novel cell therapies from concept to market Disley suggests a range of between four and seven years.

“Once you’ve identified the cell type that can be be the basis of your GMP manufacturable process and then you can tweak that to take it to the therapeutic indication you can develop a cell therapy and bring that to market in five years,” he says. “It’s not like the old days with small molecules where it can take ten, 15, 20 years to get a serious therapy on the market.

“When you’re treating patients… is because there are no other treatments for them, when you go into phase two and do your safety study [and] efficacy study you’re actually treating patients already in terms of their disease. And if you get it right you can get a fast track approval. Or a conditional approval… so that you may not even have to do a phase 3 [testing].”

“We’re not using any artificial intelligence here,” he also emphasizes, pointing to his experience investing in companies in the “big extreme data space” which he argues do best by using “unbiased approaches”.

“AI I think is still trying to find its way,” he continues. “Because in its essence it will be able to get to answers with smaller amounts of data but it’s only as good as the data you train it on. And the danger with AI… it just learns to recognize what you want it to recognize. It doesn’t know what it doesn’t know.

“In combination, once you continue to generate this massive cell network data etc you can start applying aspects of machine learning and AI. But you couldn’t do Mogrify with AI without the data. You have to do it that way. And the data is so complex and combinatorial — 2,000 transcription factors, in terms of regulation of those genes, they then interact in network to do the protein-protein interactions, you’ve got epigenetic aspects of that, you could even start adding cell microbiome effects to that later — so you’ve got a lot of factors that could influence the phenotype of the cell that’s coming out the other end.

“So I think with AI you have to be a little careful. I think it will be a more optimizing tool once you’ve got sufficient confidence in your system.”

The plan for the Series A funding is to ramp up Mogrify’s corporate operations and headcount — including bringing in senior executives and expertise from industry — as well as spending to fund its therapy development programs.

Disley notes its recent appointment of Dr Jane Osbourn as chair as one example.

“We’re bringing in more people with a lot of cell therapy experience from big pharma, around then more on the manufacturing and delivery of that — so really building so that we’re not just a tech company,” he says. “We’ve very strong already, we’re already 35 people on the tech and early stage drug discovery side — we’re going to add another 30 to that. But that’s going to be increasingly more people with big pharma, cell therapy development, manufacturing experience to get products on to market.”

Partner search is another focus for the Series A. “We’re trying to find the right strategy partners. We’re not doing services, we’re not doing products — so we want to find the right strategic partners in terms of doing multi-programs in a partnership,” he adds. “And then a series of more tactical deals where people have got a specific problem with a cell conversion. These more turnkey deals, if you like. We still get up-fronts, milestones and royalties but they’re smaller.”

Despite now having enough money for the next two to two and half years it’s also leaving the Series A open to continue expanding the round over the next 12 months — up to a maximum of another $16M.

“We have so many interested investors,” Disley tells us. “This round we didn’t actually open our round. We did it with internal investors and people we’re very close to who we’ve worked with before, and there were investors lining up… [so] we are leaving it open so that in these next 12 months we may choose to increase the amount we bring in.

“It would be a maximum of another $16M if it was an A round but we may decide just to go straight forward if we progress very fast to a much bigger B round.”